You have clients interested in a home. They've toured it multiple times, they like the location, and it has everything they are looking for – yet they still won't make a final decision. There could be one more card you haven't played – the potential for saving on home insurance costs.
Home insurance can be an afterthought for many buyers. After all, they are probably more worried about where their kids will go to school, whether the house has a guest room for when Grandma comes to visit, and whether the neighborhood is safe. But when it comes time to sign on the dotted line, home buyers inevitably must face the reality of home insurance costs. Lenders will require home insurance to be in place before closing on your mortgage.
For some homes, insurance risks can drive up the overall cost. Features such as pools or old roofs and outdated electrical systems can make home insurance premiums skyrocket and could even cause a buyer to have second thoughts, even at the cost of earnest money put down.
On the other side of that coin, some home features can save buyers money on home insurance; over the long term, those savings can be substantial. Such savings could be enough to turn interested home shoppers into committed home buyers. Here are some home features you should point out that typically lower insurance costs:
· Newer homes. They don't have to be brand new – just built within the past 10 years.Home insurance providers prefer them because they have modern plumbing and electric wiring, as well as a sturdy new roof. Those factors lessen the likelihood of claims. Buyers can be rewarded with preferred policies, which have lower premiums, or with discounts.
· Location. It's important to buyers, and it's also important to insurance carriers. Is the home close to a highly rated fire department? It can lower the cost of insurance. Is the home located in a moderate- or low-risk flood plain? The buyer won't be required to purchase flood insurance in that case. Now it should be noted that 20% of all flood insurance claims come from locations that aren't high risk, so buying flood insurance is always a good idea. Rates are much lower when you're not in a high-risk location.
· Security precautions. These are an added bonus in any home because they lessen the likelihood of a break-in. A home with a monitored security system could be eligible for a discount on premiums of up to 15%. Even deadbolt locks can lead to savings of 5%.
· Fire prevention. As already mentioned, living near a fire department is a plus. So is living near a fire hydrant. Working smoke alarms also can lead to discounts.
· Green homes are another area homeowners can find price breaks on their insurance premiums. Some insurance providers offer discounts for LEED-certified homes because they are considered more durable than traditional homes. It's not bad to point out to your buyers that while they are lowering their carbon footprint, they also could be cutting their home insurance premium.
Insurance may not be the first card you play when trying to close a sale, but it just might provide the tipping point. Do your research ahead of time and know which of the home's features may give your buyer the best discounts. An insurance-friendly home can pay off big for your buyer in the long run. For more information on insurance friendly homes, potential buyers can check out these videos from Homeinsurance.com.
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