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LIMOMx2
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Member since 5/05 24989 total posts
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Does your Homeowners have to cover the amount of your mortgage?
Our current homeowners is for the entire amount of our mortgage not just the dwelling and the person at countrywide said this is the law.
Is that true? She just seemed a bit confused when I was talking to her that is why I ask.
TIA
Message edited 3/26/2007 1:51:10 PM.
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Posted 3/26/07 1:50 PM  |
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iwed2005
LIF Adult
Member since 3/06 1389 total posts
Name:
Julie
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Re: Does your Homeowners have to cover the amount of your mortgage?
sorry a little confused, do you mean homeowners insurance?
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| Posted 3/26/07 1:54 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by iwed2005
sorry a little confused, do you mean homeowners insurance?
yes.
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| Posted 3/26/07 1:56 PM |
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Re: Does your Homeowners have to cover the amount of your mortgage?
My insurance company and mortgage company said that it only has to be for the amount to rebuild the structure, and cover personal articles. I did take it out for the whole mortgage amount which was more then they suggested, but better to have to much then not enough.
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| Posted 3/26/07 1:58 PM |
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iwed2005
LIF Adult
Member since 3/06 1389 total posts
Name:
Julie
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Re: Does your Homeowners have to cover the amount of your mortgage?
call again, i have countrywide and every time i call some people know what they are talking about and others don't. my insurance payments don't cover the mortagage and the total amount of the insurance doesn't either.
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| Posted 3/26/07 1:59 PM |
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ali120206
2 Boys
Member since 7/06 17795 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by bridget-n-jimmy
My insurance company and mortgage company said that it only has to be for the amount to rebuild the structure, and cover personal articles. I did take it out for the whole mortgage amount which was more then they suggested, but better to have to much then not enough.
You can even get policies that don't cover personal articles, these are more common though on "lender-placed" policies (if you let your insurance lapse and your lending institution puts a mandatory policy on your home - you pay a higher premium and get less coverage in most cases).
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| Posted 3/26/07 2:06 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
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Re: Does your Homeowners have to cover the amount of your mortgage?
Thank you. I am having the insurance person look into it. Maybe I am not explaining things right to Countrywide
Our homeowners ins is soooo expensive it is ridiculous
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| Posted 3/26/07 2:06 PM |
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ali120206
2 Boys
Member since 7/06 17795 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by 5ofClubs
Thank you. I am having the insurance person look into it. Maybe I am not explaining things right to Countrywide
Our homeowners ins is soooo expensive it is ridiculous
Good luck!
Not that you would want a dwelling-only policy but, I know Countrywide deals in them so they should understand!
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| Posted 3/26/07 2:08 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by ali120206
Posted by 5ofClubs
Thank you. I am having the insurance person look into it. Maybe I am not explaining things right to Countrywide
Our homeowners ins is soooo expensive it is ridiculous
Good luck!
Not that you would want a dwelling-only policy but, I know Countrywide deals in them so they should understand!
I think almost $2000 for homeowners a yr is ridiculous. I might have to just cut back then on what we have but not do dwelling only.
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| Posted 3/26/07 2:11 PM |
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bikramaddict
mommy-to-be
Member since 8/06 4376 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
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| Posted 3/26/07 2:11 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
That does help thanks
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| Posted 3/26/07 2:14 PM |
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
I did have that info, I just decided it would be better to cover the whole mortgage amount. I have a friend who lost her home in a fire, and being under insured is a nightmare. Even if you go by the rebuild estimate it might not cover the actual amount to rebuild.
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| Posted 3/26/07 2:48 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by bridget-n-jimmy
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
I did have that info, I just decided it would be better to cover the whole mortgage amount. I have a friend who lost her home in a fire, and being under insured is a nightmare. Even if you go by the rebuild estimate it might not cover the actual amount to rebuild.
Good to know too. It just seems ridiculous what we pay. Everyone seems to pay so much less then us.
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| Posted 3/26/07 2:50 PM |
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Eva Luna
Be kind...life's hard!
Member since 8/05 4750 total posts
Name:
God, bless & heal my DH, JenG's DH Rob & DebG
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by bridget-n-jimmy
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
I did have that info, I just decided it would be better to cover the whole mortgage amount. I have a friend who lost her home in a fire, and being under insured is a nightmare. Even if you go by the rebuild estimate it might not cover the actual amount to rebuild.
I was told that it doesn't matter if you insure it for a lot more. Apparently, if (God forbid) something happens, they'll pay out based on the rebuilding costs, not what was paid...
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| Posted 3/26/07 2:51 PM |
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by Eva Luna
Posted by bridget-n-jimmy
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
I did have that info, I just decided it would be better to cover the whole mortgage amount. I have a friend who lost her home in a fire, and being under insured is a nightmare. Even if you go by the rebuild estimate it might not cover the actual amount to rebuild.
I was told that it doesn't matter if you insure it for a lot more. Apparently, if (God forbid) something happens, they'll pay out based on the rebuilding costs, not what was paid...
Well in my friends case they way underestimated the cost to rebuild and thank goodness she had extra taken out, with a little bit of fighting she did get it covered through the extra.
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| Posted 3/26/07 2:53 PM |
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Re: Does your Homeowners have to cover the amount of your mortgage?
Acutally the best person to ask on here would probably be Smileyd17 she works for an insurance agent.
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| Posted 3/26/07 2:54 PM |
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Eva Luna
Be kind...life's hard!
Member since 8/05 4750 total posts
Name:
God, bless & heal my DH, JenG's DH Rob & DebG
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Re: Does your Homeowners have to cover the amount of your mortgage?
Posted by bridget-n-jimmy
Posted by Eva Luna
Posted by bridget-n-jimmy
Posted by RandJ0806
your mortgage isn't only for the house -- it's essentially the price you paid for the land, too. So taking homeowners for the entire sale price is a little off.
when your house was appraised, you should've received a "rebuild" estimate, w hich is what your homeowners should be for. HTH!
I did have that info, I just decided it would be better to cover the whole mortgage amount. I have a friend who lost her home in a fire, and being under insured is a nightmare. Even if you go by the rebuild estimate it might not cover the actual amount to rebuild.
I was told that it doesn't matter if you insure it for a lot more. Apparently, if (God forbid) something happens, they'll pay out based on the rebuilding costs, not what was paid...
Well in my friends case they way underestimated the cost to rebuild and thank goodness she had extra taken out, with a little bit of fighting she did get it covered through the extra.
That's my worst fear too!!  Thank goodness she had that insurance!
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| Posted 3/26/07 2:54 PM |
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Smileyd17
kids
Member since 5/05 20997 total posts
Name:
Mommy
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Re: Does your Homeowners have to cover the amount of your mortgage?
Yup, Im here!
Ok, its not the law....but can be MANDATORY by a bank.
The bank/lender can require you to take the amount of mortgage...Yes, this is true and most of time does happen.
At times there is getting around it.
Like RandJ0806said earlier, the mortgage is for the market value, Building + Land = Value. Therfore, asking to cover that amount is not realistic since Insurance is only coverage on dwelling the rebuilding value/amt. Insuring it for mortgage amt is OVER insuring the home and if there is a loss, you would never see that whole amount.
Now each homeowners policy offers additional coverage under an endorsement, about 20% (some more).
EX: So if your mortgage amt is say $250k.
We would insure it for $209k plus the 20% (additional amt that is sitting in a reserve if ever needed) to offer $250k coverage therefore not having you to pay this premium of 250k coverage. Esp in cases where the dwelling dosent need to be that high.
The coverage that is determined is the replacement cost value and it is an "estimated" amt done by asking questions re Home and territory etc.
Its never guaranteed so that is why 20% additional is offered as an endorsement.
No company offers a guaranteed replacement cost.
Every yr, the policy should increase due to inflation and anything done to the house should be a flag to notify your insurance company to reasses your home and make sure your house is covered properly.
HTH!
Message edited 3/26/2007 3:12:18 PM.
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| Posted 3/26/07 3:11 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Does your Homeowners have to cover the amount of your mortgage?
Thank you so much. I def think I have wayyyy too much coverage.
TIA it did help a lot!!!!!!!!!!!!
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| Posted 3/26/07 3:16 PM |
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