Lenders are now requiring homeowners of condos and townhouses to insure the fixtures and contents within their home. HOA dues (usually) cover insurance for just the outside of your unit and the development as a whole, not the inside. This can potentially change your homeownership obligation.
The type of insurance required is called a “walls-in” coverage policy. It was explained to me by one of my lenders as follows:
“We now require the borrower to have insurance to cover drywall, cabinets, stove, etc. Typically, a condo blanket policy will only insure to the studs. If you tip the home upside down, whatever doesn’t fall out is what needs to be insured.”
Although this never used to be required to get the loan, it is a smart thing to have, in addition to insuring your personal contents.
Trackbacks/Pingbacks