Tips on Saving on Home Owners Insurance and on Your Property Taxes
Unless you are putting down a substantial deposit on your home and you finance your home through a conventional mortgage lender, you will have to include an escrow payment each month for you homeowners insurance, property taxes and private mortgage insurance.
This can add a substantial amount of money to each month's mortgage payment.
It pays to do a little homework up front to minimize the amount of money that is added to your base principle and interest mortgage payment.
Here are some suggestions on how and where you can save some money.
Private Mortgage Insurance - Also called PMI, private mortgage insurance is coverage for the lender, purchased by you, the borrower, to protect the bank in the case of default or foreclosure.
In order to avoid the necessity of buying PMI and having this added to your monthly payment, put at least 20% down when you buy a house.
You might also consider a 2nd mortgage (called a piggyback loan at closing) to provide you will the necessary funds to reach the required 20% (or whatever amount is required).
You will have to decide if this option is right for you.
Do not skip on opportunity to purchase title insurance.
This is a small expense but it can save to a tremendous amount of time and money if the ownership of your property is ever legally challenged.
When it comes to property taxes, do not assume that the amount you will owe will be the same amount as the prior owner paid the previous year.
Property assessments are an ongoing activity for many local governments as are the actual tax rates.
Check with your local government office to get an accurate amount.
Make sure you opt for the highest deductible allowed by your insurer.
You will not want to make small claims anyways as these can signal the insurer to raise your rates or drop you outright.
This will save you quite a bit on you annual premium as well.
Install a theft and fire alarm.
Most insurers will provide you with a discount for having such a system installed.
Make sure you have the proper home owner's coverage for your needs.
If you live in a flood plain, on the side of a hill or cliff or along coastal areas, special insurance coverage is needed in addition to a standard home owner's policy to cover floods, slides, wild fires or tropical storm damage.
Make sure the insurer you choose is a highly rated insurance company.
Don't just look at the rate alone.
You will want the financial strength to be there in your time of need in the case of a catastrophic loss.
This can add a substantial amount of money to each month's mortgage payment.
It pays to do a little homework up front to minimize the amount of money that is added to your base principle and interest mortgage payment.
Here are some suggestions on how and where you can save some money.
Private Mortgage Insurance - Also called PMI, private mortgage insurance is coverage for the lender, purchased by you, the borrower, to protect the bank in the case of default or foreclosure.
In order to avoid the necessity of buying PMI and having this added to your monthly payment, put at least 20% down when you buy a house.
You might also consider a 2nd mortgage (called a piggyback loan at closing) to provide you will the necessary funds to reach the required 20% (or whatever amount is required).
You will have to decide if this option is right for you.
Do not skip on opportunity to purchase title insurance.
This is a small expense but it can save to a tremendous amount of time and money if the ownership of your property is ever legally challenged.
When it comes to property taxes, do not assume that the amount you will owe will be the same amount as the prior owner paid the previous year.
Property assessments are an ongoing activity for many local governments as are the actual tax rates.
Check with your local government office to get an accurate amount.
Make sure you opt for the highest deductible allowed by your insurer.
You will not want to make small claims anyways as these can signal the insurer to raise your rates or drop you outright.
This will save you quite a bit on you annual premium as well.
Install a theft and fire alarm.
Most insurers will provide you with a discount for having such a system installed.
Make sure you have the proper home owner's coverage for your needs.
If you live in a flood plain, on the side of a hill or cliff or along coastal areas, special insurance coverage is needed in addition to a standard home owner's policy to cover floods, slides, wild fires or tropical storm damage.
Make sure the insurer you choose is a highly rated insurance company.
Don't just look at the rate alone.
You will want the financial strength to be there in your time of need in the case of a catastrophic loss.