Home warranties are purchased by the seller to provide the buyer with financial protection on certain costly repairs. The home warranty is only in effect for a certain length of time, usually one year. The warranty only pays for specific repairs as listed in the warranty document. This document should be available for potential buyers to review when looking at the property.
Common items covered in a home warranty are some appliances, heating/air conditioning systems, and other items that the seller has just installed. For example, if the seller had recently installed a new roof, new plumbing, and an air conditioning system, those items would likely be included in the warranty.
In a buyer’s market, sellers are using home warranties to make their property more desirable. It does provide some protection to the buyer at a lower cost to the seller.