Who Pays for a Home Warranty Plan and How Does It Work?

Who Pays for a Home Warranty Plan and How Does It Work?


A Home Warranty (also known as a Home Protection Plan) protects both the seller AND the buyer in the case that there is a malfunction with a newly purchased home.

As a summary, we’ll answer these 6 most frequently asked questions:

  1. How do Home Warranties Work?
  2. What does a Home Warranty Cover?
  3. Who Pays for the Home Warranty?
  4. How long does a Home Warranty Last?
  5. Is it possible to Renew a Home Warranty?
  6. How much does a Home Warranty Cost?

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How do Home Warranties Work?

When you have a Home Warranty and something in the house breaks (like an appliance or a plumbing problem), the process is typically pretty simple:

  1. Call the home warranty company and they will then call a service provider in their network for your specific problem (for example: if there is an electrical problem, they will call one of the their preferred electricians)
  2. That service provider will then contact you to come by and fix the problem
  3. After the electrician fixes the problem, you’ll be responsible for paying a small trade service fee. That fee is typically somewhere between $75-100.

Remember that many plans have different pricing and types of coverages, so make sure you read the paperwork to see what you’re covered for.

What does a Home Warranty Cover?

Naturally, that brings up the question: what does a home warranty cover? Well, that depends on the type of coverage you’ve selected, which state you’re in and which company you have coverage with. But typically, your home warranty should cover things such as:

  • Ductwork
  • Plumbing problems
  • Some Home appliances
  • Electrical problems
  • Air conditioning
  • Water heaters
  • and plenty more

Things that are not typically covered are:

  • Sprinklers
  • Hardware repairs
  • Refrigerators, garage door openers and many other appliances
  • Spa or pools

Remember, all plans differ, so make sure you review your home warranty plan to be sure. And for many items such as a pool, you might be able to request special coverage on those items. If you’re in the midst of selecting a plan, the best way to find out what you’re covered for is just ask to see a sample copy of a policy.

Why higher down payments are important for Sellers.

Conventional loans are being prioritized over FHA loans, VA loans, USDA loans and others is because it gives the buyer more flexibility in purchasing a home.

North Carolina Home Buyer

Who Pays for a Home Warranty?

It is pretty standard for the seller to pay for the home warranty but that is not always for certain. We recommend the seller always providing this for the simple reason that they will not be getting calls or threats of legal action from the buyer after closing if something breaks.

How long does a Home Warranty Last?

In regards to the length of time you’re covered under a home warranty, it’s pretty standard for them to last one full year.

Is it possible to renew a Home Warranty?

Most Home Warranties can be extended for an additional year if it is requested, but make sure to find out the terms and costs of that with your provider.

Need a Home Warranty Recommendation?

Shoot us an email or fill out the contact form and we’ll be happy to connect you with one of our favorite Home Warranty Proivders in the Charlotte, North Carolina area.

How Much Does a Home Warranty Cost?

Thankfully Home Warranties are pretty cheap for the peace of mind they’re able to provide. On average, you can expect to pay anywhere between $350-$700 for a year of coverage, depending on what type of coverage you choose.