Buying a home is a huge step that comes with a lot of responsibility. When renting an apartment or house, any repairs that need to be done to a property are covered by the landlord or property management company. As a homeowner, you are responsible for arranging and paying for your own home’s repair. First time home buyers are often caught off guard by the cost of routine as well as unexpected repairs that come along with owning a home. Purchasing a home warranty for your home is a great way as a first time home buyer to protect yourself from the cost of unexpected repairs with your new home.
Repairs for Your New Home
All of the systems and appliances in your home have a life cycle and can go at any time. It is important to be prepared for the unexpected when buying a new home. Your heating system could go down in the middle of the night mid February when the temperatures are hovering around freezing. Who would you call, how much will this cost you and how quickly will this be resolved? The cost of the repair and choosing the right person who will give you the best results at a reasonable price is usually the biggest concern for new home owners. How do you protect yourself and prepare for one of your vital systems or appliances to break down? One way to prepare yourself and cushion the blow of a costly repair could be a home warranty.
Who Should Purchase a Home Warranty?
If you are a handyman (or woman) who feels confident in their ability to fix anything, a home warranty might not be necessary. However, if you are not very handy, you might want to consider a home warranty. People who are used to renting and relying on a landlord to fix various problems are good candidates for home warranties. Real estate investors who are not able to do repairs for their tenants purchase warranties to avoid the hassle and headache of arranging repairs for their tenants. A lot of people work long hours, and do not have the time to find the right repair person to get the job done right the first time, so home warranty companies are a great solution.
What is a Home Warranty?
A home warranty is similar to that of an extended warranty if you were buying a car at the end of their factory warranty or an insurance policy on your smartphone to cover screen or water damage. For about $300-$900 per year, you could purchase a home warranty. If one of your system breaks, all you have to do is contact your home warranty provider to tell them what has broken. You could usually either call them or submit a claim online on their website. The home warranty company will then contact the contractor they have a relationship with to go to your home and repair or replace the system or appliance. For every incidence you will be responsible for paying a co-pay (as you do with insurance), but all other repair costs or replacement costs are covered by your policy.
When Should I Purchase a Home Warranty?
You can purchase a home warranty at any time. You do not have to make the decision when you first buy your home whether or not you want to make the commitment of choosing the right home warranty. It is important when considering a home warranties that you do your homework and shop around. All warranty programs are different, so you want to make sure you inspect the different policies to see what is covered and what the premiums come to. Keep in mind that the older your home is, the more coverage you will need. If you got a home inspection before purchasing your home, you will have a general idea as to the life expectancy of your appliances and services. Pick a home warranty that fits your home’s needs.
Home Warranty vs. Home Insurance
Home warranties are often confused with home insurance. Both warranties and insurance protect your home, but they cover completely different things. Home Insurance covers: roof damage from a hail storm, damage from a tree limb knocked into your window during a storm or a kitchen fire damages the walls. A home warranty would cover: your ac stops working suddenly, the oven is not working or your furnace won’t turn on. Home insurance covers most damage done to the structure of your home. A home warranty covers the repair or replacement of the SYSTEMS inside of your home due to normal wear and tear. If your clothing dryer door falls off because it’s old and has been used countless times, that would be considered normal wear and tear, which would be covered in your warranty. However, if your clothing dryer door falls off because your two year old was jumping on it when it was opened, that would not be considered normal wear and tear, therefore not covered by your warranty.
Should You Consider a Home Warranty?
Being a first time home buyer, you may feel overwhelmed by the whole home buying process. Check out our blogs Top Home Buyers Fears & How To Face Them and First Time Home Buyers Mistakes to Avoid. If you are a first time home buyer, do your research and find out if a home warranty is the right choice for you. Check out a couple of different warranty vendors to see what they offer and at what cost. Some properties will offer home warranties when you purchase the home. Sellers sometimes offer a home warranty as an incentive to purchase their home. There is no rush, so there is no need to decide before purchasing your home whether or not you want to buy a warranty before moving forward with making an offer on a home. Some people have the advantage of having a family member or friend who is an electrician or plumber so they do not have a hard time finding a reliable contractor when problems arise. However, if you do not have those connections, it can be hard to find a contract that is trustworthy to get the job done right the first time.
If you have questions about your real estate purchase, contact the professionals at Leighton Realty. Michael Leighton has been the #1 Agent at Ocean Edge since 2004 and the #1 Agent for the town of Brewster since 2007.
