You work hard to get clients. Then you work hard find them their dream home. You strive to be an informed and exceptional Real Estate professional and to offer your clients the best service possible. But with all the moving parts of a home closing, it’s easy for things to get missed. After all, you’re the master of your field…..but you can’t know everything. Between inspections, the mortgage details, home insurance…..all the terms and processes can get confusing for you even as a professional. Imagine how much more so for your client.
The CHOICE Insurance Agency strives to offer exceptional service, excellent rates and to be a top-notch resource for you and your clients. To help, we’ve compiled a list of closing timelines and tips and pointers for each phase that you can use as a resource for yourself…or share with your clients. Keeping your clients, especially your new home buyers, in the loop on the process not only establishes you as a valuable resource but also can ease their mind and keep them informed.
1- ) This is it!!
You did it! After countless showings, they picked “the one”! Congrats! Before you submit an offer and get the paperwork going….there are a few things that you need to do first.
- Call us to request that the property be mapped for a flood zone and that you get a premium proposal for flood insurance:
Countless deals fall through for our Real Estate partners every day because they skip this step. People think, their house isn’t in a flood zone so they don’t worry about checking, only to get to the mortgage portion of closing to find out that flood insurance is not only required, but that the premium to purchase the required policy puts them over their approved loan amount.
When this happens, the homeowner is facing a few different options:
- Look into mitigation, which while it is often a great solution, can be costly and time consuming.
- Find a different house, which means you’re back to the drawing board.
- Pay for the flood policy out of pocket, which increases the amount of funding they have to supply for the closing and often leads to unhappy clients.
- What checking the Flood zoning can do for your home closing and how we can help:
- Checking the flood zone before making an offer and getting knee-deep in the closing process helps save you and your client time, frustration, and money. CHOICE will provide a 100% FREE zone determination, flood premium proposal, and offer suggestions on possible mitigation strategies that could help lower your premium if needed.
- The vast majority of flood insurance is through FEMA. There is a very small (approximately 2% of the market) that is covered by private flood companies. However, the vast majority of the flood insurance market is dominated by FEMA coverage. The primary difference in flood premiums for a property will come from the experience and knowledge of the specific agent. Picking a good insurance partner can mean the difference between getting recommendations to get you to closing…..or losing the deal.
2-) What’s Next? You’ve got to have home insurance.
Without exception (except possibly for cash purchases), your client will have to have insurance to close on their new dream home. But in the midst of everything you’re doing to get the property negotiations done, getting inspections, etc….your client calls and says that the mortgage company is calling them and saying that they need the “dec page” for insurance. They don’t know what it means, your closing is four weeks away, and you think, “Gosh! Why isn’t the insurance company doing their job?!?!” Hold on. Let’s look into the “why” behind the confusion.
- You know how you’ve got time frames to get inspections done, etc.? How the mortgage company’s rate will expire after a set period of time for the loan? Well, in insurance we have time frames as well.
- When the mortgage company is requesting a “dec page” (short for declarations page), what they are asking for is proof that the property is actively covered by insurance. They will need this proof for closing or else your client may be facing “force placed” insurance which is selected by the mortgage company, typically doesn’t offer the best coverage, and is usually MUCH more expensive.
- In Insurance, we have a requirement to issue a policy that is called, “insurable interest”. This means that the person listed on the home needs to own (or be under contract and close to owning) the property. We typically wait until about 7 days before closing to issue the “dec page” (proof of active insurance coverage). Why? Well, you know how closings get delayed? How issues pop up? Well here is it what happens with that for insurance:
If we issue an insurance policy, that policy is active. All home insurance is subject to a home inspection from the underwriting department of the company regardless of what insurance company you choose. If the insurance is in place and the closing gets moved and the inspector comes out before your client has taken possession of the property….the policy can get cancelled. Yikes! Now you’re right on top of your closing time….and your clients are trying to shop for insurance. …again. Not good.
- The other reason that we wait is that delays or cancellations of the insurance policy can cost your clients money. Let’s say your client has a closing date of June 1. We make the policy effective for them on June 1 and release a dec page to the mortgage company on May 15th. Sounds good, right? Well, now there are delays for whatever reason and the closing gets moved to July 1. We have to cancel the existing policy and re-write a new policy for them. This could include rate changes for the region or countless other factors. If the premium changes at all for any reason….that has to be updated with the mortgage company which requires paperwork to be revised and…..you can see what a mess this causes?
- So what’s the better option? We can supply a proposal that shows the premium, the coverages and all other details to the mortgage company. This gives them what they need to know (really, the coverage limits and the premium) so they can keep the ball rolling on their end. Then, shortly before the closing date (seven days works well typically), we hit the “issue” button on the policy and off goes the dec page to all parties that need it. It makes the closing a lot easier for all departments involved and takes a lot of last-minute stress off of your client.
3-) How can we make this process easier for you and your clients?
- The CHOICE Insurance Agency works as a brokerage, which means that we have access to carriers that can cover coastal risks and tricky properties.
- We are a “one-stop-shop”, meaning we can cover whatever policy protection your client needs and give them one point of contact! Home, auto, financial planning, Commercial, Life insurance, condo…we can cover it all for them AND they get to save even more by bundling for super discounts.
- We provide FREE consultations and a holistic view of protection for our clients to help them get the protection they need and the discounts they deserve.
- Some companies will charge for consultations for FLOOD insurance. We offer this as a FREE service.
To get the tailored policy coverage that you need for your home, valuables, auto, LIFE, or business, call The CHOICE Insurance Team today at 757-416-5100 and ask for a free, comprehensive review. Give us a call today!
All the Best,
The CHOICE Team
In 2008 Choice Insurance Agency was created out of the former Realty Consultants Insurance Agency founded in 1980 by George Ayers Capt. USN Ret. Since 2008 the Choice Insurance Agency has more than tripled in size and is continue on a track of rapid growth. The Choice Insurance Agency focuses on four areas of expertise: Private Client Group, Coastal Coverage, Senior Programs and Commercial/Business Insurance. Our business model has allowed us to expand into all of the states on the Eastern Seaboard from New York to Florida including Pennsylvania and DC to better serve our ever-growing client base. As an Insurance brokerage stationed in Hampton Roads with access to well over 40+ insurance carriers, the Choice Insurance Agency is able to shop for the best rates, cover those picky coastal zones and create a tailored plan to fit your insurance needs. The Choice Insurance Agency. Call us today and see why we are the top “CHOICE” in Hampton Roads.