It’s easy for new homeowners to forget the costs of home maintenance after they’ve just bought a house. After getting a home loan, making a down payment and paying property taxes, among other costs, keeping your new house in top shape can seem like a distant task to deal with someday.

Whether through natural disasters such as a storm uprooting a tree that crashes onto your roof, or a busted pipe that floods the bathroom to a broken dishwasher, home repairs are inevitable.

Planning on spending about 1 percent of a property’s value each year is a good place to start when forecasting how much you’ll have to spend on home maintenance. For a $300,000 home, that’s $3,000 per year, or $250 per month.

Who will pay for home repairs? The homeowner, naturally. But some work, such as roof repair after a storm, can fall to a homeowner’s insurance policy if the claim is big enough and the expense is higher than the deductible, and the cause of damage is covered.

Other home repairs can be covered by a home warranty, such as a broken appliance or plumbing problems.

Knowing which to use — insurance, warranty or paying for it yourself — can be confusing for new homeowners. Some may not have a home warranty, but are considering buying one. Here are some factors to know about each:


Homeowner’s insurance

If you have a mortgage, your bank will require that you have insurance to cover any catastrophic losses. That’s the key thing to remember about homeowner’s insurance: it’s meant to pay for major losses and not everyday occurrences.

One of the main reasons for homeowner’s insurance is to cover the cost of rebuilding if the home is destroyed by a fire or other disaster. Extra insurance is typically needed to cover damage from an earthquake or flood.

Burglary may also be covered by an insurance policy, meaning that most things stolen from a home will be replaced.

Home insurance policies also have restrictions, such as one policy paying the full cost of replacing destroyed property, while another only reimburses for the “actual cash value” that’s worth far less than the replacement cost of the home.


Home warranty

A home warranty doesn’t cover the structure, as insurance does, but covers home systems such as electrical, heating, cooling, plumbing and appliances such as the stove, washer and dryer.

When one of these breaks, the home warranty company can be called to schedule an appointment for contractors to come out and make the repair. A small deductible may be required, or you may have to pay a service fee.

To give buyers peace of mind, home warranties are often included in a home sale and paid for by the seller. The warranties usually last for a year, when they can be renewed for as low as $25 a month.

Don’t think of a home warranty as a replacement for home insurance. A warranty won’t cover major perils that could affect the entire structure and your possessions.

When buying a home warranty, you don’t have to buy complete coverage. You can buy different types of coverage, such as for certain appliances or plumbing only.

Homeowners who are unsure about how well a home’s components have been maintained, or who have just depleted their savings to buy a home and don’t want to face additional major expenses, can benefit from a home warranty.

 

Paying yourself

A fund set up just for home maintenance is a good idea for homeowners, giving them a place to set aside at least 1 percent of the value of their home.

Even if they have a home warranty, some problems may not be covered by it and they’ll have to pay for the repairs themselves. For example, home warranties usually don’t cover things that haven’t been properly maintained, such as a furnace.

Home warranties also have dollar limits per repair and per year, which may require an emergency fund to fill in the gap if many repairs are needed within a year.

In deciding how to pay for a specific home repair, first consider how catastrophic it is and the cost. If it’s so bad and expensive that your insurance is needed, then use it — that’s what it’s there for.

But if it’s something smaller — even though a leaking window can seem like a disaster during a rainstorm, for instance — then either plan on paying for it yourself or check if your home warranty covers it.

Having all three of these types of ways to pay for home repairs can at least give you greater peace of mind and help make a sleepless night worrying about how you’ll pay for them a little less restless.

Aaron Crowe is a freelance journalist who covers insurance and personal finance for a variety of websites, include his site CashSmarter.com.