Buying a home is never easy, but now the hard part is done: You’ve found your dream home, signed on the dotted lines, and have either moved in or are in the process of moving into your new home. Now, after shelling out all that cash for a down payment and other moving expenses, you may be wary about spending more money. 

We get it. Buying a house can be stressful, especially if you’re a first-time buyer, and is a huge investment. But consider buying a home warranty after closing to save money as a new homeowner.  

Wondering when to buy a home warranty? You can buy one at any time, but just remember that it’s better to have a budget protection plan in place sooner rather than later. A home warranty actually helps you save money on inevitable repairs to those new (or old) home systems and appliances.  

So if you didn’t secure a home warranty when buying a house, you should get one now that you’re a homeowner. Here’s what to consider when purchasing one after closing and what your options are. 

What a Home Warranty Does and Does Not Cover

First, let’s understand what a home warranty is not.

A home warranty is different from a builder’s warranty on a newly built home. New builds often come with a warranty from the construction company, the terms of which are usually dictated by state law. It’s important to note, though, that these warranties typically only last 12 months past the purchase or installation date of your systems and appliances, and they only apply to the original purchase by the original owner. If you’re buying a new construction home, it’s a good idea to understand what your builders warranty covers—and supplement it with a home warranty, if necessary.  

A home warranty is also different from homeowners insurance, which covers the structure of your home and the personal property within it against catastrophic loss due to things like fire, theft, or acts of nature.  Learn more about the differences in our Home Warranty vs. Home Insurance blog post.

So, what is a home warranty? Instead of covering the structure of your home or belongings against damage, loss, or theft, a home warranty offers budget protection to help you manage the cost of repairing or replacing covered home systems and appliances when they break down due to normal wear and tear. Your home warranty covers your major appliances, like your refrigerator, stove, dishwasher, or microwave, and your home systems, like HVAC, electrical, and plumbing, depending on your plan coverage.  

Find out exactly what’s covered in a home warranty as well as who pays for a home warranty. 

The Importance of a Home Warranty

Obtaining a home warranty after buying a house is probably one of the smartest investments you can make. Why? Because your homeowners insurance only covers what could happen (like a fire or flood). A home warranty, on the other hand, covers what will happen (like an appliance breakdown).  

As much as we would all love to believe that a new-to-you home equals no future issues with its major appliances and systems, that’s just not realistic. There’s no way you can know what has happened in your home before you owned it. Have the previous homeowners kept up with their maintenance responsibilities? Did they make sure the work was done right, or did they wing it and cut corners to save a few bucks?  

Additionally, you can’t always see the defects in your home’s systems and appliances by looking at them or even by testing them. Repairing an appliance or home system that breaks down suddenly can wreck a carefully calculated budget. Even cheap home repairs can cost a few hundred dollars, and if you end up needing to replace an expensive home system or appliance, that could cost hundreds or even thousands.  

If you get a home warranty after buying a house, you can rest assured that those covered breakdowns will be resolved.