Protect Your Investment

March 8, 2017


You may be reading this as you are resting in your home, perhaps having your morning coffee or sitting down at the end of a long day. You can relax at home because you feel safe and protected. This is how we want our homes to feel — a sanctuary from outside elements, whether that be the weather or your certifiable next door neighbor. In any case, no one wants a rude awakening when Murphy’s Law decides to take affect, BUT there is something you can do when purchasing a new home to protect yourself — purchase Homeowner’s Insurance prior to the close of escrow.

There are many things to prepare when purchasing a house and perhaps you may not be aware of these if you are a first-time homebuyer. So, let us tell you why having Homeowner’s Insurance is so important at the close of escrow.

  1. You may not have a choice, it’s likely a lender requirement — your lender has a lien on your house until you’ve paid off your mortgage, as it is technically their property until you have paid off your home (Now if you’re purchasing in all cash, then skip step 1, but our guess is that this doesn’t apply to many and this is at your own risk to not have coverage — and not advised).
  2. Risk and liability — Be aware of the start time of risk and liability for your new purchase — for example, if you fund on the 14th of the month and plan to record and close escrow on the 15th of the month, at midnight of the 15th, the insurance responsibility belongs to you as the new homeowner.
  3. Mother Nature’s touch — safeguard your investment against things that are out of your control, like theft, lightning, fallen tree branches or a backyard bbq gone wrong.


Another tip when purchasing Homeowner’s Insurance — you will want enough coverage to pay for rebuilding your home, should a disaster occur. You may also want to keep track of your personal belongings (contents follow you on the policy if you are a renter buying a home). A good way to do this is to keep a video record of your entire home and all that is in it. There are a couple of reasons for this — for insurance purposes, video all electronics and jewelry (a lot of times people don’t remember what they own) and for insurance if the home floods or has fire damage (for example), you can prove what you have.

Protect one of your largest assets, if not the largest, when you purchase homeowner’s insurance prior to the close of escrow. Happy house hunting!