James Conley answers:

This is a common feeling by a few buyers after the close of a property purchase.

You have insurance that would normally cover any natural disasters, fires, or things that would happen that you are unable to control. If you would have a major break in your water pipes or in your home you would be abel to make a claim against your insurance company. It would be to yo benefit to read your policy and find out your deductible.

Normally if you reside in a flood zone you would be required by your mortgage lender to purchase flood insurance. Your appraiser would have annotated on your appraisal report if you lived in a flood zone. Flood zones are determines by the United States government.

There is a home warranty policy that could cost you anywhere from $400.00 to $700.00 that would cover any and all your appliances, garage, Air conditioner and heating units, electrical, plumbing and other break downs that might happen. You would be required to pay a small service fee each time you have a technician come to your house to repair anything. This fee could be anywhere from $45.00 to $150.00.

There is also an insurance policy you are able to obtain that would pay your monthly mortgage payments in the event you are laid off, fired or have a medical problem that would prevent you from working.

You may google each of these type insurance companies followed by the city and state in which you reside.

Even with these two very necessary insurance policies, you would need to invest in yourself by having a savings account to cover your other expenses, not covered by your insurance. This is very important for your financial security. This savings would cover immediate needs as well as emergency funds in the event of a tragedy or death that might happen in your family. You would have sufficient funds to travel to an emergency and still pay your monthly debts.

Having these three insurance policies along with a savings plan would relieve you of most of your anxieties so you are able to enjoy your house.

I hope this has been of some benefit to you,good luck.

“FIGHT ON”

James Conley answers:

After doing work with a few different home warranty companies in the past I can say most are not worth what you’ll pay for them yearly… You still pay a trip fee most times for the service man, and honestly its rare for most homeowners to get even the 400 a year in service, with the HVAC units they have a cap on what they contribute, and most times they will repair old appliances as long as the repair is under a set price for a new one, even when advised by the tech that a new one is the best approach. I have also seen that they have a previously existing problem clause in the contract, so if the ac or furnace breaks too soon after coverage starts, its not covered anyway.

James Conley answers:

Time to draw up a budget. You have to write down every expense you will have when it comes to living on your own (or with a room-mate). You can ask your parents to go through their budget with you but for starters you need to consider rent, any utilities that you might be required to pay (electric, gas/oil/propane heating, cable tv, internet access, phone service, sometimes water/sewer utilities and even garbage pick up fees). If you’re renting an apartment, there may be additional fees required like a parking fee if you have a car and sometimes a one-time new tenant fee. If you’re renting a house, you might be responsible for upkeep and replacement of any appliances that come with the place and responsible for keeping the landscaping up. Some of these things are negotiable so you should make sure you read over the lease very carefully to make sure who is expected to do and pay for what and if you want to negotiate anything you need to do it BEFORE you sign on the dotted line (and cross out and/or add verbage to the standard document then you and the landlord both initial any changes). Also, always ask a potential landlord for estimates of what your utilities might be – they should have a good idea but understand that these amounts fluctuate monthly and the bills will probably be in your name so you can’t argue with your landlord that the fees are more than you expected since you are responsible for the bills no matter how high they get. When it’s really hot out your electric bill will be high if you have air conditioning. Same thing goes for if it’s really cold out – your gas/propane/oil/electric bill (depending on how you heat your place) will be high. You have to plan for a higher bill in the summer and in the winter. You also need to consider your other bills to make sure you have enough money to cover your expenses after your rent is paid. Are your car insurance/fuel, car payment or public transportation fees accounted for? Do you have enough money for food? Do you have money for entertainment and dining out? How about emergency savings for things like car maintenance (oil changes, new wiper blades, new battery, new tires) or car repairs? Can you put a little aside for once-a-year, large expenses like holiday and birthday gifts or travel? It can be pretty eye opening the first time you are responsible for paying for your own living expenses. It might make you appreciate your parents a little more 😉 Anyway, a budget really is the best way to go. If you live within your means, a life outside of your parent’s home can be pretty rewarding, satisfying, exciting and liberating. The best rule of thumb is to buy the best, cheapest place you can afford. Too many times people just starting out on their own think they need something “bigger” or “fancier” to impress their friends but, honestly, nobody cares and then they’ve overextended themselves and have to resort to living off of credit cards. Since you will need to live on a budget you’re much better off going for smaller and cheaper so you can spend your money on more important things like a dinner out with friends or saving for an emergency or special trip. Believe me, all the bills add up and a lot of people get scared the first time they do a budget and subsequently decide to just “wing it” and these people never seem to be able to get ahead and they never know where their money goes. When you know you have to account for every dollar you can make better decisions and decide against buying things that are beyond your means. Hope that helps. Good luck!