Understanding Home Warranties for Flippers

A home warranty is a service contract that covers the repair or replacement of major home systems and appliances for a specified period — typically one year. For fix-and-flip investors, offering a home warranty with the sale provides buyer confidence and reduces the risk of post-closing repair requests.

Standard home warranty coverage includes HVAC systems, plumbing (supply and drain lines), electrical system, water heater, kitchen appliances (dishwasher, garbage disposal, range/oven, built-in microwave), and sometimes the washer and dryer. Enhanced plans may include roof leak coverage, pool/spa equipment, and well/septic systems.

Cost ranges from $350–$650 for a standard plan to $600–$900 for comprehensive coverage, paid at closing. The seller (you, as the flipper) typically purchases the warranty and it transfers to the buyer at closing.

The benefits for flippers extend beyond buyer appeal. It provides a layer of protection against post-closing complaints and demands. If a buyer discovers an issue with a covered system within the warranty period, they call the warranty company rather than demanding you fix it. This can prevent costly disputes, negative reviews, and potential legal claims.

Timing matters. You can also purchase a listing warranty that covers the property while it's on the market (typically $50–$100 for 6 months). This protects you against system failures during the marketing and sale period — imagine your HVAC dying during a heat wave while you have active showings.

Choose a reputable warranty company with good reviews and a strong contractor network in your area. Companies with poor service reflect badly on you even though you're not the provider. Major national providers include American Home Shield, First American Home Warranty, and Choice Home Warranty.