Just a little heads up… these tips are great for homeowners but you’re wise to pay attention to the tips in this video even if you do not yet own a home, but simply if you plan to.
When you’re getting pre-qualified to buy a home, one of the questions your mortgage lender will ask is the name of your insurance company. This is because 9 times out of 10, your homeowners insurance will be paid by the lender and incorporated as a portion of your monthly mortgage payment.
Home Buying and Homeowners Insurance
So why would shopping for a low insurance premium be almost as important as a low mortgage interest rate? Because there are ratios (mortgage payment to income / and all expenses to income) that you must stay within to qualify. I’ve seen it dozens of times: a home buyer chooses the insurance company they’ve always used, generally one of the well known brands, and their ratios come in too high… they no longer qualify for the loan they’ve applied for.
Heeding this advice in advance can save you a lot of scrambling at the last minute, or can even prevent you from losing the home of your dreams.
Video: Buying a Home? Step One… Lower Your Home Owners Insurance
Video Transcript: Buying a Home? Step One… Lower Your Home Owners Insurance
Welcome to Today’s Home Update, I’m Ingrid.
The cost of homeowners insurance can vary by hundreds of dollars. Here are some tips from the Insurance Information Institute that could help you save big.
Shop around, ask your friends, check the web or contact your state insurance department.
Raise your deductible. Most insurance companies recommend a deductible of at least $500. Raise it to $1000 and you may save as much as 25%.
Don’t confuse what you paid for your house with rebuilding costs. The land under your house isn’t at risk from the perils covered in your homeowners policy, so don’t include it in the value when buying insurance.
Buy multiple policies from the same insurer. Some companies with take 5 to 10% off your premium if you buy two or more policies from them.
Disaster proof your home. You may save on premiums by adding storm shutters, reinforcing your roof, or using stronger roofing materials.
Improve home security. Does your insurer give discounts for smoke detectors, burglar alarm or deadbolt locks? Some companies offer to cut premiums by up to 20% if you install a sprinkler system or a fire/burglar alarm that rings at a central dispatch or monitoring station.
Thanks for watching Today’s Home Update, see you next time.
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eMail: golfarizona@cox.net
Bill Salvatore / Arizona Elite Properties
Residential Sales, Marketing, and Property Management
