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How To Determine How Much Home Warranty Coverage To Get By Using A CLUE Report

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One of the benefits given to military service members and veterans is the ability to buy a home with no down payment through a Veteran's Administration loan. Clearly, there are many responsibilities that go along with buying a home of your own. It can definitely leave you with a lot of concerns that you otherwise didn't have when you were living in the barracks, in on-base housing, or renting on the economy.

This is particularly true regarding the upkeep, maintenance, and repair expenses that go along with owning real estate property. Fortunately, there is something you can do to prepare yourself for those types of inevitable expenses—get a home warranty. Here's what you need to know. 

Get a CLUE: Comprehensive Loss Underwriting Exchange  

Homeowner's insurance companies use CLUE reports of previous insurance claims to determine whether or not a particularly property is at high risk of future insurance claims. If the previous homeowner had made several claims it could drive up the costs of your homeowner's insurance premiums or prevent you from obtaining insurance due to companies not wanting to take a huge risk.

With that said, this report can give you a lot of information regarding the home that you may not find out otherwise, especially if a previous homeowner did not disclose the information such as hail damage on the roof or a flood in the basement. The information can only be obtained by the current homeowner and that person must have the name(s) of the previous homeowner(s) to check the database. You can obtain the names through your county's tax assessment or land records office at the courthouse and then request a CLUE report

Use the Information to Choose a Home Warranty 

Study the CLUE report and use it to help you understand what typical problems may occur, such as flooding in the spring. You should also pay close attention to the various installment and repair dates of different appliances, mechanical components, and building materials. Compare these numbers to the lifespan report portion of the home inspection service's report to determine how likely or not there will be repairs or replacements necessary in the future. 

If the majority of the appliances and functional components in the home are older, you may want to consider speaking with a home warranty company about getting an extensive home warranty that will cover as many repair and replacement costs as possible. Keep in mind that a home warranty should not be confused with home insurance; a home warranty will cover the costs of basic wear and tear whereas a home insurance policy would not.