- What is hazard insurance and who needs it?
- Why does the lender require hazard insurance?
- How much coverage is required?
- What is guaranteed replacement cost?
- How do I increase the insurance coverage if there is not a replacement endorsement?
- What exactly is liability coverage?
- What type of insurance policy is carried on condominiums?
- How and where do I get hazard insurance information?
- How much does insurance coverage cost?
- Is flood insurance a part of standard hazard insurance coverage?
Lesson Excerpt
Answer: Once the loan approval has been made and conditions satisfied, the lender will soon enter into a mutual agreement with the borrower in mortgage financing, giving both parties sharing interest in the property. The lender will require that the borrower maintain a homeowners policy in case of an unforeseen catastrophe. It insures both the interest of the borrower and the lender of any potential loss that might occur. Homeowners insurance will enable the borrower to repair or rebuild their home.
How and where do I get Hazard insurance information?
Answer: In your opening call to the borrower, request the hazard insurance information up front. Request the name of the agency, the agent address and the agents telephone number. Place this information in your file until you have a final approval. Before closing, you should have a copy of the insurance binder page confirming the coverage amount, effective date of policy, correct property address, and the new loss payee with and/or assigns.
