Reduce your maintenance expenses by getting a home warranty plan.

Owning an investment property has tremendous benefits towards your financial security: stable and predictable monthly mortgage payments, mortgage interest towards tax write offs, expenses write off, depreciation, monthly cash flow, equity building as well as being a proud homeowner. However, in order to enjoy all of these benefits it comes with a great deal of responsibilities which is home maintenance. No matter if you are a homeowner owning your own home or as an investor owning a property as a rental property. A home warranty plan can save you a lot of headaches and financial distress. A home warranty plan is different from a homeowners insurance policy. Homeowners insurance policy covers the replacement of your property and items inside in the events of fire, theft, flood or earthquake depends on which coverage you choose. Home warranty plan covers items that break down due to normal wear and tear and not due to the events mentioned earlier. A standard home warranty plan for a single family residence ranges around $300-400 a year. While an upgraded home warranty plan start from $450 and up per year depends on what kind of coverage you choose.

Roof leaks can cause a lot of damages

As an investor, we would like to keep our expenses as low as possible. However, some items can take us by surprise like pipe leaks, roof leaks, heating, AC, water heater or any other appliances break downs…etc. Any of these items breaks down can easily incur hundreds if not thousands of dollars. How many times a year do you get a call from your tenant that something needs to be fixed? With a home warranty plan in place, if an item needs to be repaired and in some cases replaced (depends on your home warranty provider), you only need to pay for the trade call fee ($60-100 each time). Your home warranty company would schedule a technician to inspect the item reported and then let you know if the item is covered or not. Some companies guarantee that if they don’t cover the repairs, your trade call fees will be waived. You may also have an option to hire your own trusted contractor instead of using theirs. As an example, if you have a roof leak…your roof can easily cost $1000 and up to be repaired. However, if you had purchased an upgraded home warranty plan, it may have cost you or the seller (if you had requested the seller pays for it which I recommend all of my buyers and sellers to do) around $500-$600/year. You automatically saved $400 on the repair cost. If you have other items that need to be fixed, your savings add up due to your home warranty plan. Here’s a chart that shows you how much you may be saving by having a home warranty plan: Chart provided by http://www.Bpgwi.com Image I had mentioned earlier that I would recommend the seller to pay for the home warranty plan during a sale transaction, even when I represent the seller in a transaction. The reason is that when a buyer purchases a home, there will be a lot of expenses during their first year of home ownership. This is also the time when they are getting to know their property. No matter how careful the seller and the buyer had conducted their investigations, nine out of ten times there will still be surprises and repairs once the property changes hands. The buyers who had become the new homeowner, may get frustrated to deal with imperfect home which can cost them a lot of money on top of their moving and make ready expenses. This frustration will then funnel back to the seller who the buyers think had “tricked” them into buying a lemon and therefore exploring lawsuits for compensation. If the seller had paid for the 1st year home warranty plan during the sale transaction, the buyers’ expenses to fix any repairs will be limited and therefore, less likely to investigate a lawsuit or complaint on the seller. The buyers will have a peace of mind that these items will be covered by the home warranty plan which was free for them anyways. Despite a seller’s market, sellers should NEVER save money on home warranty plan as this is a protection for themselves also. If you have any other questions regarding purchase and sale of your property, we are here to answer any of your questions: Helen@HaylenGroup.com  or 888-406-5788.

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