In most cases, yes, you will need to purchase a homeowners insurance policy before the lender will allow the closing to proceed. Otherwise, the loan won’t be finalized and funded — and nobody wants that. In a typical scenario, the borrower will bring either the policy itself, or proof of the purchase, to the closing / settlement process. It can also be faxed to the lender and/or escrow company prior to closing.
Home Insurance Protects You, as Well as the Lender. This is why most lenders require proof of coverage before closing. They want to make sure their interests are being protected in the event of fire, earthquake, flooding, etc.
The common practice is that you have to bring a homeowners insurance binder with you to the closing procedures. This binder is provided by the insurer and is proof that you have a policy in place that covers the property. In some cases, a letter from the insurer will suffice, or a photocopy of the coverage document(s).
You can choose which insurance company you want to use. You should shop around for the best policy, just as you shopped around for the best deal on a home loan. The cost of coverage varies based on the amount of protection, the size of the deductible, and other factors.
In most cases you will need to purchase a basic home insurance policy before closing day comes around.
View Local Agencies Below:
All State Insurance
2600 E. Rt. 34, Sandwich, IL 60548
624 W Veterans Pkwy Ste D Yorkville, IL 60560
American Family Insurance
37 S Main St, Sandwich, IL 60548
110 E Countryside Pkwy Ste A, Yorkville, IL 60560
8 W Washington St, Oswego, IL 60543
Country Financial Insurance
347 W Church St, Sandwich, IL 60548
100 S Latham St. Suite 101, Sandwich, IL 60548
801 No. Bridge St., Ste C, Yorkville, IL 60560
First Insurance Group
11000 E US Highway 34, (Suite 1)Plano, IL 60545
613 E. Church St., Sandwich, IL 60548
141 W. Lincoln Highway, DeKalb, IL 60115
835 W. Church Street, Sandwich, IL 60548
State Farm Insurance
306 E. Church Street Sandwich, IL 60548
623 W. Route 34 Plano, IL 60545
1448 Sycamore Road Yorkville, IL 60560
129 Commercial Drive Yorkville, IL 60560
Somonauk Insurance Agency Inc
145 E. Market Street Somonauk, IL 60552