| In most state's, you purchase title insurance | | | | present their homes for sale as perfect, it |
| to ensure you are not also buying the | | | | will not do much good to directly ask them |
| responsibility for earlier liens against the | | | | about previous claims. Also, they may not |
| property. In a finite few states, you pay to | | | | know the history of the homes for sale before |
| have an abstract search to do the same. The | | | | they purchased it. Unfortunately, only a |
| one thing most buyers of homes for sale never | | | | homeowner may order a report from CLUE, |
| think of or do is to check the insurance | | | | called the Home Seller's Disclosure Report. |
| claims history of potential homes for sale. | | | | An insurer will not order information from |
| This could be a crucial mistake. | | | | CLUE until you sign an insurance contract and |
| | | | it goes into underwriting, which you cannot |
| Insurance companies share information with | | | | do until you have signed a purchase contract |
| each other. They use the Comprehensive Loss | | | | for the homes for sale. You can, however, |
| Underwriting Exchange (CLUE), which is a huge | | | | have your realtor put a contingency clause in |
| database of information. CLUE holds the | | | | any homes for sale offer you make that |
| dates, type of loss, and amount paid on | | | | stipulates the sale may be cancelled if a |
| claims to previous owners of your potential | | | | negative CLUE report is received. |
| homes for sale for the past five years. | | | | |
| Information contained in CLUE could very well | | | | If you are a seller of a homes for sale, |
| mean higher homeowners insurance premiums or | | | | getting a CLUE report before putting the |
| no coverage at all for particular homes for | | | | property on the market is a good idea. As in |
| sale. | | | | any report, errors can be made (just think |
| | | | about all of the errors people find in their |
| For example, previous homes for sale water | | | | credit reports). Ordering a report early |
| damage claims are red lights for insurers, | | | | means you can catch any errors and get them |
| because such problems eventually may lead to | | | | corrected. A CLUE report can be ordered from |
| expensive claims of toxic mold. In | | | | ChoiceTrust.com, which also tells you how to |
| California, alone, there have been | | | | correct report errors. Also, locate all of |
| substantial toxic mold claims over the past | | | | the receipts for repairs from all insurance |
| ten years. Some fairly new homes had to be | | | | claims you made, proving to the buyer's |
| completely demolished very costly to those | | | | insurer that the problems no longer exist. |
| insurers. Historically, insurance companies | | | | For previous claims such as water damage, you |
| have found that toxic mold damage is | | | | may even pay for a pre-inspection to ensure |
| generally caused by previous water damage | | | | the problem was adequately repaired and no |
| that was not adequately repaired. Therefore, | | | | future claim will result. |
| when insurers see a previous water damage | | | | |
| claim, they are apt to not decline coverage | | | | Finally, buyers should begin shopping for |
| or cancel your policy within the first 60 | | | | homeowners insurance immediately after |
| days grace period for the insurer even | | | | signing the purchase contract. Not only is it |
| though the claims happened before you owned | | | | required to be in place at closing by homes |
| the homes for sale. | | | | for sale lenders, but also there always is |
| | | | the chance you may be rejected by the first |
| Water damage is only one of many damage | | | | chosen insurer and will need time to find |
| claims insurers look for when underwriting | | | | another insurer. |
| your potential homes for sale. They will | | | | |
| evaluate all of the homes for sale claims | | | | So, discuss with your realtor a contingency |
| history to determine if the potential homes | | | | clause in any offer you make for a homes for |
| for sale is a disaster just waiting to | | | | sale before he/she begins showing you homes, |
| happen. | | | | and plan to begin looking for an insurer |
| | | | immediately after signing the purchase |
| Since current homeowners have a motive to | | | | contract. |