Monthly Archives: November 2016

Why Do Some Mortgage Lenders Require Flood Insurance?

Flooding is the most common natural disaster in the United States. In the most flood-prone parts of the country, most mortgage lenders won’t finance property unless the owners’ purchase flood insurance.

Even if your mortgage lender doesn’t force you to buy this coverage, however, you might want to consider it. This post explains what flood insurance covers, what it costs, and what you’re risking if you go without it.

Flood Damage Is Expensive — And Not Covered By Homeowners Insurance

Homeowners insurance does not cover flood damage. If a storm blows your roof off and rain ruins your rugs and furniture, homeowners’ insurance kicks in. But this only applies to damage from water originating from within your home or directly from the sky.

If water touches the ground before wrecking your house – from rivers, overflowing ditches, flash flooding, etc., your regular home insurer is off the hook.

You can only get flood protection from a flood insurance policy.

Flood Insurance: Who Needs It?

You do, if your property is financed, and it’s in designated flood plain. You might need it even if you don’t live in a flood plain. If a large part of your net worth is tied up in your house or its furnishings, you should consider adding this protection.

An Insurance Information Institute study found that more than one-fifth of claims for flood damage came from people living in low-to-moderate risk areas – folks not required by lenders to buy flood insurance. The National Flood Insurance Program’s web site says that for all practical purposes, “Everyone lives in a flood zone.”

What about disaster relief from the government? That’s usually a low-interest loan, which must be paid back. How Does Flood Insurance Work? National flood insurance is a government program, and policies are old only through licensed insurance agents. Flood insurance rates do not vary between insurers.

You can insure your dwelling for up to $250,000, and its contents for up to $100,000. That’s the limit for government policies, but private insurers can sell you extended coverage.

Flood insurance has a deductible. You can choose a higher one to get a lower premium. However, if coverage is required by your mortgage lender, it may set maximum allowable deductible for its own protection.

It’s important to know that there is a 30-day waiting period for flood insurance; you can’t just buy it once a storm is heading your way.

How Much Does Flood Insurance Cost?

The cost of flood insurance depends on the property location — how high it is (or isn’t) above the 100-year flood level in your area. If you live in a low-to-moderate risk area, you’re eligible for a Preferred Risk Policy (PRP). The chart below shows these policy costs and deductibles.

You can find your risk (and potential flood insurance cost) by entering your address into the flood risk tool provided by FEMA to see your local risk profile.

For those in high-risk areas, flood insurance is required by mortgage lenders, and the cost is not negotiable. You should consider this when you shop for real estate. The table below shows average costs in high-risk locations.

Cost Of Not Having Flood Insurance has a really cool flood damage estimator tool that shows how much damage your home might incur at different levels of flooding.

According to the Insurance Information Institute, less than 13 percent of homeowners carry flood coverage, while one-third of all flood-related disaster assistance, which is provided to uninsured residents, went to those not in designated flood plains.

That’s a lot of people gambling with the biggest asset they own.featured-image-flood-insurance-1

If the market is so hot then why has my house not sold?

The Nashville Real Estate Market continues to thrive. When you combine low rates, the shortage of inventory and a stable booming local economy you end up with a Sellers Market. Yes Sellers have been seeing reduced time on market, stronger offers and in some cases bidding wars. So if the Market is so HOT then why has my house not sold?

Fact: From June to November of of 2016 over 631 homes expired or were withdrawn from the market in just West/SouthWest Nashville and Williamson County. So let’s take a moment and examine why homes may linger and not sell at all even in a hot tight housing market….

The Aggressive Pricing Strategy backfired– Sellers have a natural tendency to desire to get the highest price available for their home. This thinking encourages the “ask high and accept less”.  The “I am not going to give my home away” attitude can be the kiss of death. When a home is priced beyond the comps, it becomes compared with the more expensive properties on the market.  The property is perceived as over priced and inadequate compared to the surrounding listings.  Many times the overpriced home actually sells the other homes on the market. Why is that? Because they are perceived as a better value..they are larger, have more amenities and a better deal for the buyers dollar. After all have you ever met a buyer that wants to overpay? This ends in frustration for all involved.

Underestimating the sophistication level of modern buyers–twenty years ago buyers either had to use multiple brokerages and/or wait for the monthly housing magazine to review local inventory. Buyers today have up to the minute knowledge at their fingertips. Buyers are on line morning, noon and late at night. There are hundreds of websites they can search for the homes they want to see. Some websites even quote a value for the listing.  Frankly the buyers today may know as much as their agent.

Neglecting Maintenance Items–They don’t look like this on House Hunters! If I had a nickle for every time these words were spoken. Fix the roof, repaint if needed and please attend to all odors. No one wants your dirty carpet and messy baths. I tell sellers.. Soap is Cheap…Clean it up!

Lawn Abuse!–Buyers today find your home on line, then they do a quick drive by. If they like the look and the location, then and only then will they contact an agent. The buyer drive by has become the first showing. Mow the lawn, trim, remove weeds and place fresh mulch out. Never forget the importance of Curb Appeal!

Buyers today seek VALUE. Price it right from the start, take care of maintenance items and pack your bags.

RememberNo amount of advertising, Open Houses or incentives will sell an overpriced listing.

Price it right from the beginning.  House key on keychain


7 Quick, Easy Ways to Winterize

November is a great time to winterize your home in preparation for colder weather. Here are a few quick, inexpensive tips for cutting your heating bills.

  1. Use a draft snake. This device was adopted during the Great Depression, and is one of the easiest ways to cut the cold. It’s a long sack filled with sand or kitty litter that you can push into the crack under doors to stop drafts. You can buy a pre-made draft snake, or make your own.
  2. Change the direction of your ceiling fans. Heat rises, so pulling the heat down from the ceiling will warm your room up fast.
  3. If you used a window AC unit in the summer, remove it for winter. Warm air escapes through the vents and the areas around the unit.
  4. Service your heating unit and replace filters. An efficient heating unit will work better and cost less to run.
  5. Consider using window insulation film. This thin layer of film sticks right onto your windows and adds up to 70% more heat retention.
  6. Use a candle to detect subtle air leaks. Light a candle, then move it all around the edge of your windows. If the flame wiggles in the breeze, then caulk that spot on the window.
  7. If you have a fireplace, keep the flue closed when not in use to prevent heat from escaping and cold air from working its way down into the house.