Craig Elliott asked:


Buying a home for the first time is very exciting – no more renting, you are now paying and investing in yourself by paying your mortgage. However, through all the excitement of a mortgage and buying a new home, it’s easy to get carried away and to forget some important things you should be looking for. It would be awful if your first home buying experience turned out badly and you bought a house that was a money pit because you didn’t take a few moments to look at all the aspects.

One of the key things first time home buyers should do is look into home warranties. A home warranty works similarly to warranties that you have on your vehicle or your appliances. You wouldn’t buy a new car or an appliance without a warranty, so why would you make the biggest purchase of your life and not get a warranty? Home warranties cover a variety of major repairs that may happen after you purchase the house. Home warranties are available for both new homes and older homes.

Either the buyer or seller can purchase a home warranty. If the seller has purchased the home warranty, it’s because they are trying to secure their pricing on the home and sell their home faster. As a buyer, you would purchase a home warranty as a safe guard against any major reparations that need to be done to the home that you couldn’t see, or tell, when you purchased the house.

Regardless of who purchased the home warranty, it is important to look at the coverage that is offered by the company. Coverage varies from company to company and state to state. When you talk to a home warranty agent, or look at the sellers’ policy, be sure to ask what is and is not covered on your home warranty specifically.

Most home warranties will cover:

Air conditioning system

Built in dishwasher

Built in microwave

Built in trash compactor

Ceiling fans

Central heating unit

Duct work

Electrical systems

Garbage disposal unit

Plumbing systems

Refrigerator

The oven or range

Washer and dryer

Water heater

Most of everything else is not covered. This includes:

Outdoor sprinkler systems

Outdoor water systems

Faucet repairs (unless otherwise stated in the policy)

Spas (you can request/add this coverage in some cases)

Pools (you can request/add this coverage in some cases)

Hot tubs (you can request/add this coverage in some cases)

Permit fees

Hauling away debris

Hauling away old appliances

It’s also important to find out when a request would be denied. There are plenty of reasons why a home warranty would be considered void, including:

Improper maintenance

Improper installation

Code violations

Unusual wear and tear

It is a good idea, when you buy your first home, that you have an inspection done on the house to ensure that it is properly up to the building codes and that there are no code violations and that the major systems and appliances in the house are properly installed and that they’ve been properly maintained.

Buying a home can be so exciting that you may jump at the first house that meets your needs and your budget – many people have been there. It’s always a good idea to take a step back from the situation and really look at the house – is this where you want to live for at least the next three to five years? Is it what you hoped it would be? Are there other homes that you are considering?

In some cases, having a home warranty can make or break the decision to purchase your first home. Most often, first time home buyers aren’t entirely up on what they are taking on – there’s no landlord to call if the pipes burst – that’s for you to handle. No heat? No hot water? You have to pay to replace and fix those items. These items cost up to thousands of dollars – do you have the money to fix and replace these major items, such as the electrical system, major appliance, hot water heater or furnace if they should stop working? This is why it’s always a good idea, especially for first time home buyers, to purchase a home warranty to protect them from the sometimes incredible expense that is associated with owning your own home. When you look for a home warranty, be sure to ask lots of questions and get a few quotes so you can compare the coverage on the home warranties and the rates that you will be charged.



Jack

Stephanie Larkin asked:


Buying your first home is exciting. No more rental payments to a landlord making money for someone else. Instead, you are purchasing your own home and investing in yourself. Money paid to your home mortgage is really investing in your future. It is no wonder that first time home buyers are so excited, sometimes so excited that they make mistakes. There are a few common mistakes of first time home buyers, which with some knowledge and direction can be avoided.

First of all, it is always good to research the housing market and see what is out there. Yes, the very first house you look at may look like its perfect, but there are others out there for sale too. Be sure to at least look at a few before deciding on the one you want to buy.

Watch the cost of the home, do not be swayed into thinking that you can not barter down the cost of the house, you probably can.

Insist on a home inspection by a qualified inspector. There are plenty of people who will provide you with a home warranty when you buy their house and try to sway you from having the house inspected.

Having a home warranty is important and many first time home buyers just don’t know that they should or could get one when they are buying an older home. Home warranties are not a new product; they’ve been around for many years, but many people think that they are for new homes only, not realizing that they can be purchased for older homes as well.

A home warranty makes great sense when you are purchasing an older home – you just don’t know the house very well until you’ve lived in it. A home warranty protects first time home buyers from major expenses for repairs and replacements that could come up.

A first time home buyer can make a major mistake if he or she does not understand that if something goes wrong, they are fully responsible to fix it. There is no landlord to call and the costs are all theirs to bear. This is one of the major reasons it is so important to invest in a home warranty when you purchase an older home. If any major repairs need to happen, most often the home warranty will cover the costs, making owning a home much more feasible.

When looking for a home warranty, it’s important to have a basic understanding of what you are looking for. When you talk to an agent, there are many questions that you need to ask to be sure you know what level of warranty you are getting. Questions to ask include:

What is covered with the home warranty? Most often the electrical system, plumbing system, heating system, cooling system/air conditioning, and major appliances that are covered under the warranty.

What is excluded from coverage with the home warranty? Most often this includes outdoor water, including the sprinkler system, faucet repairs, hot tubs, pools, spas and costs of hauling away debris and old appliances.

What are the rates/premiums? How much will you have to pay for the home warranty?

What is the deductible on the home warranty? The deductible is how much you will have to pay when you make a claim. Most often the deductible is $50, this amount will be deducted from the overall cost of the reparations paid by the warranty company.

How long is the warranty active for? Most often home warranties are offered in one year terms.

Is the warranty renewable at the end of the term? If you’ve purchased it yourself as the buyer, it is likely renewable. However, if the seller purchased the home warranty, it will not be renewable.

What are the terms of the warranty? When will the warranty be void? Most often if you’ve misused the item, or if it is not up to code or not installed properly, your warranty will be void and will not cover any reparations.

How are claims handled?

How do I make a claim?

With the above information, first time home buyers can avoid some of the serious mistakes that are usually made, and then go through with their home purchase knowledgeable and safe from the fall out of a potentially serious mistake. Mistakes such as the ones listed above can land a first time home owner in serious debt paying for repairs they were not prepared for financially. Owning a home of your own is very exciting, especially a first home, but make sure you go into it with your eyes open, your finances secure and a plan for the future should a problem rise with one of the major components of the home.



Howard