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What Kind of Insurance Do You Need When You Buy a House?
What Kind of Insurance Do You Need When You Buy a House?
 
Let me start by saying that I'm not in the insurance business, but that the insurance business is in mine.  And my business is helping home buyers and homeowners get a great mortgage.  So just what are the insurance requirements when you buy a home or go to refinance a mortgage on residential real estate you own in California?  Why does your lender care about the insurance coverage you keep?  
 
Homeowner's Insurance
Also known as "hazard insurance," or "fire insurance," this is the key policy you will be required to carry if you have a mortgage.  While the actual coverage may seem to be a clear benefit to you, there's a mutual benefit for the lender.  After all, the home is both where you live and the collateral for the lender's loan.  Without the home itself, it's unlikely the lender would/could ever be paid back in the event of a loss.  By this logic, some homeowners who are "free and clear," meaning they have no mortgage, will opt not to carry a homeowner's policy.  In the event of a total loss from a fire, for example, they would be completely out of ... more

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