Homeowners insurance is not required by law like automobile liability insurance. However, it is required by mortgage companies to protect the lender’s investment. Even if you were able to pay cash for your home, homeowners insurance is an important protection for what is likely your biggest asset. Following are some tips about homeowners insurance for first time home buyers.
Get Renters Insurance to Help Lower Your Homeowners Insurance Premiums
Renters insurance can not only protect you from losses, such as fire and theft, while you are renting, it can also help you save money when you buy your first home. Insurance companies offer discounts to people with loss-free claims histories. Having an inexpensive renters insurance policy for a few years prior to purchasing a home is a good financial investment, as it may save you a significant amount on your homeowners insurance premiums in the future. Our agents at Patterson Insurance Management, Inc. in Odenton, Maryland can assist you with both renters and homeowners insurance.
Factor Homeowners Insurance into Your Calculations
When you are calculating how much your mortgage payments will be, ensure you factor in homeowners insurance. Like property taxes, your insurance premiums will likely be paid out of an escrow account and added to your monthly mortgage payment.
Consider Property Features When Shopping for Homeowners Insurance
Different features of your new home can factor into the type of coverage you need. For example, if your home has a security system, a swimming pool, or a trampoline, or even if you own certain breeds of dogs, it can impact your coverage needs. If you live in a flood zone, you will need a separate insurance policy to cover the risk of flooding.
Bundle Policies to Save Money
Think of bundling as a discount for buying in bulk. Buying your homeowners insurance, automobile insurance, and life insurance from the same company can lower your rates by up to 25 percent.
Consider Raising Your Deductible
One way to lower premiums is to raise the amount of your per claim deductible. Although it will instantly lower your rates, raising your deductible is a decision you will need to consider carefully.
Mortgage Insurance May Be Cheaper through an Agent than through Your Lender
When you are buying a home, your bank or mortgage lender may offer you mortgage insurance to protect the investment. Lenders want to ensure that they will get their money back should anything happen to the borrower. Their rates may be based on their average client, which may be far higher in cost than you would pay if you went through one of our insurance agents at Patterson Insurance Management, Inc. in Odenton, Maryland.
Start Shopping Early for Homeowners Insurance
Too many first-time home buyers leave homeowners insurance to the last minute. This is a mistake that can leave you with limited options. You may feel pressured into deciding quickly, without time to carefully consider the coverage you actually need. A knowledgeable agent at Patterson Insurance Management, Inc. in Odenton, Maryland can help you find a homeowners insurance policy that suits your needs.