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Insurance Inspections/FHA Requirements And Your Transaction
We all know that when buying a home, finding funding and binding a homeowner policy is a part of the transaction process. But what many RE agents don't know is that attempting to do so could blow your deal.
FHA conditions reports and insurance underwriting guidelines have changed dramatically since the storm seasons of 2004-2005. And conditions of property are of great concern to lenders and the insurance industry. Why? Defects and poor conditions = greater risk.
Mass devastation and record setting insurance claims due to subsequent damage from the previous storm seasons has forced HUD and insurance carriers writing policies in Florida to re-evaluate how they conduct their business. Compiled with the slowed economy and down investment market (where insurance companies make a significant portion of their revenue) has forced them to adjust their policy guidelines to minimize risk.
On the insurance side of things, insurance companies don't want to insure a dwelling that could potentially cause a claim and payout. The way this is managed is by evaluating risk. The means in which is done witha few simple inspections. (1) Adjusting or setting a premium via a Wind Mitigation Verification (not used for binding policy rather in part to set ... more
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