Homeowners insurance can be a bit confusing for first-time buyers, but if you want a house in Smyrna, you’ll need to learn the basics. Fortunately, banks generally make getting insurance relatively easy for new homeowners, and there are plenty of insurance companies to choose from.
Homeowners insurance does precisely what the name implies: it covers damage and liability costs for the property. Most policies cover both the exterior and interior of the home. The policy will most often include any liability that results from injuries sustained at the property or damage to property, as well. You’ll have to ask about your specific policy, however, because this may vary.
If you do file a claim on your homeowners insurance, it works, for the most part, like any other type of insurance. You’ll have a deductible, and this is the amount you’ll have to pay yourself before your insurance company will pay out any money on a claim. Hence, low deductibles are nice, but they do come at a higher price. You’ll also have a liability limit. This is the maximum amount the policy will pay. You’ll have the option to increase your limit, if you want more insurance on your home.
Whatever policy you choose, you will have to make a choice and get insurance before a bank will issue a mortgage. Fortunately, most banks make this easy and will help you find an appropriate policy.
Homeowners insurance is not the same as a home warranty, which some homeowners might also like to purchase for their home. Home warranties offer coverage for repairs and are usually time limited You don’t have to purchase a home warranty to get a mortgage; it’s entirely optional.
If you’re making a low down payment on your property, you might need to purchase mortgage insurance. This is a different product than homeowners insurance; it covers the extra risk the lender takes when issuing a mortgage to someone making a small down payment.
Talking to a Realtor or a mortgage officer is always a good idea if you have questions. Most of them will be more than happy to share what they know, and can refer you to another expert in the area if needed. Homeowners insurance payments are often added to the monthly mortgage payment, so you don’t have an extra bill coming in every month for the premium. Homeowners insurance is a requirement, so be sure to ask if you have any questions about obtaining it or how it works.