Building Forward

Tag: homeownership

  • Home Warranty vs. Home Insurance: What’s the Difference?

    Home Warranty vs. Home Insurance: What’s the Difference?

    Your home is your haven, the place where you and your loved ones feel safe and secure. However, disasters can strike at any time and cause damage that sometimes can be quite expensive to repair. Luckily, you can protect your home by getting the right insurance and warranty policies. Although you may have heard these terms before, do you know the difference between them?

    Many homeowners tend to mix up these policies. While they both protect your home in their respective ways, they serve different purposes. We’ll explain the key differences between home insurance and warranty and why getting both can be essential for your peace of mind and financial security.

    What is home insurance?

    Home insurance is a type of coverage that pays for damage to your home or belongings due to unexpected events such as fire, storms, and theft. It’s required by mortgage lenders and can also provide liability protection in case someone gets injured on your property.

    Home insurance policies cover damages to the physical structure of your home and your personal property like furniture, appliances, electronics, and other items. Depending on the policy, you may also be covered for loss of use or additional living expenses if your home becomes uninhabitable due to covered damage. It’s important to note that not all types of damage are covered by home insurance and some exclusions or limitations may apply.

    Home Warranty vs. Home Insurance: What's the Difference?What is a home warranty?

    A home warranty is a service contract that covers the repair or replacement of home appliances and systems that fail due to normal wear and tear. Commonly covered items include heating and cooling systems, plumbing, electrical, kitchen appliances, and water heaters.

    Unlike insurance, which covers unexpected events, a home warranty is designed to cover the costs of repairing or replacing items that are likely to break down over time due to regular use. Home warranty plans require an annual fee and may also require a service fee or deductible for each service call.

    Why you may need both home insurance and home warranty

    Home insurance and home warranty are different types of protection, but are complementary and can provide a comprehensive insurance plan for your home. Your insurance covers the structure and contents of your home, including any liability to any guests on your property. Your warranty helps manage the high costs of repairing or replacing appliances and systems that aren’t usually covered by insurance.

    Suppose a severe storm hits your home, causing flooding and damage to some of your belongings. In that case, your home insurance policy will step in to cover the damage, replacement, and repair costs.

    On the other hand, if your air conditioner or refrigerator suddenly breaks down due to normal wear and tear, the cost of repairs or replacement may be expensive. With a home warranty, you can get it fixed or replaced without paying the high cost out of pocket.

    Taking care of your home is essential for your comfort, safety, and financial stability. By understanding the differences, you can make informed decisions about the types of protection you need and ensure that your home is adequately covered. Keep in mind that every home and homeowner is different, so it’s important to compare policies and speak with a knowledgeable insurance agent or warranty provider to find the best options for your unique situation. With the right protection, you can relax and enjoy your home without worrying about unexpected repairs or damages.

    Home Warranty vs. Home Insurance: What's the Difference?Customer Care from S&A Homes

    At S&A Homes, we provide an unbeatable, fully transferable 10-year warranty for our homebuyers’ convenience and peace of mind. We have a dedicated Customer Care Department available to simplify the claims process and make sure nothing goes unnoticed. It’s one of the many reasons why we have one of the highest customer satisfaction rates in the homebuilding industry!

    Find Your New Home with S&A Homes

    We hope you’ll consider S&A Homes when you’re ready to make the move into a new construction home.  We invite you to learn more about new home opportunities from S&A Homes throughout Central and South-Central Pennsylvania. Call 1-855-SAHome1 or visit SAHomeBuilder.com to learn more about our new home communities, build on your lot opportunities, floorplans, and more.

  • Budgeting for New Homeowners: What to Expect

    Budgeting for New Homeowners: What to Expect

    Budgeting for New Homeowners: What to ExpectBecoming a homeowner is such a rewarding moment, but it’s also a significant financial responsibility. Apart from paying for your mortgage, several expenses need to be factored into your budget to maintain and protect your property. 

    We’ll discuss some often-overlooked expenses you should include in your budget for the first year of homeownership. By understanding these costs, you can start planning and budgeting accordingly, ensuring you maintain your property and successfully navigate your first year as a homeowner.

    Mortgage Payment

    The first bill you’ll need to budget for is your mortgage payment. A mortgage payment is made up of four main parts: principal, interest, taxes, and insurance. The principal pays down your loan amount while interest covers the cost of borrowing, including your interest rate and remaining balance. The amount of interest you pay is determined by your interest rate and your loan balance. 

    Budgeting for New Homeowners: What to ExpectTaxes and Insurance

    The third component of your mortgage payment is taxes. Property taxes is one of the significant expenses that come with owning a home. Taxes are usually based on your home’s value, location, and local tax rates. These taxes can be due quarterly or annually, depending on where you live.

    The final part of your mortgage payment includes insurance. Homeowners insurance is required to protect your property in case of theft, natural disasters, or accidents. The cost of your premium will vary depending on factors such as your location, the age of your home, and the level of coverage you want. Remember that insurance policies cover different types of losses, so make sure to read and understand the terms of your policy.

    If your down payment was less than 20%, your lender may require private mortgage insurance (PMI). This insurance protects your lender in case you are unable to repay your mortgage. This amount is typically added to your mortgage payment.

    You have two options for paying your property taxes and home insurance. The first option is to pay them yourself directly. You will need to figure out how much to set aside each month to cover these costs. The second option is to establish an escrow account with your lender to manage these payments. Each mortgage payment will add 1/12th of the total annual bill to cover these costs and will issue payment when they’re due. 

    Utilities

    Utility bills such as electricity, water, and gas make up a significant portion of homeownership expenses. You should anticipate higher utility costs than when renting, especially if you have a larger home or more family members. When budgeting for your first year, take note of the average utility bills in your area and leave some cushion for fluctuations.

    Home Maintenance and Repairs

    As a homeowner, it’s your responsibility to keep your property in good condition. This means setting aside money for routine maintenance and repairs like cleaning gutters, mowing the lawn, fixing a leaky faucet, and so on. You should also be prepared for unexpected repairs like a damaged roof or plumbing issues. A general rule of thumb is to set aside 1-2% of your home’s value for maintenance costs.

    When you purchase a new home with S&A Homes, we provide our buyers an express 10-year limited warranty on their new home so you can enjoy peace of mind.

    Homeowners Association Fees

    If you live in a neighborhood with a homeowner’s association (HOA), you will likely be required to pay a monthly or annual fee. These fees are used to maintain shared community areas, such as parks, playgrounds, and pools.

    Budgeting for New Homeowners: What to ExpectHome Improvement

    Finally, while it may not be necessary in the first year, any home improvements, such as remodeling your kitchen or adding an extra bathroom, need to be included in your budget for the long term. These types of projects can be costly, so consider the costs, benefits, and long-term goals before making any home improvements. Setting aside money over time will make sure you have the funds available when it’s time for updates.

    The first year of homeownership can be both exciting and challenging. However, it’s essential to understand that homeownership comes with financial responsibilities and costs. As a homeowner, you should be prepared to budget for the full cost of homeownership. These expenses can add up quickly, so it’s vital to plan accordingly and avoid financial surprises. With careful budgeting, you can manage these expenses stress-free and enjoy the benefits of homeownership.

    New Construction Homes by S&A Homes

    S&A Homes is proud to build affordable new home communities throughout Central and South-Central Pennsylvania. We invite you to learn more about our new home opportunities, whether building on your lot or buying a home in one of our new home communities. Call S&A Homes at 1-855-SAHome1 or contact us online to learn more about our available inventory and communities.