The way it used to be:

Buyer puts a contract on a house, goes through all the processes to get to closing, and a few days prior to closing would call his insurance company to get a homeowners’ insurance policy.

The way I prefer:

As part of the Offer to Purchase, we include this form which sets out the following three things:

– Maximum annual premium for Homeowners’ Insurance policy

– Maximum deductible (higher is better, in my opinion)

– Timeline for the Buyer to confirm that he can get sufficient coverage that fits within these limits.

Why?

Part of my job as a Buyer’s Agent in Charlottesville is to be aware of potential pitfalls and minimize surprises. With the proliferation of CLUE Reports, which essentially serve as CarFax reports for houses, sometimes a house can have a “bad credit report” which can impact a buyer’s ability to purchase affordable homeowners’ insurance.

If we can remove one variable from the equation, which this addendum does, we’ve achieved a simple win-win for both the buyer and seller.

The hardest part: explaining this form to other Charlottesville Realtors. 🙂