Owning land or real estate, to be in a home that a patron can call their own is in essence the dream of freedom. To have a place that can honestly be called one’s own. To be able to worship freely how one wants, to be able to protect the property that is considered ones own. To be able to go out and use free speech, especially defending the things that are ones own. The beauty of capitalism, is that someone who does not have all the money to pay for that coveted property up front can go to an institution that deals in capitol can borrow the amount needed to buy the property. Part of the catch is that the worth of the property is what is the backing the loan. Meaning if the borrower cannot make good on their loan, the lender has claim on the property they lent the money to buy.

When the lender gives out there money, they are confident that the money is safe because if the lender cannot make their payments, then they can just take the property and sell it and get the money back from the loan. The problem is if the property loses its value. What if a home burns down and there is a two hundred thousand dollar loan on it and the borrower now has no incentive to make the loan payments and there is nothing the bank can do about it because no one would buy the property for anywhere near the amount they would if there was still a home on it.

The free market solution is homeowners insurance. Homeowners insurance is a fund set up by a company that is paid into once a year that will insure the property creating a safety net for floods, hurricanes, earthquakes, fires, or any other natural disaster that can occur.

The problem with homeowners insurance is that people tend to get pretty frustrated with it. The likelihood of losing a home to a freak weather condition is very unlikely and usually does not happen and it feels like the insurance is something that will never be used. This feeling is further compounded by the fact that health insurance is used all the time or at least once in a persons lifetime and the same thing with car insurance, there is a much greater risk while on the road of accident than a well built home has on average.

With that said, there are some important things to note about insurance. One it is super important to know the homes proper value. Having a builder or an appraiser value the home will make sure the full amount is insured. Second, every policy is different. An insured person needs to recognize that it is beneficial to shop around when it comes to buying a policy. Some homeowners insurance policies will cover things like electronics and precious medals kept at the home.

Another thing that most people do not recognize is that most insurance companies offer discounts for meeting certain criteria. Find out what the criteria is and if it is met. Meeting discount criteria is a great way to save a lot of money over time.

Author Bio: Juhlin Youlien writes about Fountain Hills AZ Homes for sale and Paradise Valley AZ homes.

Category: Real Estate
Keywords: homes for sale, real estate, buying a home, selling a home, loan, mortgage, foreclosurehomes for sal