How to Get Homeowners Insurance on a Foreclosure
If your home is in foreclosure, you need to continue to pay your homeowners insurance in order to protect your property. You own the home and are responsible for it if it is damaged or destroyed or if someone gets hurt while on your property. But if you fall behind on mortgage payments, who will pay your insurance? Maintain insurance on your home even if it is in foreclosure.
Other People Are Reading
Instructions
-
-
1
Before attempting to purchase homeowner's insurance, contact your lender. Even though it is foreclosing on your home, you may have had enough funds in escrow to pay your insurance. No lender is likely to allow your insurance to lapse even when you cannot make payments. The lender is in the business of protecting its investment from the possibility of total loss.
-
2
Call your insurance company to notify it that your home is being foreclosed. In the event that there are no funds in escrow, your insurance company may have already worked things out with your lender to put into effect what is known as forced-place insurance. This is where the lender buys insurance to protect its investment. If your lender chose to insure elsewhere, ask your insurance company for a refund of premiums paid.
-
-
3
Ensure your home is occupied. If you have been making payments directly to your insurer and your policy has been canceled because the home is vacant, then you need to ensure coverage until your home is foreclosed. But many lenders do not insure vacant properties, fearing vandalism, fire, theft or other problems common with a vacant home. According to Insure.com, if you are unable to find regular insurance, you may be able to find a lender who specializes in insuring vacant homes. Rates are high, and you may find it cheaper to move back into the home until it has been sold. Contact insurers for referrals to companies providing this type of coverage.
-
1
Tips & Warnings
Call your state's department of insurance to see if you qualify for a state-sponsored insurance plan for people who cannot get homeowners insurance.
