5 Insurance Tips for First-Time Home Buyers
Buying your first home is one of the most exciting events of your life and there can be nothing more overwhelming than this. But at the same time, you need to consider a lot of factors – whether you are looking for homes sale in Ajax, or thinking of investing in Hamilton look for the right property or to chase the right mortgage, hire a real estate agent or do it all on your own etc. While considering so many factors, you may forget planning about home insurance, which plays a major role when it comes to closing your house. Make sure you consider the ongoing cost of home insurance into the budget of home buying. This is important because it will show up in the monthly mortgage payment along with your property taxes, interest and loan principal. It is important to know the basics of insuring your property and how far the cost of coverage could go up. Once you have chosen a house and are trying to negotiate its price, make sure that you also find a reliable and reputed insurer. Before you sign the deal with any one insurance provider, you need to consider certain factors mentioned by experts and real estate blogs that will help you save money as mentioned below:
• Check out several options – The price of home insurance varies a lot with the different carriers. This is so because each of the providers follows different algorithms in order to determine the customer premiums. This is why you need to check out several options before you finalize the deal with anyone. Make sure you get quotes from different companies so that you can compare and save yourself hundreds of dollars by choosing the best of the lot.
• Maintain good credit report – Perhaps you already know that a good credit score can help you get a favorable interest rate on your mortgage. But did you know that it also plays an important role when it comes to home insurance? Well, it does because most of the insurance providers consider your credit report as one of the key factors to assess your credibility as a policy holder. As the market trend shows, consumers who have a good credit report are much less likely to file claims. Before getting involved in the buying process, assess your credit report carefully and do the needful in order to improve your score.
• Bundle your policies – If you have a car and it's time to renew its insurance, consider buying auto and home insurance from the same provider. Since most of the insurance providers sell both these types of insurance, you can save as much as 20% on the annual premium if you buy them from one provider. If you have more than one vehicles or even a boat, you can tie up the insurance of all these with one carrier.
• Don't skimp on coverage – Although you should make every possible attempt to save money on home insurance, make sure you don't skimp on coverage. The standard home insurance policies offer protection from different potential risks. This can range from damage due to weather related perils to liability. You should always try to add or adjust the coverage based on your requirements.
• Evaluate the risks right from the beginning – While evaluating different aspects of your potential home, you should also consider the risk that it proposes. Check if the house is situated on a high-risk flood plain. Remember that standard home insurances don’t cover flooding. To give your property protection from flooding, a separate policy issued by the National Flood Insurance Program is necessary. Remember that flood water accumulating even for a few inches can wreck havoc equivalent to thousands of dollars. Therefore, it pays to buy insurance for such protection.
As a first-time home buyer, keep these five insurance tips in mind to get the best deals.