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We are in the process buying a home and we ARE going to get homeowners insurance but I was just wondering if they make you get it? Also I was wondering if anybody knows if I live on a flood plain if i HAVE to get flood insurance too? THANK YOU!

7 Thoughts on Insurance!?
  1. Reply
    Benjamin E
    July 15, 2012 at 1:36 pm

    afaik all lenders require that you purchase homeowners insurance in order to receive a home mortgage loan.

  2. Reply
    frozenbaugh
    July 15, 2012 at 1:45 pm

    Yes, the mortgage company will make you buy insurance. They have a financial interest in your home (the loan). If you have no insurance and there is a total loss, then they would be out all the money they loaned you.

    As for flood insurance, that is the case as well.

  3. Reply
    Mom of 2
    July 15, 2012 at 2:22 pm

    Yes, you have to have homeowners insurance and alot of mortgage companies are now requiring you to give them the bill, they add the amount to your escrow portion of your payment and pay the insurance for you (from your mortgage payment) Too many people said they had insurance, paid the first installment and then couldn’t pay the next and lost the insurance.

    As for the flood plain, Flood insurance is required (atleast in the state of NJ) I live in a town that floods, but luckily have always been outside the flood plains (barely)

  4. Reply
    mbrcatz17
    July 15, 2012 at 2:47 pm

    No, you don’t have to get it, unless you’re borrowing money to buy the house. If you pay cash for the house, no one makes you buy insurance. But a mortgage company won’t give you money to buy a house, unless you have homeowners insurance in place.

    If you’re in a 500 year flood plain, you do NOT need flood insurance. If you’re in a 100 year flood plan, you DO need flood insurance, but again, ONLY if you have a mortgage on the house. There’s no LAW that says you have to have it – it’s a LENDER requirement.

  5. Reply
    blb
    July 15, 2012 at 3:36 pm

    Flood insurance is required by the lenders because it is required by the government. If any home loan is backed with any type of federals funds (very difficult to find one now that isn’t) the lender is required to have flood insurance on the home. If the lender does not have it, the lender can get fined if they are audited.

    You will have to have homeowners insurance in order to close on your loan. If you are paying cash for the house there is no one that will require it.

  6. Reply
    rebelstar704
    July 15, 2012 at 4:26 pm

    yes and yes. banks require insurance up to the amount of the loan, anything after that is your choice. as far as flood goes, if you’re in a high risk flood zone the bank also requires it. sometimes if you’re in a really bad area FEMA might require you to get it.

  7. Reply
    1paris
    July 15, 2012 at 4:49 pm

    yes you must purchase homeowners insurance if you are obtaining a loan. If you are in a certified flood zone you will need to obtain flood insurance as well.

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