The First Time Buyers Home Maintenance Plan
While buying a first home tends to be a very exciting experience, it can soon become a rather shocking one when first time home buyers are suddenly confronted with things they never dealt with while renting. Most notable among those things are the cost and time involved in home maintenance and repair.
For example, when there was a plumbing issue in the apartment you could simply call the landlord and he would send over a plumber to fix things at his expense. But the first time a new homeowner experiences the plumbing issue in his own home, he realizes he will either spend the time to fix it himself or pay a hefty price out of pocket for a plumber.
The fact is maintenance is part of owning a home. Furthermore, it's an ongoing process that will continue throughout the life of your ownership. For first time home buyers who are not really acquainted with maintenance issues, a first time buyer’s home maintenance plan is a good idea. These plans are also known as "home warranties" and are not confined simply to first time home buyers. They are simply referred to as such because first time buyers are the most likely ones to use such a service.
Home Maintenance Plan Defined
A home maintenance plan, or warranty, is more or less like any other type of warranty you would buy. For a certain amount of time as stipulated in the contract, the major structures and components of your home will be covered in case something goes wrong. Say you moved in to your new home in August, and then discovered during the first part of November that your furnace is no longer working properly. The warranty will provide for a repair technician to visit your home and fix the furnace. You may have a small deductible depending on the warranty program, but the major portion of the expense will be covered for you.
Generally these home maintenance plans are pretty inexpensive when you compare the potential cost of all the repairs they cover. At $200-$400 for a one-year plan, that's not bad. Using the previous example of a broken furnace, without the warranty you could easily spend $400-$600 simply replacing the computerized motherboard on your furnace's control system. If money were tight you would just have to hope your water tank or roof didn't bite the dust anytime soon.
What a Home Maintenance Plan Covers
Just like any other kind of warranty, what a home maintenance plan covers depends on the type of coverage the purchaser acquired. You can get simple, basic plans that cover things like water tank, furnace, gutters, and windows. Or, you can get a comprehensive plan which covers just about everything in the house. It just depends on the amount of money the purchaser of the plan is willing to spend on it. Also keep in mind that the price of a home maintenance plan is also partially determined by the length of the contract. Typical home mortgages are only good for one year, though it is possible to get them for longer periods of time.
Who Purchases the Home Maintenance Plan?
Who purchases the first time buyers home maintenance plan is really up to the two parties involved. More often than not the seller purchases it because it increases the value of the home and makes it easier to get the asking price. That being said, there are plenty of scenarios which have the purchaser buying the plan on his own prior to closing. Regardless, the home maintenance plan should always be part of your sales negotiations if, as a first time buyer, you're unfamiliar with home maintenance and its cost.
In a booming market it's not uncommon for real estate agents to provide 1st time buyers with a home maintenance plan free of charge. Real estate agencies consider this a gift to thank the customer for using them. In a less frequent circumstance, some state mortgage assistance programs require a warranty to be provided by law. Regardless of your circumstances, be sure to check with your real estate agent for the availability of a first time buyers home maintenance plan and who will pay for it.
