Call Us (904) 272-4660 ≡ ˟
Insurance Place of Orange Park
Trusted Choice
Call Us (904) 272-4660 999 BLANDING BLVD
ORANGE PARK, FL 32065
  • HOME
  • ABOUT US
    • About Us
    • Employee Directory
    • Privacy Policy
  • AREAS WE SERVE
    • Our Office
    • Fleming Island
    • Jacksonville
    • Orange Park
  • GET A QUOTE
  • VIDEOS
    • Convenience Buying Your Policy
    • Planning Ahead
    • Think before you buy
    • Our Business is Caring
  • CUSTOMER SERVICE
    • Service Forms
    • Payments or Claims
    • Insurance Glossary
    • Important Links
  • BLOG
  • CONTACT
    • Location Map
    • Contact Form
    • Join Our Newsletter
    • Refer a Friend
Home > Blog > Why Mortgage Lenders Might Require Homeowners Insurance
MONDAY, DECEMBER 10, 2018

Why Mortgage Lenders Might Require Homeowners Insurance

Mortgage Loan

Few of us can afford to buy our first home using cash. Many buyers will rely on a bank or other mortgage lender to provide them with financial support. However, the bank will also expect the mortgage recipient to do their job in home protection. They'll likely institute a requirement for the buyer to carry homeowners insurance. Why does this rule exist?

With a mortgage, homeowners owe the bank a debt in the form of the home. Thus, any problems in that home represent a potential loss for the mortgage lender. So, the rule for home coverage helps the lender protect their own investment and encourage owners to do the same.

Why Coverage Requirements Exist

When you take out a mortgage to pay off a home, it is not your own money that you will use. Instead, it's the bank's money on loan to you. The bank expects you to repay that sum over the years. If they don't get that money back, that could be a problem for both you, as the homeowner, and the lender.

To your bank, the house itself represents money. It probably does to you, too. Neither party wants to see anything bad happen in the home. Even so, most banks understand that no one can prevent every accident.

That's where the requirement to carry homeowners insurance comes into play. With coverage, you can get financial help cleaning up after unexpected damage. You will also likely be able to rebuild and repair the home to your satisfaction. That's not only a benefit to you, but also to the bank.

If you have home insurance, you can generally return the home to a secure value. Furthermore, you might even cut your own risk of defaulting on a loan or abandoning the property. Given that such actions often prove detrimental to both you and the bank, getting coverage often puts you both in a safer position.

What Protection You Need

All banks will require different amounts of homeowners insurance. However, they generally will want you to carry:

  • Property Insurance to pay for repairs to the dwelling and other structures.
  • Liability Insurance for the personal risks you cause to others.
  • Possessions Insurance to cover your belongings in the home.

Generally, your coverage level must exceed the value of the mortgage. However, you can work with your agent to determine the coverage that will give you most financial return following a home loss. By adjusting your deductibles, limits and other options, you can protect both yourself and the lender.

Contact Us

Posted 12:00 PM

Tags: home insurance, insurance place of orange park
Share |


No Comments


Post a Comment
Required
Required (Not Displayed)
Required


All comments are moderated and stripped of HTML.

NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive
  • 2021
  • 2020
  • 2019
  • 2018
  • 2017

  • insurance place of orange park(21)
  • auto insurance(20)
  • car insurance(13)
  • home insurance(10)
  • general liability insurance(3)
  • insurance(3)
  • mobile home(2)
  • homeowners insurance(2)
  • business insurance(2)
  • commercial insurance(2)
  • auto insurance: comprehensive and collision coverages(1)
  • homeowners and auto insurance(1)
  • love and insurance(1)
  • insurance is for the ones we love.(1)
  • green cove springs(1)
  • dwelling insurance(1)
  • insurance and runner's kick(1)
  • love your insurance!(1)
  • insurance saves the day(1)
  • homeowner insurance(1)
  • homeowner(1)
  • homeowners(1)
  • our business is caring(1)
  • low rates(1)
  • homeowners insurance and tree lighting safety(1)
  • pickering insurance(1)
  • auto(1)
  • flood coverages(1)
  • best practices in high customer service(1)
  • money counts(1)
  • middleburg(1)
  • hurricane(1)
  • clay county(1)
  • safety while traveling in your auto.(1)
  • friends in insurance(1)
  • risk protection(1)
  • and rv insurance(1)
  • good people in insurance protection(1)
  • insurance now(1)
  • your needs first(1)
  • no prior insurance(1)
  • commercial auto insurance(1)
  • hurricane insurance(1)
  • home(1)
  • pickering insurance inc(1)

View Mobile Version
Bristol West
Kemper
Progressive
Universal Property
National General
Security First
Penn America
Berkshire Hathaway
Home| Refer A Friend| Our Location| About Us| Contact Us
Speak to a Specialist
Location

999 Blanding Blvd
Orange Park, FL 32065

P: (904) 272-4660
F: 904-758-4063
E: info@inplaceop.com
Insurance Place of Orange Park
Facebook LinkedIn Google Posts RSS

Powered by Insurance Website Builder