Getting Homeowners Insurance Before Closing

Why Homeowners Insurance Is So Important?

Your home is one of the biggest - if not the biggest - investment you are ever going to make. Between the mortgage, the taxes, the utility bills, the furnishings and all of the other financial obligations that come along with owning a home, you are probably wondering how you can cut costs. Homeowners insurance is one of those things that you need to have, but it can be difficult to understand why you need it - and to pay for - especially since it is pretty intangible. Paying out a few hundred, or a few thousand, dollars each month may be hard to stomach, especially when you aren't seeing the rewards of spending that amount of money. However, while it may seem pretty pointless, homeowners insurance is actually one of the most important things you could ever purchase for your home, and for yourself. Before you decide to skip out on it (which is something you should never, ever do), read on to understand why it is so important to insure your home.

How Important is Getting Homeowners Insurance Before Closing?

Though you may not see the benefits of your insurance in a tangible way, it is actually one of the most important purchases you will make as a homeowner. Here is a look at why it is so important and how it can protect you, your family and your investment.

Protects your Home

It goes without saying that this type of insurance protects your home; your biggest investment. You are going to invest a lot financially, emotionally and mentally in your home. It goes without saying that you are going to want to protect your investment, and that is exactly what homeowners insurance does. No matter how much you try to protect it, you can't always prevent things from happening. Things like fire, flood, damage from the elements and pests, as well as burglary, aren't always possible to avoid. Thanks to insurance, you can keep your investment secured. In the event that there is some type of damage or theft, your homeowners insurance will keep your home - and you - protected. Your insurance will cover the cost of any repairs that need to be paid, and will also cover the loss of anything that may be stolen.

Offers Peace of Mind

Since insurance protects the investment of your home and your personal belongings, it also offers you peace of mind. There is nothing scarier than realizing that your personal possessions, the things you have worked so hard for, could be damaged, lost or stolen. Thanks to this insurance, you will gain a lot of peace of mind because you won't have to worry about having to pay for any damaged, lost or stolen items out of your pocket.

Qualifies You for a Mortgage

Before a lender will provide you with a mortgage, you will be required to obtain insurance. Since lenders usually cover, on average, 80 percent of the value of a home upfront, they want to make sure that what they are investing their money in is protected. So, before you are even able to receive the funding that you will need for your home, you will have to purchase home owners insurance.

Getting Insurance

There are several different insurance providers, and there are a variety of different types of insurance available. Talk to your lender or your real estate agent to find out who they recommend to insure your home. Also, you might want to ask your friends and family members for referrals. Don't just choose the first insurance company you speak with; make sure you shop around. Go with the provider who offers you the best coverage at the most affordable rate.