We are now a little past halfway through hurricane season here in Myrtle Beach for 2019 and I thought it would be good today to share some tips to help you with purchasing a home in Myrtle Beach during hurricane season. If you follow these tips, it will make your home buying process much easier during this hurricane season.
Buying a home in Myrtle Beach comes with making many decisions, but one of the most important ones has to be the property insurance. You are obtaining a huge asset and often taking a mortgage to purchase. So, insuring the property and covering the debt are not just required by the lender but should be taken very seriously by the buyer. When buying a home, here are 7 important tips to remember when buying a home in Myrtle Beach during hurricane season:
- Choose an experienced local Myrtle Beach insurance agent.
- Obtain quotes prior to contract.
- Don’t just go with the cheapest quote.
- Watch for tropical storm and hurricane warnings during the purchase.
- Consider binding insurance as soon as possible.
- Discuss The Addition of Flood Insurance, Even When Not Required
- Perform a walk through right before closing.
Choose a Local Myrtle Beach Insurance Agent Early
Do your homework and discuss insurance coverage, exclusions, and premiums early with a local Myrtle Beach agent. Even if there isn’t a property chosen yet, get educated on the process, terms, and products. As mentioned, consider flood insurance even if not in a high risk area.
A local insurance agent can discuss this and all other insurance related areas areas. Also, one of the most common delays just before closing is waiting on the insurance binder. This happens typically, when someone wait until the last second to decide on coverage or even tell the agent about the purchase. Don’t be that buyer because lenders will not approve your loan until you have insurance in place and your closing will be delayed!
Obtain Insurance Quote Prior to Contract
Knowing the costs up-front could make or break a purchase. The insurance premium(s) are part of a housing and closing expense. So, it will effect the mortgage payment and the cash to close. Depending on the area and the property, the insurance cost could vary widely. For example, there have been buyers who find that a particular home requires $3,000 per year in flood insurance when it was only expected to be about $500.
That is a major factor in making a decision and could prohibit you from qualifying for the loan! I’ve seen many deals in the past fall apart because the buyer cannot afford the insurance premiums at the price they originally were approved to purchase at because the home required a high insurance premium.
Don’t Just Go With the Cheapest Quote
Of course, the premium and payment are very important, but do not sacrifice coverage for a super discounted premium. If a buyer cannot easily afford to pay an insurance claim shortage, why pay for coverage that won’t rebuild the home adequately? Foremost, make sure the property is covered against perils with a quality company and then get the premium as affordable as you can.
Pick a company that has been established and is familiar with Myrtle Beach area to help you so that if there is a disaster, they will be able to help you fix any damage quickly and get you back into your home. If you are having trouble finding a reasonable quotes, you can always ask your agent to contact the listing agent to find out who the sellers have their insurance currently with.
Tropical Storm and Hurricane Warnings
Be aware when a named storm is approaching Myrtle Beach. Once a named storm is within a certain distance of the coast, insurance companies will not bind or increase insurance coverage. So, with an imminent storm during hurricane season, insurance companies know the risk is much increased.
Thus, no insurance will be written until the property is out of harm. So, buyers need to be proactive and know the options, potential issues, and process early.
Consider Binding Insurance Early
Typically, insurance companies will bind an insurance policy very early with an effective date of the closing. “Binding insurance” means to put the policy in force or to have an effective date. This can be particularly helpful in times where storms are on the way. Keep in mind once the insurance is bound for a certain date, you cannot close prior to the insurance effective date. Make sure to stay in constant communication with your mortgage lender, closing attorney, REALTOR®, and insurance agent on binding the insurance.
Nothing is worse than having a proposed closing date coming and you have to delay everything because the buyer has not yet secured financing. If the binder has been written before the storm is named, they will cover you and you can close on your property on time.
Discuss The Addition of Flood Insurance, Even When Not Required
While many areas of Myrtle Beach do not require flood insurance to close on the home, it is always my recommendation to consider purchasing flood insurance when buying a home as an added level of security.
Back several months ago, I did a quick interview with a local insurance agency regarding flood insurance:
Perform a Walk Through Prior to Closing!
Yay it’s closing day! I know you are so excited and ready to move into your new home. You have made it through the purchase process and all you have to do is sign the paperwork. But, don’t forget to do a final walkthrough.
Just before closing, it is so important to check the home out again because there are so many things that could happen. We have seen movers damaging the home moving out the sellers, broken water lines damaging the home, flooding, and more. Once the home is yours, there are usually not many options for a remedy. Make sure you or at least your buyer’s agent checks it out thoroughly before signing the papers.
I hope you find these tips to buying a home during hurricane season in Myrtle Beach helpful. If you need help buying a home in Myrtle Beach, feel free to reach out!