A home warranty is a service contract that covers the repair or replacement of major systems and appliances in your home, such as your HVAC system, water heater, oven, and more.

Warranties are typically valid for one year and can be renewed. Home warranty companies usually have a network of pre-screened, licensed contractors they work with to make repairs.

If something breaks down, you simply call the home warranty company and they will send out a contractor to assess the issue and make the necessary repairs. In some cases, the home warranty company may decide to replace the broken item entirely.

Most home warranty companies have a website where you can browse their plans and pricing. Some even offer a “build your own plan” option that allows you to tailor your coverage to fit your needs and budget.

It’s important to read the fine print of any home warranty contract before you buy so you know exactly what is and is not covered. For example, some warranties only cover items that are “operating properly.” So if an appliance breaks down due to poor maintenance on your part, you might not be covered.

Home warranties can be purchased by homeowners or sellers as an add-on to a real estate transaction. If you’re buying a home, ask the seller if they’d be willing to include a home warranty in the sale. Many sellers are happy to include this coverage as an added selling point.

A home warranty can provide peace-of-mind and protection against expensive repairs or replacements for major systems and appliances in your home. Be sure to read the fine print of any contract before you buy so you know exactly what is covered. Home warranties can be purchased by homeowners or sellers as an add-on to a real estate transaction.