In reading a back issue of REALTOR (July/August '10) I came across an advertisement for Home Value Protection. It is supposedly some program that buyers or sellers can buy in which it protects a home's value against local market declines. They state it "gives buyers the confidence to buy without fear, and helps sellers to sell faster." I ended up going to the website provided www.workingequity.com/pro but the website said coming soon. I wonder when that will be since it has been several months since this advertisement was released.
Anyways I did a Google search and found a Wikipedia link http://en.wikipedia.org/wiki/Home_Equity_Protection that describes the program a little more in detail. Basically what the program is, is that the person buying the plan purchases it for about 1.5% of the current value and then the person is required to live in the home for at least so many years, usually anywhere from 3-15 years. If they move before this time they get no insurance coverage. Well this might be good for someone moving in 3 years with the current market, this is an absolute waste for someone who stays in their home for 5-10 years. In 5-10 years the home should be worth at least what it was bought for or more, based on historical evidence.
Unfortunately I feel this is another way for another company to make some money with small fine print consequences. If someone it thinking about buying a home and not sure if they are not going to live in the same place for a minimum of 5 years then you probably shouldn't buy. Owning a home is a long term investment. It is not considered to be a short term one. The years of 2000-2005 put different thoughts in peoples minds. A home is a place to raise a family, the feel of security, a place to change as you change without asking a landlord, and a place to welcome guests. It is the American Dream but it was abused. I find this program a joke. I've never seen declining insurance for my phone, tv, or car's value. Why don't they offer insurance for declining values on these?
Comments (3)Subscribe to CommentsComment