Oregon Real Estate Practice Test 2026 – Your All-in-One Guide to Exam Success!

A home warranty in real estate transactions refers to a service contract that provides coverage for the repair or replacement of major home systems and appliances, such as plumbing, electrical systems, heating, and cooling systems, as well as kitchen appliances. This warranty is typically purchased by the seller or as a part of the purchase agreement by the buyer, to give peace of mind regarding potential repair costs that may arise after the sale of the property.

This coverage is particularly valuable for both buyers and sellers because it can make the home more attractive to prospective buyers while also protecting the buyer's investment in the event that something goes wrong shortly after purchase. The service contract can help mitigate the financial risk associated with unexpected repairs, ensuring that the new owners have a reliable system to handle such issues without incurring prohibitive costs immediately after moving in.

The other options do not accurately represent the function of a home warranty. The first choice describes a buyer's obligation rather than a warranty concept. The third option implies a warranty on the structural integrity of the house, which is not the purpose of a home warranty; such assurances typically fall under different types of warranties. The fourth option suggests limited or temporary coverage, whereas home warranties are designed to provide ongoing coverage for a specified term, usually one year