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tray831
Dee-licious!
Member since 3/06 5355 total posts
Name:
His Baby
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Home Insurance: Does everyone pay a year in full at closing?
I have no problem paying home insurance for an entire year upfront at closing, but what I dont understand is once my mortgage payments start, I still have pay the home insurance monthly. Why? If I already gave a year up front.
Can someone explain this to me? I am so confused and I am just not getting it. Where does that entire year up front go? Why are we paying double for the first year of homeownership.
Anyone who can explain this to me.........I thank you A LOT!
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Posted 3/12/07 9:57 AM  |
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Long Island Weddings
Long Island's Largest Bridal Resource | Prudential Douglas Elliman Real Estate |
november12003
Love my boys...
Member since 5/05 2412 total posts
Name:
Jenn
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Re: Home Insurance: Does everyone pay a year in full at closing?
I didn't pay a year in full. I just pay monthly.
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| Posted 3/12/07 9:58 AM |
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ali120206
2 Boys
Member since 7/06 17789 total posts
Name:
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Re: Home Insurance: Does everyone pay a year in full at closing?
Is the bank handling your insurance payments? If so, the year you pay at closing goes to the insurance company to pay your insurance and the monthly payments you give to the bank go into an escrow account which will be used to pay next year's insurance premium.
We are planning on paying our own insurance so we're just paying the year at closing and no monthly payment. Next year though, we're going to have to make a large lump sum payment to pay the insurance premium for next year.
Message edited 3/12/2007 10:05:10 AM.
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| Posted 3/12/07 10:02 AM |
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PotofLuck06
Our Baby Boy Is Here!!!
Member since 11/06 13241 total posts
Name:
Betsy
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Re: Home Insurance: Does everyone pay a year in full at closing?
We paid a year in full before we went to closing, so we had the certificate to prove we had homeowner's insurance, and then at closing, they added a monthly cost for the homeowner's insurance to be held in escrow, and from our mortgage, the insurance will be paid when the bill is due - the bank will take care of this, just as it will take care of our taxes.
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| Posted 3/12/07 10:02 AM |
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DRMom
Two in Blue
Member since 5/05 20223 total posts
Name:
Melissa
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by tray831
I have no problem paying home insurance for an entire year upfront at closing, but what I dont understand is once my mortgage payments start, I still have pay the home insurance monthly. Why? If I already gave a year up front.
Can someone explain this to me? I am so confused and I am just not getting it. Where does that entire year up front go? Why are we paying double for the first year of homeownership.
Anyone who can explain this to me.........I thank you A LOT!
It goes into escrow. You do NOT have to do this though. You can pay your insurance and taxes separate
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| Posted 3/12/07 10:05 AM |
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MrsSchwags
Soccer Baseball Lax Mom
Member since 10/05 11240 total posts
Name:
Jennifer
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Re: Home Insurance: Does everyone pay a year in full at closing?
we paid for the year upfront. then our payments include next year's insurance.
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| Posted 3/12/07 10:28 AM |
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~Colleen~
my loves...
Member since 5/05 9129 total posts
Name:
guess
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by ali120206
Is the bank handling your insurance payments? If so, the year you pay at closing goes to the insurance company to pay your insurance and the monthly payments you give to the bank go into an escrow account which will be used to pay next year's insurance premium.
Exactly. We paid our HO's upfront for the year and are paying monthly into escrow for next year.
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| Posted 3/12/07 10:32 AM |
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lululu
LIF Adult
Member since 7/05 9508 total posts
Name:
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by ~Colleen~
Posted by ali120206
Is the bank handling your insurance payments? If so, the year you pay at closing goes to the insurance company to pay your insurance and the monthly payments you give to the bank go into an escrow account which will be used to pay next year's insurance premium.
Exactly. We paid our HO's upfront for the year and are paying monthly into escrow for next year.
Us too.
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| Posted 3/12/07 10:34 AM |
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tray831
Dee-licious!
Member since 3/06 5355 total posts
Name:
His Baby
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Re: Home Insurance: Does everyone pay a year in full at closing?
But if money goes into escrow for next year, I'll still be paying every month (forever). There are no months that I won't have to pay ever which doesnt make sense.
There will always be "extra" money that was given out for insurance. It just feels like a rip off. I hate when people handle my money.
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| Posted 3/12/07 10:42 AM |
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ali120206
2 Boys
Member since 7/06 17789 total posts
Name:
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by tray831
But if money goes into escrow for next year, I'll still be paying every month (forever). There are no months that I won't have to pay ever which doesnt make sense.
There will always be "extra" money that was given out for insurance. It just feels like a rip off. I hate when people handle my money.
That's why we decided we were going to pay taxes/insurance ourselves. Our commitment letter waives escrow for the closing.
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| Posted 3/12/07 10:45 AM |
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NoStressMom
My Heart and Soul
Member since 5/05 11122 total posts
Name:
D
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by PotofLuck06
We paid a year in full before we went to closing, so we had the certificate to prove we had homeowner's insurance, and then at closing, they added a monthly cost for the homeowner's insurance to be held in escrow, and from our mortgage, the insurance will be paid when the bill is due - the bank will take care of this, just as it will take care of our taxes.
Same here
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| Posted 3/12/07 11:13 AM |
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ckone
LIF Adult
Member since 8/06 3014 total posts
Name:
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Re: Home Insurance: Does everyone pay a year in full at closing?
I paid the first year directly to them before closing but as of the closing date. I had to prove that I had insurancce as a condition.
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| Posted 3/12/07 12:43 PM |
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csorisi
My 2 LOVES
Member since 11/05 1984 total posts
Name:
Corinne
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Re: Home Insurance: Does everyone pay a year in full at closing?
Posted by tray831
But if money goes into escrow for next year, I'll still be paying every month (forever). There are no months that I won't have to pay ever which doesnt make sense.
There will always be "extra" money that was given out for insurance. It just feels like a rip off. I hate when people handle my money.
That is exactly why we handled our own taxes and insurance and save money in ING every month and pay it when the bill comes--plus I have my car, umbrella & ring insurance with my house insurance.
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| Posted 3/12/07 1:23 PM |
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