When you buy a home for the first time there will be many additional expenses to cover along with that mortgage payment. One such regular expense is homeowners’ insurance. This protects your home from damage due to storms, fire, and even vandalism. When you first get insurance on your property it is a good idea to learn as much as you can. There are a number of things that can cause your monthly payment to increase. Professional Lemont IL real estate agent Chris Budz has the scoop on what to look for.
Understanding Homeowner’s Insurance
The way that your premiums are determined includes several factors. The cost of replacing your home in the event that it is damaged or destroyed forms the basis. This is estimated by the size of your home and cost of the materials needed to rebuild. When you renovate or perform upgrades, these new additions will affect your homeowner’s insurance.
If the cost of building materials increases then you may see a jump in monthly insurance premiums. This type of change results from any number of factors related to the economy. If the materials used for your home are in low supply the price can increase, for example.
Another thing that can raise your homeowner’s insurance is any additions to your home. For example, if you put a pool in your backyard or structures like a kids’ playhouse. When the increase of risk increases your premiums will as well. If you choose to build onto your home you might see a rise in expense as well. The reason for this is that the cost of rebuilding your home in the event that it is damaged will be more requiring a higher monthly payment to cover you.
Your Credit Score
It is possible to see an increase in insurance premiums if your credit score decreases. The insurance company might see this as a greater risk of filing a claim and raise your monthly payment. As with anything financial, your credit is a significant factor.
What To Do, What To Do
There are a few things you can do when you see your insurance premiums on the rise. Inquire with your insurance company about any discounts they offer. You can also check out other companies for better rates. There’s always the option of increasing your deductible as well.
For more information on buying your next home in or around Lemont IL contact experienced Lemont Illinois Realtor Chris Budz today!