Do First-Time Home Buyers Need a Home Warranty?

The short answer is yes. Buying your first home is a huge milestone—and it’s also a huge investment. Between your down payment, mortgage, home inspection, and closing costs, your wallet is probably already feeling stretched.  

Here’s why a home warranty for first-time buyers can really help you with home ownerships costs and protect your all-important budget.  

Why First-Time Home Buyers Should Consider a Home Warranty 

Homeownership comes with surprises and expenses. 

Imagine this: your AC stops working during a heat wave. repair or replace an AC without a home warranty could be up to $6,000.^* Yikes. Here’s the kicker, your homeowners’ insurance won’t cover that. But a home warranty could provide budget protection if you AC suffered a covered breakdown. 

Home warranties help protect your budget  

When you purchase your plan and make your monthly payments, a home warranty could reduce the costs of covered breakdowns to a relatively small service fee, usually $125 or less. 

Peace of mind you can budget around 

As a new homeowner, it’s comforting to know that if something breaks, it won’t break your budget. A home warranty provides financial protection and confidence – two things every first-time buyer deserves. 

Real Buyer Story: “I have recommended this company to a lot of people. My sister is in that process of buying a house. I've already given her the information! Excellent company, excellent service.” – Murial J. 

What Is a Home Warranty, Anyway? 

A home warranty is a contract that helps reduce the costs when covered systems and appliances experience covered breakdowns from routine wear and tear. Think of it as a safety net that complements your homeowners’ insurance.  

Covered items typically include: 

• HVAC systems (heating and AC) 

• Electrical systems and wiring 

• Plumbing systems (even pipe leaks) 

• Water heaters 

• Kitchen appliances like refrigerators, ovens, and dishwashers 

As time goes on, all these components break down. A home warranty makes those moments a lot less painful... and a lot more manageable. 

Home Warranty vs. Homeowners Insurance 

It’s easy to confuse the two, but here’s a quick breakdown: 

How Does a Home Warranty Work? 

Here’s how a 2-10 Home Buyers Warranty (2-10 HBW) plan agreement typically works: 

1. A covered item experiences a covered breakdown. 
2. You check your plan agreement (online in Homeowner Portal) to confirm your coverage. 
3. You submit a service request online or by phone (24/7). 
4. A vetted quality, independent service Pro is dispatched to your home. 
5. You set up an appointment that works for your schedule. 
6. You pay your Pro your service fee. 
7. Your Pro diagnoses the issue. As long as it's covered, your Pro repairs the breakdown or replaces it if repairs don't solve the issue. 

And that’s it. No hunting for a contractor. No surprise bills. Just simple, budget-friendly repairs. 

Can a Home Warranty Be Transferred? 

Yes, home warranties can be transferred or converted in a real estate transaction.  

For example, if you had an active home warranty and sold your home, you could transfer that home warranty to the new owner, who would then ride out the remainder of your term.  

In another scenario, you might not have active warranty coverage but decide to sell your home and enroll in Seller Coverage. When you sell your home, you'd have an opportunity to convert your Seller Coverage to Buyer Coverage as an incentive for potential buyers.  

In a final scenario, if you're in the process of purchasing a home, your real estate agent may choose to purchase a home warranty for you as a gift. 

Are Home Warranties Just for Old Homes? 

Not necessarily. While many homeowners understand the value of a home warranty for older homes, since older homes likely have older systems and appliances that might be more likely to break down from routine use, even new items can break down.  

Whether your home is brand new or pre-owned, a home warranty can help you protect your budget against expensive, covered breakdowns. 

Does Location Affect My Home Warranty Needs? 

Absolutely. Your home’s climate and features can help determine the right coverage. 

For example: 

• Hot & humid climates? You’ll want strong AC coverage. 

• Swimming pool or spa? Opt for optional add-on coverage. 

• Older plumbing or electrical? A system-focused plan may be best. 

Always review the plan agreement to ensure it aligns with your specific home and region. 

How Much Does a Home Warranty Cost? 

On average, a home warranty ranges from $350 to $800/year. Depending on your needs, pricing can range between $300 to $1,000+ annually. Many companies, like 2-10, let you pay monthly or annually. 

Good news for first-time buyers: Sometimes the seller or your real estate agent will include the warranty in your closing costs – or even gift it to you! 

Final Thoughts: Should You Get a Home Warranty? 

If you're a first-time home buyer, a home warranty isn't just a nice-to-have—it's a smart, budget-friendly tool that helps you protect your investment and your peace of mind. Whether it’s your AC in July or your fridge in January, you’ll be glad you planned ahead. 

Want to Learn More? 

Explore more about 2-10 flexible coverage plans here or reach out to their friendly team to get started. Your future self – and your wallet – will thank you.   

^*Repair/replacement cost is the eightieth percentile as reported in a nationwide survey of homeowners conducted in 2024 by ClearVantage for Frontdoor, Inc.