A real estate home warranty plan has many benefits for homebuyers and sellers alike, making it a win-win all around. As an agent, you can add value to your listings by including coverage as a selling point. And you can reassure buyers already stretched financially thin that home warranty coverage will help protect their budgets.

What is a Real Estate Home Warranty?

A real estate home warranty is a renewable service agreement that covers the repair or replacement of many major home systems and appliances. It reassures both buyers and sellers that if a covered household item malfunctions during the listing period and beyond, they are covered financially for repair/replacement costs. What’s more, adding coverage is quick and easy. Simply order a real estate home warranty plan when a property hits the market (known as “seller’s coverage”) — then be sure to let all prospective buyers know that the property has home warranty protection.

Note: Seller’s coverage is not a standalone product; instead, it’s included with the prospective buyer's home warranty plan. Once a property sells, you (as the seller’s agent) update the home warranty contract with any coverage changes, upgrades, and options the buyer wants, along with the buyer’s contact information, closing company information, and closing date. The seller can pass the cost of the premium to the buyer at closing or negotiate this before agreeing to an offer. Once settled in the home, the buyer can renew the home warranty annually and continue to enjoy its many benefits.

Here's a breakdown of how a home warranty benefits sellers and buyers:

For Sellers: Increase Visibility in the Market

Selling a home can sometimes feel like trying to find the proverbial needle in a haystack. You want to find the perfect buyer while also keeping your seller happy. As an agent, including a real estate home warranty in the transaction is a great way to elevate a property and help it stand out from the crowd.

Seller's home warranty coverage is a valuable home-selling tip and among the best real estate marketing ideas. It sets a home apart from those without it and helps a property get noticed. It can sometimes even help increase a home’s sale price and speed of sale by putting a buyer’s mind at ease.

To attract more attention from potential buyers, be sure to advertise the property with home warranty coverage in all your marketing materials.

A home warranty helps a seller avoid expensive surprises before, during, and after the sale should a covered appliance or system fail. This is especially important when a property is older, not updated, and shows obvious signs of wear. Particularly in cases like this, home warranty coverage reassures potential buyers to submit their best offers, knowing the home is protected. And if there are problems with covered items found during a home inspection, it can help the seller reduce out-of-pocket costs for repairs or replacements.

A home seller talks to his agent after discovering an issue with the dishwasher.

In some cases, a prospective buyer may ask if the seller includes a home warranty as a prerequisite to proceed with the purchase, especially if the appliances and home systems are aging. In this type of scenario, a home warranty acts as a powerful tool that reassures a prospective buyer to move forward with the purchase confidently. That’s why many agents routinely include coverage with all their property listings — it saves them the time and effort of negotiating a home warranty into the purchase because it’s already built in.

Likewise, home warranty coverage can oftentimes help prevent a buyer from backing out of a sale should a covered item unexpectedly break in the middle of the transaction. Best of all, including coverage requires no upfront expenses — as mentioned earlier, the home warranty is paid for at closing.

For Buyers: Reduce Risk and Gain Budget Protection

For a home buyer, purchasing a property protected by a home warranty can minimize the risk of a delay in closing because of an appliance or system breakdown. Knowing that any repairs/replacements will be promptly addressed can also provide greater confidence in the transaction.

It also offers reassurance that a buyer’s budget will be protected if covered home systems or appliances break during the critical first year of homeownership. Once a buyer moves into a new home, the last thing they want to worry about is an expensive repair or replacement bill should a covered household item suddenly malfunction.

Many buyers don’t have much disposable funds left to cover unexpected costs, but with coverage, they know their budget will be protected.

Since home warranties are available with many coverage upgrades and options, it’s important for both sellers and buyers to be aware of what is and isn’t covered. You can help sellers choose their coverage based on the age of their home, its condition, and other distinctive features. Then, when the home sells, you can help the buyer tailor the coverage to fit their own preferences.

Happy homebuyers smile as they receive key to their new house from their agent.

Exclusive Member Benefits

As you can see, home warranty coverage offers significant budget protection for buyers and sellers alike, plus valuable peace of mind. And there’s even more. A real estate home warranty from First American comes with generous member benefits designed to help make homeownership more affordable.

First American Home Warranty members can simply sign in or register their online account and click Member Benefits to access a range of amazing perks, including:

Savings on home maintenance and improvement projects
Rekeying service for buyers
Big discounts on name-brand appliances, refrigerator filters, HVAC air filters, and more
Optional HVAC tune-up coverage, which provides two pre-season tune-ups per year (spring and fall)
Refer a friend and receive a $100 Amazon gift card when your friend orders a First American home warranty plan
Exclusive $25 Hero Discount for active/former firefighters, law enforcement officers, and members of the U.S. armed forces
... and more!

Prevent Buyer’s Remorse

Buying a home in today’s competitive market can be daunting. When the sale finally closes, it can be a relief, yet also feel intimidating, especially for first-time homebuyers. They’ve budgeted for their new mortgage, but do they have a game plan for tackling repairs or expensive replacements on major home appliances and systems? You don’t want your clients to feel buyer’s remorse because a month into their new home, they’re on the hook for a costly refrigerator replacement. A real estate home warranty plan from First American offers peace of mind by providing:

A convenient, budget-friendly repair/replacement solution when covered household items break
An easy, time-saving way to schedule prescreened service providers
The security and convenience of unlimited service requests via phone or online, 24/7
Coverage that lasts for 12 months after closing and can be renewed annually

Although purchasing a property with a real estate home warranty already in place is ideal, sometimes that’s not possible. Fortunately, you have up to 60 days after the closing date to order coverage for a buyer who has purchased a property without a home warranty. Adding coverage is a great way to maintain client trust and loyalty — and help new homeowners avoid buyer’s remorse.

Getting Into the Home Warranty Habit

Making it a habit to include a real estate home warranty plan from First American in every transaction ensures that your clients are financially protected when covered items unexpectedly break. What’s more, by drawing attention to your listings and attracting potential buyers, home warranties elevate your selling efforts.

Find out more about our home warranty plans and the many benefits they offer, or get a free quote today.