If you’re like most people this year, then auto tabs have nothing to do with buying a home but if you’re planning on buying a home in MN, then the state’s new requirement that you show proof of insurance to renew your tabs gives you an excuse to talk to your insurance agent on upcoming insurance savings on your home. We’ve discussed saving money on utilities but homeowner’s insurance is an overlooked element of saving money on your monthly mortgage payment.
Each person’s situation is unique but here’s a sample of some things you can learn about on your call:
- Having current property insurance (even if it’s just renters insurance) will usually saves someone $100/year on their new homeowners insurance.
- Most MN homeowners policies automatically provide up to 10% of a person’s coverage limit for any detached structures. So a 2 car detached garage is usually automatically covered without needing to increase the replacement cost of a home. Whereas an attached 2 car garage needs to be factored into the replacement cost calculation. So in short, detached garages are typically covered for no additional cost to the insured.
- Most companies offer some type (or combination) of “age of utilities” discount. This discount is typically somewhere between $50 and $250 per year. The 4 major systems that insurers are usually looking at in this regard are the roof, the furnace, the plumbing and the electrical.
- If it’s discovered in the insurance underwriting process that the sellers of a given home have made a claim on their policy within the past few years, then there is a good chance that the roof might have been redone (or even a portion or slope of the roof might be new). This can make a big difference in someone’s insurance rates over first 10 years of home ownership.
- When insuring an older home, it’s important to designate whether a person wants their replacement cost calculated with original or modern construction quality. The difference on this question could easily mean an extra $100,000 to $200,000 in replacement cost… which then of course drives the premium.
- Anything a person can do to improve their credit will typically/likely have a positive impact on their insurance rates as well.
- Insuring your home and autos with the same carrier is typically worth it, for MOST home buyers. There are of course scenarios where it is not… but in general it is.
In my experience, the clients I have that make these proactive calls end up having lower insurance costs as a percentage of their overall monthly payment as a result. As you add to your personal financial checklist, you may want to include this task. And if you’re planning on buying a home this year, make sure to call in before renewing your tabs. 🙂
Charles Dailey – NMLS 79048 – Branch Manager, Loan Officer, Certified Military Housing Specialist – – firstname.lastname@example.org
The Home Buyers Scouting Report® is provided directly to the buyer by HBM II, a licensed national real estate brokerage service company, not to or through a lender. The FREE home finding service is provided directly to prospective homebuyers by HBM II and its real estate brokers, as part of their ordinary real estate brokerage services. HBM II, Inc. works cooperatively with other real estate agents across the United States in attempting to find ready, willing and able buyers for homes listed for sale. The role of the Preferred Loan Officer is to assist in determining a comfortable home price range for Home Buyers Marketing II, Inc. (HBM II) to use when it is searching for property listings within the buyer’s search criteria.