Home Warranties are Great for First Time Home Buyers

In December of 2007 I purchased my first house, which was also a foreclosure.  Per the advice of my Realtor, Brenda Richterkessing, I purchased a home warranty which was paid for by the seller at closing.  Since the property was a foreclosure and had some older home systems (outdoor AC unit, furnace, refridgerator, and a few others) the home warranty made a lot of sense to purchase.  In addition, I had limited funds after making this major purchase.  If I were to have an unpredicted major expense to repair or replace something I would be up a creek!  The Old Republic Home Warranty that I have on my home systems, appliances, and swimming pool have saved me from numerous financial crisises.

Home warranties help you budget for the repair and replacement of major home systems and appliances.  Most home warranties will cover Plumbng, Electrical, HVAC systems and kitchen appliances.  In addition, many hom warranty companies provide optional coverage choices that can be purchased to “custom fit” the Plan to the unique needs of your home.  This means that you could also include your swimming pool or roof in the plan as well!

There are many home warranty companies to choose from…I recommend using either Old Republic Home Warranty or American Homeshield Home Warranty.  Most home warranty company’s offer a basic/standard plan that typically ranges from $350 to $500 per year with a fee per service call between $55-$75. 

Here’s how a home warranty works:

• You pay an annual rate to cover your home’s systems and appliances (renewable each year)
• You can opt to have additional coverage to “custom fit” the plan to your home
• The plan you choose will determine the deductible that you will pay each time a service technician comes to your property
• When a home system or appliance needs to be repaired or replaced you contact the home warranty company and inform them of the problem
• The home warranty company will provide you with the contact information of a preferred vendor that will contact you to setup an appointment
• The service technician will usually be out to your house within 24-48hrs.
• If needed repair or replacement is covered by your plan, then you pay your deductible ammount and the home warranty covers the remaining balance
• If needed repair or replacement is not covered by your plan, you pay the deductible ammount and have the option of paying the technician out of pocket o resolve the problem

In an eight month period I have used my home warranty plan a total of five times and only one issue was not covered under my plan.  As a result of my plan the following reapirs have been covered:  kitchen faucet replaced, garage door opener sensors replaced, outdoor condensing unit (AC) replaced, and a new AC fan motor installed.  (To date I have saved thousands all as a result of having a home warranty)

I strongly urge anyone to purchase a home warranty and renew it every year…at the very least, look into what the cost would be for a plan that fits your needs.  A home warranty plan is great for the first time home buyer, older homes, investment homes, or rental homes.  I have avoided situations of extreme stress as a result of having a home warranty plan…you could to!

Have you saved money by having a home warranty?  Tell us about it.

The Beginning of the End of Super-Low Mortgage Rates?

There are several factors that indicate that home buying will be increasing which in turn will help fuel a recovery of the housing market.

The National Apartment Association recently conducted an online poll in which results showed 17 percent of renters plan to purchase their first home within the next year; 41 percent of the 2,041 respondents planned to be home owners within two years.  Only 31 percent planned to still be paying rent five years from now.

The past six months have seen a drastic drop in mortgage rates, however fixed-rate mortgage rates rose to 6.32 percent, the highest it has been since October.  Following the months of aggressively dropping interest rates, many feel that the Fed will be forced to raise rates back up.  If interest rates rise, so to will mortgage rates.

According to a press release by Freddie Mac, Frank Nothaft, Freddie Mac vice presient and chief economist said that, “Mortgage rates jumped this week after a number of Federal Reserve officials, most notably Chairman Bernanke and Vice Chair Kohn, expressed concern over a threat of inflation.” We may very well be seeing the beginning of the end of the super-low mortgage and potential buyers may realize that with rising rates, now may be the time to jump in. Nothaft added, “Moreover, pending home sales for April unexpectedly rose by 6.3% and mortgage applications for home purchases … were also up last week.”

Terramont Subdivision in Roswell is a Great Place for First Time Home Buyers

For those of you that may not know, I purchased my first home, a foreclosure in Terramont Subdivison in December of 2007. I initially looked at homes in Roswell in the subdivisions of Lake Forrest, Martin’s Landing, Sherringham, and Barrington Farms as well as in the subdivisions of Berkshire Manor and Summercrest in Alpharetta. As a first time home buyer I wasn’t looking to spend much over $200,000. I really love Terramont Subdivision because of it’s great location, just off of Holcomb Bridge Road and close to Georgia 400. It is close to both Perimeter Mall and North Point Mall and not a far drive to downtown Atlanta and lots of restaurants.