In most cases, you’ll be asked to provide proof that you’ve prepaid one year’s worth of coverage before the lender will set closing. The lender holds a lien on the property until the mortgage has been paid off. To safeguard their interest, lenders want financial protection in the form of a home insurance policy to pay for the cost of rebuilding your home, should disaster occur. A standard homeowner’s insurance policy generally protects against (among other items): + + Fire and lightning + + Damage from hail and windstorms + + Theft and vandalism + + Smoke damage + + Falling objects, like tree branches + + Damage from the weight of ice, snow, or sleet + + Frozen plumbing, heating, AC, or other household systems + + Damage done by other vehicles + + Riots or civil commotions + + Explosions Homeowner’s insurance policies also generally include coverage for liability, personal belongings, other structures on your property like fences, and additional living expenses if your
home becomes temporarily unlivable. STEP 4: GET A HOME WARRANT
In addition to obtaining homeowner’s insurance, it’s also a good idea to protect yourself with a home warranty as part of the closing process, to give you peace of mind and help you sleep at night.
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