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Sanitizer for a Clean House

While cleanliness should always be a top requirement in our home, keeping your house clean and disinfected during these times is more important than ever. Just like your hands need to be washed through with sanitizer or soap and water (or both!), your home should stay a clean house day in and day out. We have gathered some tips on how to keep a clean house now and moving forward.

The sanitizer you use on your hands will of course not do the trick for your home. So when thinking about the best disinfectant for home, bleach will always come up at the top. If you are searching for something which is less potent but still effective, we have some options which may be beneficial for you.

First on the list is of course vinegar. This versatile liquid has been used historically as a good homemade natural cleanser to forego any chemicals in commercial cleaners. To make this homemade wood floor cleaner, just mix one cup of vegetable oil with one cup of vinegar. To prep your floors before applying your brand-new homemade floor cleaner, you will need to sweep or vacuum your floors to ensure there are no dust particles or dirt laying around before you spray on your solution. Once the floors are clean, just mix the oil and vinegar in a spray bottle and wipe the floors with a microfiber cloth. These two ingredients work hand in hand as the vinegar cleans, the oil will add shine to the wood. Once you are done applying the homemade wood floor cleaner, you will need another clean cloth (or mop) to clean off the residue. It’s recommended to clean off the residue in a circular motion, and voila! Clean floors using a homemade floor cleaner.

Another option instead of bleach is iodophor, though this solution is more expensive. Even at a higher price, the iodophor is a great option as this sanitizer needs to be diluted down before use. Out of one 4 ounce bottle of iodophor, you can get 40 gallons of the watered down solution as you only need 1 tablespoon per 5 gallons of water. The great benefit of iodophor is that aside from getting more bang for your buck once it’s diluted, and the fact that it is a safer solution when compared to bleach, iodophor doesn’t leave a strong odor behind. When you are in the midst of your “deep cleaning house” mode, you do not want to inhale too much bleach as the chlorine smell is very strong. With iodophor, you are using a sanitizer that doesn’t leave a strong odor behind and lingering all over your home. Lastly, iodophor is a iodine-based sterilizer which means it isn’t chemically reactive to metals like chlorine is. This means this is a sanitizer you can use on stainless steel, pots, and other household materials at the right concentration and not cause harm to your belongings.

Keeping a clean house should not have to be a decision between inhaling potent chemicals just to do a good deep cleaning house and a homemade floor cleaner.  We believe you can have both using these options. Let us know if you have tried these solutions before, how did you like them? Share your thoughts below!

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Property Tax 101

When purchasing a new property, whether it be your primary home, vacation home, or an investment, there are monthly costs to consider every time. The first thing that comes to mind is the home mortgage, which is more than likely going to be the biggest recurring expense on your property.  However, even if you are buying a property in cash, there are still some monthly expenses you need to consider. There is of course an HOA fee if your home is part of an association, property insurance which is crucial, and debatably one of the most necessary but cringe worthy expenses: property tax. 

While we know that these taxes are used to fund our everyday lives such as the paved roads in the town we live, in the sewage system, the school system, etc, some states and cities can have very high property tax rate or mill rates (will explain this in more detail below) which can really increase your monthly expenses. One thing is for certain, you can always count on receiving a tax bill for as long as you own that home.

To understand how property tax is calculated, tools on where to find property taxes by address, and just a general understanding of taxes, read ahead!

Property Tax Overview

A property tax rate or millage rate (often called mill rate) is a proportion calculated based on the estimated value of the property, usually levied on real estate. This tax is based on where the property is located which is dictated by the national government, a local state, a county or geographical region or a municipality. Two different towns within the same county may have different mill rates, just as two different neighborhoods within a city may have property tax rates that are different.

In other words, property tax in the U.S. is collected by local governments and are typically based on the value of a property. This means that as time passes the tax bill will likely increase as your home will be reassessed and (if all goes well) the value of the home will appreciate in value.

What is tax money used for? In a general sense, these funds support community safety through policing, education through public schools and private charter schools in some areas, infrastructure such as sidewalks and highways and other public projects.  There are tools available which can help you to better understand the average cost of property tax rate in your area.

What Are Property Taxes?

The short version is that property taxes are taxes levied on real estate by governments, usually at the state, county and local level. Fun fact: property taxes are one of the oldest forms of taxation. To put a date to it, the earliest known record of property tax dates to the 6th century B.C. This means that in the U.S., property taxes are older than income taxes!  You may be familiar with some states which don’t levy an income tax, however, all states (even Washington, D.C.) have property taxes.

How Are Property Taxes Calculated?

The is a property tax formula, but before we get into that, one important thing to remember is that your property tax payment is not regulated by the federal government. The property taxes are based on the state and county tax levies for where the property is located.  Lets say you live in Connecticut but own a property in the Bronx, your New York’s property tax bill will be based on the Bronx levy and the value of your Bronx property. 

How much you pay in property tax greatly varies; in some areas of the country, your annual property tax bill may be less than one month’s mortgage payment. In other places, it can be as high as two to three times as much as your monthly mortgage payment.  Since this variability is the hard truth about taxes and something you cannot really control, you’ll want to take this facet of your home search process into account when deciding on where you want to live or what areas you are interested in investing in. A good amount of times, areas with high property taxes also have more to offer such as good public schools and programs, but you’ll just need factor this into your budget.

What Are Property Taxes Used For?

It’s important to understand that no matter how you feel about property tax costs, property taxes are necessary for state and local governments to function. These funds account for most of the revenue needed to support infrastructure, continue public safety and public schools, as well as for the county government itself to function.

In general, the best public schools are typically located in municipalities which would be considered to be on the affluent end of the spectrum.  These areas have high home values and high property taxes. There are some states which provide state funds for county projects, but other states step away and leave the decision making to the counties who then levy and use these collected property taxes fully at their discretion. For this group, funding all county services through property taxes is the only option.

As an example, a breakdown for a town in Connecticut can be as follows:

§ The county takes a cut as do

§ The local school districts and colleges

§ The library

§ The fire department

Though this is a specific example, where you live it may be difficult to find the same breakdown of the tax levies. Your bill can oftentimes depend on the budgets for your county, the school district votes, as well as other variable factors that are particularly applicable to where your property is located. 

How Do Property Taxes Work?

This will be a crash course on the main aspects of how property tax works, so lets start off by highlighting some key terms first.

§ "assessment ratio" and

§ “millage rate”

The assessment ratio is the ratio of the home value; this value is determined by an official appraisal which is typically completed by a county assessor as well as the value as determined by the housing market. For example, if the assessed value of your home is $200,000, but the market value is $250,000, then the assessment ratio is 80% (200,000/250,000). You then take the market value of the property and multiply it by the assessment ratio in your area.  This would equal the assessed value of your property for tax purposes.

You may be wondering how and when the county assessor appraises your property. This depends on the specific county your property is located in, but the most common is for this to happen annually, every five years, or something in between. There are some states where the assessed value is the same as the current market rate of your property. The assessor in these situations would do a “market comparison report” which essentially takes the recent sales in your area for a similar property and compares it to your property. Other states may establish that your property’s assessed value is thousands of dollars less than the market value. By going onto your city’s website and looking up the tax assessor section, you should be able to get an explanation to how property taxes work within that area. Some towns and cities even have the ability to find property taxes by address so you should be able to pay property tax online login in those cities. You should also be able to visit the local city hall to get more information in person from the government if you would prefer this method over searching online. 

Now lets look at the millage rates. The millage rate is the amount per $1,000 of property value that's levied in taxes. The millage rates are expressed in tenths of a penny, meaning one mill is $0.001. So on that same $200,000 home from the example above, a millage rate of $0.002 will equal $400 in taxes owed ($0.002 x $200,000 assessed value = $400). Keep in mind that each school district can have its own millage rate. All of these separate tax levies are added and then applied to your taxable value.

To put it all together, to get the property tax formula for your area, you need to take your property’s assessed value and subtract any applicable exemptions for which you're eligible for and from there you get the taxable value of your property. That taxable value then gets multiplied by the sum of all applicable millage rates. The number you end up with (millage multiplied by taxable value) tells you the property taxes owed before any credits. Remember that tax credits are different from exemptions and aren’t available everywhere. You have to check with your county to see if there are any credits you are eligible for. These credits are then subtracted from the total taxes you owe. Once you calculate that number, you have your total property tax bill.

…And What Exactly Are Property Tax Exemptions?

You saw we subtly mentioned tax exemptions in the previous section, but this may be the first time you have heard of them. To shed a bit more light on that, here's a breakdown of some of the most common property tax exemptions:

§ Homestead

> This exemption safeguards the surviving spouse and protects the value of a home from property taxes and creditors in the event a homeowner dies.  For example, if the state you live in offers a homestead exemption for a homeowner’s primary residence that offers a 50% reduction of the home's taxable value, then that means that if your home was assessed at $150,000, and you qualified for an exemption of 50%, your taxable home value would become $75,000. The millage rates would apply to that reduced number, rather than the full assessed value.

§ Persons with disabilities

§ Senior Citizens

§ Veterans/Disabled Veterans

§ Religious or Non-Profit Groups

> A lot of states and counties include certain property tax exemptions beyond the full exemptions granted to religious or nonprofit groups. These specialized exemptions are usually a reduction of up to 50% of taxable value but the rates can vary.

How you get the exemption can vary as some states offer exemptions automatically without any further action being needed by the homeowner if your property if it is a primary residence. Other states and counties require applications and proof for specific exemptions. You should spend some time researching whether you qualify for any of these exemptions and bake these into your property tax formula as this can save thousands of dollars over the years in property tax rate.

How Do You Pay Your Taxes?

Different cities have their own systems, and oftentimes there is more than one way to pay your taxes. That said, if you have a condo, single, or multifamily property (up to 4 units) and you purchased the home using a mortgage lender, the tax payments are part of your monthly mortgage payment. Take a look at your latest mortgage statement: there should be several charges broken down there:

§ Principal

§ Interest

§ Taxes

§ Insurance

This quad of expenses is typically referred to as “PITI” and is frequently set up automatically once you sign your mortgage papers at closing. By paying this amount every month to your mortgage lender, they are able to keep that money in escrow and then pay the government on behalf of the homeowner. If you do not have a mortgage, chose to opt-out, or have a property which is considered commercial (i.e. 6 unit multi-family) then you have to keep track of when your taxes are due (can be on a monthly, quarterly, semi-annual or annual basis) and pay property tax bill directly to the county government. As mentioned before, many cities and towns have the ability to pay property tax online login via the tax assessors site where you can find property taxes by address and pay directly online.

To Wrap It All Up

You are the one who decides what kind of tax burden you are ok with and what you aren’t. If you feel that paying more in taxes will enable your kids to have a better public education then it may be worth it. Similarly, if you feel that saving money on your annual tax bill due to living in a district that does not do much for public programs is something you are ok with then that is something up to you and your family’s discretion. In the end, deciding to purchase a home and taking property taxes into account is indeed something you should not bypass.

Just remember that the amount of variance across counties and school districts can be considerable. This is the one recurring expense you can always count on, even when mortgage payments go away. Once you are a senior you may qualify to get a property tax break, but you should make sure that the area you are purchasing your home in has this exemption. Even if you get it granted, there will still be a tax bill though it won’t be as high so it should always be taken into your budgeting calculations. 

Always remember to do your own thorough research by going straight to your local government’s website or visit in person with any and every question you may have.

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Homeowners Payment Relief Program

In light of the recent economic situation with the COVID-19 pandemic, a lot of homeowners are wondering where to turn in times of hardship. Homeowner relief programs are available depending on your bank; we recommend you check in with your mortgage lender to see what options they are offering.  This guide is meant to serve you as a starting point before connecting with your provider.

Homeowners payment relief programs are made for individuals who experienced a reduction in their income or who have been faced with full on unemployment.  These programs for homeowners are part of the Corona-virus Aid, Relief, and Economic Security Act, also known as the CARES Act, where the federal government has partly directed mortgage lenders to provide relief to affected homeowners. While local governments are individually deciding the best way to help renters who were affected, being a homeowner has enabled homeowners to be doubly protected since in addition to federal government homeowners payment relief programs, some local state officials are rolling out programs as well. 

Let’s look at the federal options and where to start:

The first step is to verify your mortgage type.  Knowing this will determine which type of assistance is available to you.  The types of loans eligible for payment relief under the CARES Act are:

§  Conventional loans: GSEs, Fannie Mae, or Freddie Mac

§  FHA loans: Federal Housing Administration

§  VA loans: Department of Veterans Affairs

§  USDA loans: Department of Agriculture

Conventional loans owned by Freddie Mac or Fannie Mae have a search feature on their site which you can use to find out whether your loan is owned by them.  For FHA, VA, or USDA loans you can look on your closing documents; find your Closing Disclosure and on the upper right of the first page there are check-boxes which will indicate what kind of loan you have.  Your mortgage lender will be able to give you this information as well.  Here is a breakdown of the programs available for each loan type:

§  Freddie Mac: borrowers can set their loans for up to 12 months of forbearance, which will not be reported to credit bureaus

§  Fannie Mae: borrowers can set their loans for up to 12 months of reduced or suspended payments, which will not be reported to credit bureaus

§  FHA: not only is are these loans offering forbearance under the CARES Act, but there are always different mortgage relief programs in place such as standard mortgage forbearance lasting up to six months and special forbearance for unemployment (which can last a year or more)

§  VA: in addition to the CARES Act, VA lenders were encouraged to use their other preexisting homeowner payment relief programs including special forbearance which varies in duration based on the borrower’s situation

Though there will be no late payment fees, penalties, or interest during the 180 day CARES Act forbearance requirement with the option to request another 180 days, it is important to note that forbearance does not mean forgiveness.  What this means is that the payments will still be due at the end of the forbearance period for the homeowner payment relief program.  That being said, we recommend you get a full and thorough understanding of what the payback terms are when speaking to your lender.  Your regular interest will still accrue and therefore, once the forbearance period is over the payments you have missed will be due.  If you do not feel comfortable with the terms, it is best to ask your mortgage lender as many questions before making a decision on any loan modifications. We recommend calling before you miss a payment as this will likely give you more options for the homeowner relief program. Before you contact your provider, make sure you have:

§  Estimated your current and future income to see what you can afford

§  A good estimate of your monthly expenses

§  Your most recent mortgage statement

§  Supporting documents of what caused your financial situation to change     

Being a homeowner in times like this highlights the importance of owning a home as homeowner payment relief programs are federal and therefore provide a further security net.  We wish everyone the best of luck and strength during this time.  If you have any tips on how you’re navigating through tough times, share your experience with the CARES Act mortgage relief program below!

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Homeowners Association

Some hate them, some love them; we’re here to talk about the facts about them so that you can form your own opinions on homeowners associations. Homeowner associations (HOA for short) are formed with the purpose of keeping residential communities clean and running smoothly. Though most people think HOAs are just for co-ops or condominiums, some townhouse and single family homes can be part of a planned development and therefore have the HOA structure as well. Homeowner associations relieve the owners in these communities from some responsibilities which would fall on the homeowner were they not a part of a HOA, but owners do still have responsibilities and rules to adhere to.

To start this quick overview section, it is important to understand who forms part of the homeowners association and how they get there. Most of the time, HOA boards are comprised of residents of the same community they serve; these individuals get voted in by the other homeowners that are part of the HOA. Each individual has a different role within the group such as treasurer, secretary, and president. Collectively, their primary responsibility is to maintain cleanliness, stay up to date with the master insurance, ensure utilities for the shared areas are paid, and overall manage the finances for the community. Though these individuals do not get a salary, they establish a monthly fee every homeowner must pay in order to cover the community’s expenses. Each HOA will have bylaws which define the responsibilities that fall under the association and which ones are the owner’s responsibility.

Please note that when buying property in a building, community, or development with HOA you automatically join the homeowners association once you purchase the property, this is not an optional. By purchasing the property and consequently joining the HOA, you also agree to pay the dues, including any special assessments, and adhere to the rules (for example, if the bylaws say everyone has to have red window entrance rugs, then your entrance rugs must remain red). 

According to data from 2017, one in every five homeowners will be living in a home that is part of an HOA. With the increase in this sort of developments, the numbers can now be higher. Deciding whether to purchase a home that would come with an HOA, homeowners should figure out what their personal needs are. Often owning a home is appealing due to the independence that comes from it which can be limited by an HOA, but on the flipside, home maintenance can be a huge responsibility which the HOA helps out with. Nevertheless, some important points to understand for homeowner associations properties are laid out below.

Pricing is not a one size fits all

Within the last 5 years the national averages for HOA dues came in at about $331. However, in places like New York City the average was $571 which can be way higher depending on the amenities that are offered as well as the number of units in the building.

HOA dues don’t just vary by state and city, they will also vary by area within the same city and even by year within the same development. The size of each community also determines the cost of the HOA as large developments will likely be gated with security staff to pay, these homeowners would pay more than owners in a small development with no gate and no full-time staff.  Even within the same development one three bedroom home will likely pay more than the two bedroom homes – other factors such as the square footage of each home, the location, and proximity to common areas can change the HOA dues as well.

When buyers are searching for their next purchase, making note of HOA dues trends should be a top item to mark off of the to do list. Prospective buyers should look at the homeowner association fees for the past 10 years, and request for projections for the next 5 years. Though fees are typically only adjusted once a year, if needed, seeing these trends will enable buyers to understand the past and future costs of utilities, staff, maintenance, renovations, and more. The homeowners association bylaws will also state how much the fees are permitted to increase year over year. There have been instances where developments have reduced the HOA dues to show prospective buyers a more attractive offer; overtime these fees are increased as maintaining them at the low price is not sustainable for the development to cover the necessary costs. The opposite can also happen where the fees are reduced over time as more homes are added to the development and therefore can share the costs.

There are also differences in what is covered

The bylaws for structures that fall under an “HOA property management” determine all of the legal obligations you are agreeing to as part of the homeowner association. It is best to get as familiar with the bylaws as possible to prevent any issues in your home-ownership tenure. 

There will be some communities where your financial situation may be impacted in a different way than what you were projecting for. For example, some HOAs have utilities included or even taxes, where others do not. Some HOAs cover the cost of garbage pick up where others do not. Having a clear understanding of exactly what gets covered is essential to deciding whether that is a property you want to purchase. Along those lines, you will also have amenities that you otherwise wouldn’t have the space or resources to invest in privately.  For example, a homeowners association development can offer a golf course for the residents only.  There are also many developments with community space you can use for large get-together and even pools for the residents and their guests.  Again, the use of these spaces will be determined by the bylaws (i.e. community space rental fees, if applicable, and guest hours or guest limits for the pools) so reading through these and understanding what is within your rights as a HOA member is crucial.

Master insurance is also covered in some or all areas of the development while the owners are individually responsible for the others. Many times, these requirements are mandated by state law – for example, a condo in a high-rise building will have a master insurance policy which covers the common areas up until an individual unit’s unfinished wall. Everything inside the walls including appliances, flooring, and cabinetry are part of the individual homeowner’s insurance policy. You can check your state laws and cross reference with the homeowners association to ensure they are following local requirements.

Compare the fees (current, past, and future, if possible) as well as what is included as part of the community against the other residences with HOAs in the area to understand the pros and cons of the HOA in each potential buy.

And more about the dues

Now that you understand that HOA dues can vary greatly depending on the development, the home within the same development, or the year within the same home, there can also be additional fees that are added on to the monthly HOA dues to cover capital improvements.  While some homeowners association boards decide to charge higher fees from the start and have a large amount of reserves ready for when significant improvements/renovations need to be done or legal expenses arise, others prefer to keep the fees low and roll out special assessments as needed.  In other words, when there is a large expense coming up (for example an elevator replacement) some buildings will have the reserves to cover it therefore the homeowners will have no changes in their monthly expenses.  For the HOAs that prefer the latter route, the monthly costs will increase, likely for a certain amount of time, to make up for the expense that is not covered by the reserves in the HOA account. 

The reserve account balance required will be established by the HOA board and will be dependent on the age of the community, the condition, and the amenities offered. The projected fee plans that are established will layout the upcoming planned expenses and back out into what is required to be paid for by each owner.  You can request those documents and see how the financial planning and reserve funds look like for the community as well as ask for information on any planned special assessments in the future.

Experienced buyers may be familiar with the mortgage process, but for first time home-buyers, remember that the HOA dues will be looked at by the mortgage lender to establish your financial position. Keep these factors in mind when looking at properties to purchase as higher HOA dues would leave you with a smaller loan amount from the bank. That being said, the fees associated with the property do not reduce the property’s value. Your lender will be able to provide you with the figures you can work with depending on your loan qualifications.

Really want to emphasize the rules

The bylaws and the covenants, conditions, and restrictions (CC&R) are the governing power in the homeowners association, so you really want to drill in the importance of understanding these. What applies to one development won’t apply to the other.  You need to figure out if you can personally live with these rules for your specific community. 

CC&Rs cover the “what” and bylaws cover the “how”. You can try to search online for the association’s CC&Rs at the HOA property management website or ask your realtor to request them from the homeowners association directly. Before reading through these or getting too far down the home purchase process, make sure they are up to date. There are some CC&Rs which can really limit the way you enjoy your home; while a good amount cover the rules and regulations you would expect including how the exterior of the homes may look and must be maintained, others will go as far as establishing how many trees you are allowed to have, how many cars can be parked in your driveway, how high fences can go, and even what you can put on the windows that face the street. So if you are interested in having a garden in your backyard, you may want to check the CC&Rs to see what kind of vegetation is allowed to be grown inside the development as well as which fertilizers, pesticides, or sprinkler systems are permitted.

Another important aspect of the CC&Rs is the ability to rent out your property. Even if you are buying the home as your primary residence, down the line you may want to buy another place and rent your HOA home out. Short term rentals and vacation home rentals can also be limited for your development. Make sure to get familiar with what those provisions are.

Homeowners association conduct

As you would expect, there are issues that will arise within communities; this is to be expected. However, how the conflicts are resolved says a lot about the community you will be joining. Being well informed of how the homeowners association handles conflict resolution as well as what their reputation is, is a great guiding force in understanding the development.

When homeowners violate the rules, others will likely voice their opinion. There may also be disagreement between the HOA property management board and the other residents which is not part of the board, or there can be issues within the HOA board members themselves. Homeowners are likely fined when a rule is broken, but in extreme cases the homeowner can be sued, and a lien can be placed on the home. Nonpayment of HOA dues can of course cause a foreclosure, but what some buyers don’t realize is that a large amount of unpaid fines due to rule violations can call for a foreclosure as well. Ask what the conflict resolution process is, for the cases of past conflict and the outcome, as well as specifically requesting any pending lawsuits and results from past cases. Lastly, getting information on how the HOA goes about adding, removing, or changing the rules would be beneficial.

There will also be situations where there are issues within the HOA itself, as these individuals are volunteers more or less serving as the government for the community; knowing who they are and how well they work together will be a good indicator of the residence.  However, there are also HOAs that are run by private HOA management companies who do not live in the building.  Research the HOA management company reputation, the employees, and the companies which it contracts out tasks to before you buy.  In either case, it would be helpful to connect with some of the buildings current owners, if possible (and not any members of the actual board) to get a better sense of how the board functions, how are differences in opinions handled, is there frequent drama, and questions of the like. You can also schedule time to speak with the HOA president directly to gauge what their motivation in being the board is – are they motivated by their responsibilities or are they indifferent?

Final remarks

Take time to really see what you are buying into. If the seller for the home you are interested in is showing obvious signs of non-compliance with the homeowners association such as different paint color than the surrounding properties, overgrown landscaping, etc, then you may be signing up to inherit a preexisting CC&R violation which may not be properly highlighted to you.  If you learn of any current violations you can work with the seller to fix these before you acquire the property as part of the contract or get a cash refund at closing.

All that said, having a home as part of an HOA has huge upsides. Oftentimes there is a higher level of security, cleanliness and maintenance which is required of your neighbors and therefore provides a pleasant experience for your family, as well as an increase in private amenities you wouldn’t otherwise be able to enjoy. Weighing out whether the restrictions set forth by the HOA are within your field of tolerance is the number one way you can decide if being part of these developments is the right next step for you. If you part of or looking to buy a property that is part of an HOA? Share your experience below!

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16 Common Scenarios: When To DIY and When to Hire a Pro

Owning a home is generally liberating, you can make the space that you want, contribute towards your personal equity and not be at the mercy of your rent possibly increasing by 100%. However, it does come with more responsibility as you can no longer call on your landlord for maintenance and repairs. The toilet you never had to use if it wasn’t to dispose of your own bodily fluids? Now you have to upkeep. The beautiful yard which looked so luscious and green when you purchased the property? Yep, your lawnmower has to take care of that now. 

You may be tempted to call a professional contractor, plumber, electrician, or landscaper but these things can add up and eat away at your budget. At the same time, in today’s day and age, finding online video tutorials which explain how to do (almost) anything is so easily attainable that it becomes increasingly tempting to just pick up some tools of the trade and do it all yourself, even if you don’t have the skills needed to fix your own home. It’s important to note that a DIY home project without the right planning and knowledge can actually end up being more expensive in the long run as calling a pro down the line would require they fix the original problem plus the new problem that was caused by the homeowner taking on a project he or she was not ready for. Even if you are comfortable with some projects, the knowledge base needed for another project may not be the same. You also have to consider the amount of time, materials, tools, and in some cases, permits that are needed to tackle your home improvement projects.

So what should you DIY and what should you leave to the experts? While we’re all about saving some bucks, there are some times when pros are needed and other times when you should save some cash and do the handiwork yourself. So, whether you are a homeowner who wants to save some money or a renting tenant who just wants to take care of some things without having to wait for your landlord, here are 16 common situations and when you can DIY versus when a pro should be called. Spoiler alert: it’s an even score!

 1.     Removing Popcorn Ceilings - Hire a pro

For starters, removing popcorn ceilings is extremely messy. Though it is gaining in popularity lately as popcorn ceilings seem to be tied to an old world style, taking on this project requires a lot of steps. To start, the popcorn must be sprayed and softened by a softening agent. The next step would be for all of the surface area must be scraped with a blade. This part can be particularly difficult as scraping unquestionably creates divots and holes on the surface. Those divots and holes need repair with compound that will need to dry and then be sanded smooth before painting. For the last step, everything needs to be primed and then painted with two coats of paint. Since it is all done on the ceiling, the work is overhead and requires the person doing the job to be standing on ladders for long periods of time.

 2.     Fixing a Leaky Kitchen or Bathroom Pipe - DIY it

Sounds scary, but this can have a simple solution. Sometimes parts of the draining system become lose so it may just be a quick fix. All you would have to do is tighten a slip-nut near the P-Trap. If the leak is coming directly from a hole in the drain pipe, the fix would require a flexible coupling with hose clamps. However, if the leak is inside the wall, then you may want to consider calling a pro.

 3.     Hanging Wallpaper - Hire a pro

While this seems easier than fixing a leaky kitchen or bathroom pipe, the challenge is getting the wallpaper straight on the wall and matching up the patterns correctly so that it looks smooth. This typically requires two people to do the job. Also, sometimes the wallpaper you hang up can cause bubbling; when this happens you have to remove the wallpaper and install a new strip of wallpaper. This can (1) be very labor intensive and (2) end up using up more wallpaper than needed which would then run up your expense as you would need to order more. Since this isn’t a safe vs. not safe scenario, it’s up to your discretion to decide whether going down the DIY route and the potential savings outweigh the potential risks. Getting a pro to do this job basically guarantees a smooth and predictable result.  

 4.     Painting the Exterior of Your Home - Hire a pro

Talking about labor intensive jobs, painting the exterior of a house is a huge job. The majorities of homes require all of the trim, soffits, and rake boards to be painted. Depending on the type of home, all of the siding would of course need to be painted as well. Not only will this take hours to be done correctly, but it also required extensive use of ladders at high levels and sometimes climbing up on the roof. As a homeowner, you need to consider safety requirements before taking on an exterior job.

 5.     Fixing a Clogged Garbage Disposal - DIY it

As a first method to repair the problem, you may be able to DIY yourself out of this one. You may be able to clear a clogged disposal by using a small specialty wrench that fits into a hexagonal opening on the underside of the disposal. Make sure that the disposal is turned off before starting the work. If this doesn’t work it would be wise to call on a pro to take a further look at it.

 6.     Replacing a Faucet – DIY it

This one comes with a huge caveat. We only recommend to DIY it if it’s a centerset type faucet as all you would need to do here would be to follow the faucet manufacturer's installation instructions. A more complicated, wide-spread type of faucet with various hose connections on the underside, however, would be best handled by a professional.

 7.     Fix a Running Toilet - DIY it

You can get a toilet rebuild kit from big box or hardware stores and fix a running toilet easily by following the straightforward and easy-to-follow instructions that come within the kit. If you have a one-piece or specialty toilet, these can become tricky and would therefore need the professional touch.

 8.     Installing a Light Fixture - Hire a pro

Though electrical repairs and installations are mostly always expensive, these tasks are best left to a professional electrician. If you’d like to give it a go and take some time to research and understand your electrical system, you may be able to get the necessary skills to complete simple electrical projects yourself. As a rule of thumb for installing a light fixture, low voltage projects can be safely done by a homeowner, but if your project is over 50 volts, it’s best to get an electrician in.

 9.     Installing a Ceiling Fan - Hire a pro

This one almost goes hand in hand with the above as installing a ceiling fan is not extremely difficult but would require some electric wire work.  This task may also be a bit labor intensive and take a few hours depending on your home maintenance experience and the fan itself. Save this project for a professional to ensure the fan is safely installed and isn’t left wobbly as this can be a safety hazard when the fan is on, especially at a high fan setting.

 10.            Adding Chimes to Your Doorbell - DIY it

A simple home improvement project would be to add chimes to your existing doorbell system.  If this is something you are interested in doing, you can do this easily as it is a low-voltage project that doesn’t require the know-how of the pros.

 11.            Patching a Hole in Drywall – DIY it

Perhaps one of the simplest fixes you can take on is patching a nail hole in your wall. This is an easy way to give your old drywall a fresh face.  Just take a spackle knife and fill in each hole with lightweight putty. Then scrape off any excess putty from the wall and let it dry.  Once dry, sand the spot down until it is smooth and paint the area which was repaired with primer. If you are looking to take care of a bigger hole, drywall cutting, replacing, or mudding then its best to get a pro in to take care of it.

 12.            Cleaning Gutters - DIY it

Only go the DIY route on this one if you are comfortable on a ladder. When gutters are clogged, it can cause water to sit still around the house, eventually leaking into the basement, and seeping under siding. Sooner or later this will cause major mold and rot issues. To be preventative in these scenarios, get into the habit of cleaning leaves out the gutters every spring and fall. Please note this is only recommended as a DIY task for single-story homes with level grounding around the foundation and an experienced ladder climber. It is also recommended to do this project when someone else is there to hold the ladder still and help. If your home is two stories or more, or if you aren’t comfortable climbing up a high ladder in order to clean out the debris, it’s best to hire a pro. 

 13.            Re-grouting Tile - DIY it

This may not be the DIY project you start off with, but once you are comfortable with other DIY home maintenance projects then this is a common household fix (or upgrade) which you can do. Since the surface of tile grout is porous, it is easy for dirt to get caught in the cracks of the grout which makes the grout look discolored. 

To complete this project you first need to choose the right one out of 4 choices: sanded, unsanded, acrylic latex, or epoxy. To figure out which one you will need, measure the space between your tiles.  As a general rule, if the space between the tiles is under 1/8-inch, use an unsanded, acrylic, or epoxy grout. If it is over 1/8-inch, use a sanded grout. Also, don’t forget to match the grout color! Once you purchase the right grout, clean the grouted area. Next use a grout saw in order to remove the damaged grout and then dampen the joints with a wet rag. Take a look at the directions on the grout you purchased and mix accordingly. It is important to fill all the joints completely and smooth over the surface with a damp sponge to remove excess grout. Allow the grout to set firmly and then clean with a damp rag.

 14.            Installing Molding - Hire a pro

The toughest thing about installing crown molding is the necessity for accurate measurement. Though you may have a power saw (or know where to rent one from), this is also a job that requires great stability while standing on a ladder. You must be able to not only the measurements accurately but also line up the cuts seamlessly. If you have done a good amount of other DIY projects, you may be able to take this on if you feel confident in your skills. Otherwise it would be best to get a pro on this job.

 15.            Replacing a Door - Hire a pro

If you are simply replacing one door with another door that is exactly the same, then you should be fine doing this yourself.  However, adding a new door as a major overhaul can be a big project. For example, if you are looking to add a new door to brighten up a space (like turning two windows into an opening for beautiful French or sliding glass doors) or to cut down on heating and cooling costs, then you want to be sure that the job is done right.

 16.            Fixing a Sticking Window - Hire a pro

This may seem like a fairly innocuous task, but it can become labor intensive and complicated quite quickly depending on the reason why the window it stuck in the first place. Sometimes it can be caused by a buildup of dirt and debris in the window casing. Other times it can be due to problems in the foundation of the home shifting and therefore causing windows to lose alignment and get stuck. Or it can be something as simple as forgetting to let the paint dry during the last DIY project and closing the window before it completely dries, thus causing the window to glue closed. If you live in a high humidity area, this can also cause doors and windows to swell and bind them in the jamb. Since there are so many causes for a sticking window, in order to fix a stuck window often involves removing the window which could require using a belt sander or planer. If you’re not super experienced at home repairs or home renovations and do not have the know-how to safely use the tools required, it’s best to let the pros handle this task.

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11 Ways to Save Money and Time on Your DIY Home Project

You don’t want to miss out on these tips before starting your project!

 Get the Best Product, At the Cheapest Price

Just because you are looking to save money does not mean you should buy materials that won’t last long. After all, you want to have your dream home be a place you enjoy, not a place you despise! If you are an investor renovating for your tenants, you still want those renters to feel happy in the place you are offering them. There are many ways you can save a lot of money on the best products such as buying a different color to the same product that would cost more in white or clear.

A great example of this is mortar for a tile project. If you have a small space that you are looking to renovate and not an entire house, you can also purchase left over materials from neighbors in your neighborhood as oftentimes, other homeowners, renters, or investors can have paint, tiles, and other material that they didn’t end up using for their home DIY project.

That said; don’t go overboard on the cost savings. If there is a material that costs more but you know is going to save you time or money down the line, then invest in that. A great example would be pre-mixed grout; the conveniences of having it pre-mixed and therefore mixed right, can justify the fact that it can be double or triple the cost. If you are not familiar with how to mix grout it can cause issues with the renovation which can end up costing you more in the long run.

Do Not Ignore the Clearance or Sales Products

If you are searching around for something specific, this one may be a little harder. However, often times you just have a specific goal in mind such as making the home or apartment space look more modern, changing up the aesthetics a bit, or maybe you have a specific color you would want to use but not a specific design. For all these cases, you should see the “great deal” offers that the store has. 

Whether it is flooring vinyl or tile, backsplashes, or any other material, you have the options in front of you to save up to 60% in a lot of cases when compared to the materials that aren’t on sale for that week. 

These sales are often for a specific amount of time or until the specific product/material runs out, so if you don’t have a set timeframe to do the project then it may be a good idea to stay up to date on what the sales are and take advantage when you see one you like. This brings us to the next point.

Ability to Be Flexible Is Key to Your Home DIY Project

These past few points have covered a larger philosophy when taking on a DIY project for your home or a rental unit, and that is being flexible on the colors, design, and sometimes material you would be using. If you have a specific design in mind, then the DIY project may cost you more than you were initially budgeting for. 

Likewise if you have a very specific teal color you want to use then you won’t be able to take advantage of the great sales the store could be having or the amazing materials someone could have left over from their own home renovation project. However, if your goal is to make your dream home beautiful instead of a splitting image of a Pinterest pin, then you will be able to do so within your budget.

Know Which Tools to Get

Whether you go down the road of renting tools or decide you want to buy your tools instead, you need to know which tools you want to use.  Something as simple as the right roller for a paint job can save you a ton of time and frustration as some rollers can soak up too much paint which causes a lot of paint to start dripping on the walls from the amount of excess paint being put on the walls at a time. Other rollers don’t soak up enough which causes you to continuously bend down and put more paint on the roller – this can be very exhausting if you are not used to the motions of painting for hours on end and maybe even for several days in a row. 

The right power tools can also make a difference as not all “power tools” have the same “power”, you can do the same motion over and over again without seeing progress, which can be doubly as frustrating as just seeing progress in small increments.

Along those lines, buying the right tools can be a savings in the long run. Let’s say you are changing the old vinyl floors that came with your home into nice floating floors. You’ve done the research, you’ve watched the YouTube videos, you found the floors you want to use – now it’s time to get to work. However, the first thing you notice is that those floors are really stuck on there! You must use a floor lifter which will run you about $40 bucks, not too bad. So, you get to work on the floor lifter with a little bit of torch work. Now that you are done, you realize you would prefer to smooth out the floors first so you’re going to need to sand the floors. A rental can run you between $50 - $300 depending on how long you will need it for, but if you purchase it it’ll run you a couple of hundred bucks and you can rent it out to other people once you’re done with it. This can be especially beneficial for owners who have more than one property as you would likely want to change the proverbial floors in all your units, one at a time. The upfront investment may be worth it in the long run.

It’s good to run through your options first to see what words for you before committing to one option or the other.

Always Have Enough

In the world of home renovations, especially on a do it yourself project, measuring how much material you need can be a tricky task.  Knowing that you won’t run out of material is paramount to your renovation success. You surely do not want to start putting down grey floors and finish off with brown!  The best way to go about this is to purchase extra and sell the material that you did not use. Not only will running out of material ruin the aesthetics of a project, but it will also delay the project if the store you bought the material from or the neighbor you purchased it from don’t have anymore!  This will cause you to add hours, or possibly days, to your project. There is always someone nearby who will also be working on their home, so you would be able to sell off the leftover material easily.

It’s also more cost efficient when you purchase the larger sizes from stores instead of a couple of smaller ones. Just as an example let’s look at a brand of generic paint; a single gallon of paint costs about $30 whereas the 5-gallon would cost $110 giving you a $40 savings. Even if you only use 4 of those gallons and have one left over, you are still saving on the material.  In addition, you can sell that leftover paint to someone who just needs to paint their front porch railings and doesn’t need that much paint. There are many ways to be efficient while still being cost effective.

Keep Spaces Tidy to Avoid Future Complications

There’s no secret here: keeping spaces tidy will benefit you at the end of the project. One way is to not cut anything indoors, not even in the garage. If you cut materials indoors you will have your entire space filled with dust by the end. From wood to sheetrock, it all lets off small dust particles that are guaranteed to get everywhere within the four walls it’s in. Then when you walk outside of that area you will bring that with you throughout the rest of the house or apartment as well. Cutting in your front or back yard will avoid these messes from happening in the first place making clean up way easier. You don’t want to add additional time to your DIY project (if you decide to clean it up yourself) nor do you want to add an additional expense (if you hire a housekeeper), so best to keep the messes to a minimum from the start.

Another tip to keep spaces tidy while you are working is to always want to keep a towel and a bucket near you. Preferably one bucket will just have water and the other will have water with soap (which is great for getting vinyl glue off of your hands, by the way!). When a mess happens, you do not want to have to jump out into the kitchen or bathroom to wet a rag and save your floor, walls, or cabinets from what can be a permanent stain. You want to keep cleaning tools nearby as you are guaranteed to need them at some point.

Another great way to keep your project running smoothly and ending just as smooth on the cleanliness front is to get a trash bin or dumpster from the city. This of course depends on where you live, but there are cities that rent out these dumpsters for a low price and dump it for you a certain number of times as well.  If you don’t go the dumpster route, remember that every city and town has its own laws as to how you can dispose of construction material. You do not want to be left with a huge pile of plywood, old kitchen cabinets, and other demo material because you didn’t plan for the disposing of the material beforehand.

Stay Organized After the Project Is Over, Too

Nothing more asinine but detrimental to your budget’s bottom line than buying a tool or material that you already have, simply because you don’t remember where it is or can’t find it. Once you get the hang of doing your own projects and see how much you can do by yourself simply by doing proper research and preparation beforehand, you will want to keep doing DIY projects. You may even offer your family and friends help with their home projects! Ok, maybe let’s not push it. But once you see the end result and become a DIY enthusiast for your home or rental property projects, you will see that some of the same tools get used over and over again. Make sure to keep the tools you buy organized in your garage, basement, or storage space so that when you need them again you can easily find them.  Creating labels and bins for each tool type wouldn’t be a bad idea and would really come in handy for many times in the length of your home project. If you prefer the renting route, make sure you know good places where you can find quality tools conveniently and for a good price.

There’s No Better Time for Future Home Projects than Today

Now that you have all your tools organized or know where to find them, and have the knowhow in regards to finding good step by step tutorials, put a list together of all the of the other things you want to do in your home. When you have down time, you can start to work on these small projects that can easily give a face lift to your home space or prepare for when a tenant moves out to renovate the space beautifully for the next tenant and quickly get it rented out.  This is perfect for when you are preparing for a new project but aren’t quite at the point where you can undertake the entire project just yet. Instead of sitting on the couch and watching another Netflix show, set up a list of the tools you will need to give the fireplace in your living room a makeover.

It’s also best to get into the habit of making a list of everything you will need with ample amount of time before starting your project. Being prepared really reduces the set-backs that can come about once you actually start. Everything from tools needed, to materials needed, to how much of each material your home project will require, to how long you are estimating the project will take can really help you in swift completion of your home or rental project.

Take Into Account Any Down Times

Drying times of course depend on what part of the project you are working on in any given time, but some things can take 1 - 2 hours (for example paint), while others can be overnight (like new tile). When planning your DIY project, make sure to take these timelines into consideration so as to not extend the time that it takes to finish the full renovation project. For example, if you start painting your bedroom early morning and are estimating it will take around 4 hours to finish that room, you planned well so that by the time lunch time comes around you are not only eating to keep going for the rest of the day, but giving that first coat of paint enough time to dry before moving on to the next coat. On the other hand, if you start painting at 4PM and estimate that it’ll take the same 4 hours, then by the time you are done its way past dinner time – now you’re hungry and you have to sleep on the couch since you don’t want to inhale paint all night long. 

There will be things that need to be done during the home renovation project as well which you should be accounting for. If you are not in a drying time but need to run errands, have the less skilled person do your bidding on this part of the project. For all parties involved, keep in mind that your phone should remain near you and charged so that any last minute change in the errand can be communicated effectively. This may seem rudimentary, but it happens quite often. Let’s say you’re working on your project for a few hours, listening to Spotify on your phone. Your partner asks you to go to the hardware store and you take off without realizing your battery is at 5%. Now there’s an emergency back at the house and your phone is dead; while you could have hurried back and/or brought back supplies that weren’t needed before but are crucial now, you will get back to find a big mess which could have been avoided (or at least reduced) by simply having your phone charged. If you are taking on your project on your own, just make sure you factor downtimes of getting anything that you may have forgotten during your project into your timelines as well.

Safety Is Always Number One

It doesn’t matter whether you are taking on your DIY home project by yourself, with your partner, or maybe helping the contractor to pick up some tools of the trade; the primary focus at all times is being safe. This includes everything from wearing protective gear such as ear protection, goggles, and masks when necessary to drinking enough water throughout the day to simply knowing what your limit is in aspects such as your physical strength. I know these things sound silly, but they can really come in handy as a reminder when you are in the middle of it all. 

Let’s say you are refinishing your tub with a new porcelain airbrush, it’s possible that you don’t think you need to wear the mask because you have good ventilation in your bathroom. It doesn’t matter! Wearing a mask will protect you from inhaling those chemicals which in the long-run can be harmful to some people. 

You should also take breaks and drink plenty of water which we forget to do in today’s day and age. We sit in front of our computers so long that when we do any sort of physical labor we have forgotten how dehydrated the manual work can make us. You don’t want to exchange a new wall color for yourself or a future tenant at the expense of having a headache for the rest of the day caused by dehydration or inhalation of a chemical which isn’t good for you.

Taking all of the 8 flooring boxes you bought in one go isn’t necessary. Though bringing one or two in at a time may take a bit more time, you’ll save yourself a back ache in the short term and possibly a hernia in the long term if you have the habit of doing this often enough. Don’t forsake a couple of minutes for what can become a lifetime consequence of overexerting yourself!

Don’t Lose Patience

All in all, renovating your home or a rental home for your future tenants is a cost effective way to make spaces look beautiful.  Be patient, learn what you can when you can, and don’t be afraid to ask for help. Other homeowners and investors have more than likely been through the same issues you have been through and can help you out. Completing these home renovation projects takes time to get comfortable with, but once you get the hang of it it’s super exciting to see the before and after results. Happy DIYing!

[mmyproperdeets]

Precautions You Need to Take on Renting Tools

If you are doing a DIY project at home, tool rentals can be a great way to save money. Why go out and buy items you might rarely use? However, handling various tools in general can be dangerous at times, especially if you are not familiar with certain types. Before you get hurt or break your borrowed instruments, consider some safety tips.

One of the first things to do is read any directions that come with the tools. It might sound obvious, but many people jump right into the project, assuming they know exactly how to use the items in front of them.

Whether the tool in question is something as simple as a drill or a bit more complicated, be sure to read any included instructions or warnings. If none come with it, you can probably ask the company from which you borrowed the instrument.

If your tool rentals typically include power tools, take extra precautions before using them. Safety goggles are usually a must, especially if you are cutting wood, fiberglass, metal, or any other material that might spew tiny, or large, particles into the air. Masks can be worn for the same reason. You should also tie up long hair if you have it, as this can help prevent it from getting caught. Additionally, try to wear clothes that cover you well, such as long sleeves and pants, but make sure they are not loose enough to get caught.

If your tool rentals usually involve power cords, remember to never unplug them by yanking on the cord. Instead, carefully take the plug out of the socket using dry hands. You should always unplug any product when it is not being used, both to avoid people from tripping over it and to prevent it from accidentally being turned on when you are not ready for it. Even if you are just working with hammers or screw drivers, be sure to put them away after each project session so you do not trip or step on them.

No matter what instruments you usually work with, you need to observe safety precautions. Following these tips for tool rentals can also help you avoid breaking any and having to pay to replace them. In fact, typically you should not borrow anything you do not know how to use right away. Though most complicated tools should come with directions, asking upfront how to use them from the company you are renting from can't hurt.

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Renting Gardening Tools

If you stand before a shabby, desolate and depressing front or backyard every morning, wondering if you can ever attain a home with "curb appeal," it might be time to consider a landscaping overhaul. Many people find landscaping a yard a daunting task, especially since you can't do much with a bucket and pail that is better suited to make sand castles than plant a tree. A major landscaping makeover will only need to be done once, and then regular maintenance is relatively simple; however, most people are afraid to make the investment in the equipment and materials for the initial project.

Fortunately, it isn't necessary to buy a chainsaw, jackhammer, or even a wheelbarrow. All of these devices can be rented for a fraction of the price. Device rental can be extremely helpful and absolves you from the expenses of owning and maintaining expensive equipment. Here are some basic tool rentals you might want to consider investing in for a standard garden project.

Pruning and Hedging Shears:

These are worth investing in if you have quite a few large shrubs or trees on your property, but if you're doing one massive overhaul device rental might be a better option for a one time use. They can help trim small branches and hedges to give a nice, clean appearance to the yard.

Chainsaw:

For those with larger jobs to tackle, a chainsaw is a great option for equipment rental. They are very expensive if purchased, and often are only needed a handful of times, making the price of buying not worth it. Chainsaws can cut through large branches and tree trunks that are either unsightly or pose a threat to the property, such as getting tangled in a power line.

Weed Eater:

Got a dead lawn? A weed eater can help you cut through an unkempt mess so you can re-sod or plant what you need to. These are a great time saver if the garden has been left derelict for some time.

Leaf Blower:

This is another piece of gardening equipment that is often more suitable as a tool rental. With a leaf blower you can blast away and pile large areas of leaves and other small lawn debris with ease, another necessity for working on long-abandoned gardens.

Hoe, Shovel, Bucket, and Rake:

These are the basic classics that every gardener needs, unless you plan on digging holes with your hands. You'll want to invest in high quality because you'll be using these devices for the majority of your gardening jobs.

Tool rental allows for greater flexibility, especially when you require using specialized gardening equipment. You can use the devices for as long as you need and return them without having to invest a fortune. Tool rentals are also a great idea for first time gardeners as it gives them a chance to see if they truly enjoy the hobby. Expert gardeners can benefit from short term tool rentals too, specifically when they are working on extremely challenging projects.

[mmyproperdeets]

Understanding home insurance

Homeowners insurance can be seen from many different perspectives, but regardless of whether you are required by your lender to have home insurance or not, this is a piece of the home-ownership puzzle you do not want to miss out on. Policies are largely customization and can be molded to fit what you are personally in need of to get the best homeowners insurance for you and your family to feel safe. As a landlord, aside from securing your investment with property insurance, you should also require your tenants to get their renters insurance as part of the lease between you and your tenant. This is imperative for your tenant to secure their personal belongings as your policy will not cover loss of damages for them.

If you are purchasing your property through a mortgage lender, they will most likely not lend without proof of home insurance coverage making this a requirement before approving your loan. Aside from that, this coverage provides your home and other personal property with much needed protection against liability in the event of an accident that can injure others or your property.

However, there are many aspects that aren’t covered by standard policies which you should add on to your home insurance policy should specific situations apply to you.  In addition, there are several types of coverage available, so getting familiar with each coverage and what exactly is included before purchasing your coverage is recommended. If you currently have your coverage you can also update your policy to reflect any revisions you feel you may need.

While insurance is highly customization, there are some tips for how to always be on your A-game when it comes to home insurance. We have included some quick but helpful tips at the end.

Understanding home insurance starts off with knowing that your policy is a legal contract which clearly states your rights and responsibilities as well as those for the insurance provider. It is in your best interest to research the company, take a look at the home insurance reviews, and be knowledgeable of their process for claims before choosing one home insurance company over another. Once you purchase the insurance you will receive the policy: take time to read through its contents, store it in a place where you can easily access it, and of course, know the name of your insurer.

Homeowners Insurance Coverage’s Explained

Before you get coverage or change from one home insurance company to another, you need to decide how much coverage you need. More than likely your lender will give you some specifics of what they are looking for at a minimum; any additional coverage is up to you to decide what would be the best homeowners insurance. Generally, your home insurance policy will cover damage to a property’s interior and exterior, the loss of theft of possessions, and personal liability for harm to others.

One significant differentiation between coverage’s will be the different types of coverage available. While the homeowner industry has standardized to range between HO-1 through HO-8, there are essentially 3 levels of coverage: the actual cash value vs. replacement cost vs. extended replacement cost/value. This is an option you will likely see when shopping around for insurance and is key to understanding home insurance. 

·         Actual cash value is the amount it would take to repair or replace damage to your home and your belongings after depreciation. In other words, this would be what your items are worth in the present, not how much you paid for them.

·         The replacement cost would be dollar amount it would cost to replace, rebuild the home, or repair damages using materials of similar kind and quality, without deducting for depreciation.  What this means is that if your home was completely destroyed, you would be able to replace the rebuild the home up to the original value. It is important to insure your home for at least 80 percent of its replacement value.

·         In a guaranteed (or extended) replacement cost/value policy, the inflation is basically buffered, and you are covered for whatever it costs to repair or rebuild your home – even if that amount exceeds your home insurance policy limit. Insurers may offer an extended replacement (offering more coverage than you purchased) but this is typically capped between 20% to 25% higher than the limit.

Liability coverage protects you, your family, and even your pets from lawsuits filed by others for personal liability on damage or injuries. We’ve heard of cases where dogs bite neighbors; a situation like this would be eligible to get a claim filed for your neighbor’s medical expenses – regardless whether it happened on your premises or on theirs. If your child accidentally shatters your neighbor’s entrance chandelier, you can file a claim to reimburse the neighbor as well.  If the neighbor steps on the glass and sues for pain and suffering or lost wages as well, then you can be covered for that as well.

Of course, the better your coverage the less you will be paying out of pocket when disaster strikes – as well as the higher your premium will be which would translate to higher payments on your monthly escrow. The deductible is the amount that you pay out of pocket when the time comes to use your insurance. When shopping for a home insurance policy make sure to compare what is covered and how much you would need to pay in deductibles. If your deductible is $1,500 and total damages are $2,500 that means you would have to pay $1,500 before the insurance dishes out their $1,000 portion. Higher deductibles will likely cost less in your monthly premium, but you have to be comfortable paying the deductible when you make a claim. 

The different coverage types and what is covered will of course make the pricing of the home insurance policy fluctuate, but the biggest determining factor in the premium for your property will be based on the likelihood that the insured (read: you, the homeowner) will file a claim. This is based on several factors including:

·         Past history on the home: any past claims on the home and the severity of it. If they insure a home that has had a number of claims over the last three years (even if it was from a previous owner) the home will be seen as a higher risk.  In some cases, if there are an excessive number of claims, some insurance companies may even be ineligible to coverage. 

·         The neighborhood: data on crime rate in the neighborhood will also affect your premium as vandalism would of course increase the likeliness of a claim being filed and therefore be a riskier property to cover. Along those lines, being close to a fire substation or having a fire hydrant within 100 feet of the home will likely lower the premium

·         The home’s condition: if a home is not well maintained, then the insurance company will see this as an increased chance of getting a claim filed. 

Other aspects will create differences in pricing including the insured’s credit, whether there are animals in the home and what kind, as well as oil tanks on premises. You must understand that while covering loss is the insurance company’s objective, they also need to make a profit. 

What Does Homeowners Insurance Not Cover

As a general rule, homeowner’s insurance covers most scenarios where loss can occur including during a fire, in the event of a hurricane, lightning damage, vandalism, and other disasters, but coverage is limited when it comes to other natural disasters (such as floods and earthquakes), poor home maintenance, and acts of war – these will require additional riders and therefore increase the cost of coverage. For example, if your home is located in a flood zone, your lender will typically do a FEMA flood search and see the risk; a requirement for flood insurance will be part of the loan package requisites. Along those lines, if a home is in an area prone to earthquakes, this home will also have an additional earthquake insurance coverage requirement. 

In addition, while your home insurance can provide you with off-premises coverage (for example, if you lost a pair of diamond earrings in another state, you would be able to file a claim for this) insurers will put a limit on the reimbursement amount, which typically ranges between 50% to 70% of the amount of insurance you have on the structure of your home. What this means is that if you have your house insured for $100,000, your personal possessions would be limited to $70,000 in coverage. So if you have a lot of expensive possessions such as art collectibles, fine jewelry, antiques, or designer clothes, the best homeowners insurance for you may include adding a rider to your home insurance policy to cover these items separately.

Another additional coverage which you can investigate is the additional living expenses coverage. While unlikely, there is a chance that something may happen to your hone where you would need to stay in a hotel or rent a house while your home is being rebuilt and replaced. If that does occur, attaining the additional living expenses coverage would be the best decision you could’ve made. This would cover rent, hotel room, meals at restaurants, and other incidental costs associated with not being able to inhabit your home for some time. While there are strict total and daily limits which depends on the coverage you select, this also can be adjusted and increased if you’re willing to pay more in the premium.

One key coverage that is not usual in standard homeowner’s insurance policies is sewer protection. While your home insurance may say it covers a sewer line break or collapse, the amount of coverage you would actually get is very limited as damage from overflows or backups from your sump pump, sewer system or drains won’t be covered. To get the most protection, there are companies that offer a backup rider which is a separate insurance policy to protect you in case of issues with the sewage line that have the potential of becoming very expensive. Something like a tree’s root blocking your sewage pipes, or sewage damage from a flood, earthquake, or hurricane would not be covered under the standard homeowners insurance.

Additional structures in your property aside from the main house including garages, sheds, or others, will likely be requiring a separate coverage as well.  So if you have a shed that may be close to the backyard fire pit or in any way may see damage which you want to cover, make sure you get an additional rider in your policy to have this structure covered.

Lastly, identity theft will not be a covered loss when it comes to home insurance. You would need to get this as a separate coverage as damage caused by anyone who may steal your personal information would have zero coverage from your home insurance provider. General damage resulting from failure to upkeep the property will not get covered either – including rust, rot, mold, and general wear and tear.

Understanding home insurance coverage’s and what they do not cover is getting the insurance you may need. Next, we will explore what the best homeowners insurance is and where to find it.

Best Homeowners Insurance

You do not have to purchase insurance from the company your lender recommends, but determining which is the best homeowners insurance for you fully depends on what you are looking for; make sure to shop around with the resources available online and over the phone to make the best decision for you and your family to get quotes from at least 5 companies. The best way to do this is to speak with an independent agent instead of speaking to a traditional agent within the company; since they are knowledgeable and unbiased towards a specific company, getting their input in your journey to understanding home insurance will be valuable. While these brokers do get a commission which you need to factor into your premium cost, you will be able to get more options from a variety of different companies.  

Also, take the time to get educated and understand the differences in pricing for similar products and services between companies using unbiased sources including your state insurance department, consumer publications, neighbors or friends, and your public library. You can also look at group coverage options such as through credit or trade unions, employers, or association memberships.

We have covered what to look for in the coverage in the section titled “Homeowners Insurance Coverage’s Explained”, so review that section as well. When you are ready to look into the individual companies to decide which is the best homeowners insurance for your specific situation, you should take the below steps:

1. State check: you want to make sure the company you are speaking with is legitimate and creditworthy. Check the Department of Insurance for your state to see what the rating is and whether they are cleared to business in your state. This information should be available online and should also provide the average insurance costs in different counties and cities.

2. Insurance company rating: now that you have confirmation that the company is legit and that they are legally allowed to do business in your state, you can look up information in regards to their good-standing. There are resources available for you to research insurance company scores on the websites for the top credit agencies such as Moody’s, J.D. Power, Standard & Poor as well as the National Association of Insurance Commissioners and Weiss Research. On these sites you will find information about consumer complaints, general feedback, claims processing, and other important data. Some sites will even provide you with a company’s financial standing to indicate whether they have the resources to pay out claims.

3. Claim response: along those lines, you also want to determine how the company’s claim response works.  By asking your agent about their company’s handling of claims, you will be able to figure out whether licensed adjusters or third party call centers will be receiving and processing your claim as having outsourced teams handling claims can cause a delay in your reimbursement from the insurance company. Hold-back provisions (an insurance company’s stand on holding back a portion of their payment until the homeowner proves repairs have started) can also be determined by asking your agent

4. Home insurance reviews: you can also ask your agent what their retention rate is; averages are between 80% and 90% for insurance company customers staying with the same provider.  Online home insurance reviews, annual reports, and word of mouth from people you know will also be good ways to gauge their client satisfaction.

    Home Insurance Advice

Understanding home insurance doesn’t just stop at the kinds of policies, different companies, and the amount of coverage – you also want to know the tips and tricks to getting the most out of your insurance policy.  We’ve gathered some helpful advice which you may be able to apply to your specific situation when choosing the best homeowners insurance for your needs.

  1.    First: discounts!  Don’t be shy to ask the insurance agent for discount points. Below are some tips on ways you can reduce your premium:

·         Security system: having cameras as well as a burglar alarm monitored or tied to a local police station will automatically reduce your annual premium, typically by about 5% or more. The homeowner must present evidence of an active security system such as a bill or a contract.

·         Smoke alarms: while these are more common in newer homes, installing these in older homes can save you 10% or more in annual premiums.

·         Increase your deductible: this is not recommended at all, but if you are looking to reduce your annual premium and have home insurance on the cheap, this is a way to do it. Since the deductible would be higher, repairs that take a few hundred dollars wouldn’t be covered such as replacing the sheetrock around a pipe that was leaking – while these seem like small repairs they can add up so it’s best to really think hard before going down this route.

·         Bundling coverage: you can create a multiple policy insurance bundle such as car and home or health insurance and home (and car!). Insurance companies will provide you with a discount of around 10% on average.

·         Special discounts: request for a breakdown of special discounts that you can maybe apply to your home insurance policy; seniors and individuals who work from home are sometimes eligible for a reduced rate as these individuals will be home more often and therefore leave their homes less prone to theft.

·         Renovating wisely: if you have renovations in your future home plans, look into which materials you want to use. For example, if you are looking to build an addition to your home, wood structures will cost more to insure since they are more flammable and more durable than cement or steel framed structures. Other renovations or additions such as swimming pool and even trampolines can drive the annual insurance costs up by about 10% or more as those are seen as potentially injurious additions.

·         Loyalty pays: the longer you remain with your insurer the greater the chance of them offering a discount on the premium or reducing the deductible down the line.

  2.    Other things such as installing a new roof, adding dead bolt locks, CO2 detectors, sprinkler systems, and even waterproofing can lower your premium as well. If you’re in the financial position to do so, paying off your mortgage will also have a lower premium.

    3.      Check in with your agent every year to ensure you have the best homeowners insurance policy for your current situation as a lot can change in a year, or from the time that you attained the coverage such as:

·         Renovations: if you have made modifications such as added a room, upgraded your kitchen, or made other changes, these may add value to your home which would not be covered in your replacement cost in case of a claim using your old coverage.

·         Other updates: maybe you have disassembled the trampoline, paid off your mortgage, or installed a sophisticated alarm system; you may be able to get your premium reduced with proof of these changes.

  4.      Along those lines, if you live in an area where home values have risen since you purchased the property, it would be recommended to look into the extended replacement value policies and cover your home based on the current market value. Since your policy is likely just covering your mortgage, this would be around 90% of your home’s value at best; if anything were to happen to your home you would be highly limited to the rebuild.

5.      Personal liability can come in handy under a lot of situations as lawsuits have the potential to become very expensive. So while policies typically cover around $100,000 in coverage for personal liability, it is recommended to have at least $300,000 in coverage. The additional protection will increase your premium by a few hundred but can protect you with an additional $1 million thorough an umbrella policy.