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| *Loan,banking and credit>>>homeowner insurance |
Does homeowners insurance pay off your mortgage if the house is lost? |
Does homeowners insurance pay off your mortgage if the house is lost? No. Your homeowners insurance will pay out the value of the policy. So, if you have a mortgage of $100,000 and you only have insurance for $80,000 -- the insurance will pay you $80,000. Your best bet is to make sure that your insurance will pay out the full replacement value of the house. That still may not pay your full mortgage (because your mortgage will include the full cost of the property and that includes the land, which the insurance does not pay for in the case of a lost house.) Source(s): financial writer for www.insuranceguide101.com That depends entirely on your policy. Strictly, most people structure the insurance so that their benefit would cover the cost of the mortgage. The two aren't directly tied, so the insurance company would pay you, and you would pay off the mortgage. If your house is mortgage, yes it is! Simple. NO...it covers replacement of your home. Ask the folks in San Diego that lost their homes in the fire...they are still paying on their mortgages... Be sure to update your policy regularly as well....building costs are constantly going up and your homeowners should reflect those escalating costs... In the business It only pays up to the face value of the policy - so if the house is insured for more than the mortgage, less demolition costs, the answer is yes, if the house is "lost" to a covered peril. |
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