Buying a Home in a Fire Risk Area: Here's What You Need to Know
Outside of
the significant financial responsibility of delving into home ownership, there
can be some other risks involved which you may not have thought about as a new
homeowner. While the requirement of homeowner's insurance is well known, if you
happen to be living in an area that's at high risk of fire, here are some
things to consider beforehand.
Defining High Risk
Whether you
love an area or it's relatively unfamiliar, it's easy to be swept away by a
home and forget about what the natural landscape can entail. However, many
homes across the United States are built in areas close to trees and shrubs,
which can be dangerous in times of high temperatures and low moisture, so it's
important to do your research.
Your Realtor
should be able to provide you with information regarding how the area is
designated in terms of fire. If you decide to shop homes in high risk zones, a
great resource to educate yourself is Firewise USA, Residents Reducing WildfireRisks. You’ll find lots of information and tips on
their website, like looking for homes built with fire-resistant construction,
such as brick, cement, plaster, stucco, and concrete.
What It Means For Your Mortgage
There are
many homes that can be adversely affected by a fire so it's important to
realize that buying in a high-risk area will not impact your ability to get a
mortgage. It can, however, impact some of the costs associated with investing
in your home. While homeowner's insurance is a requirement of buying a home and
it will generally cover you in the incidence of a fire, it can cost a little
more in high risk areas. It’s possible you may be able to guard against some of
the additional costs by following the guidelines set forth by the above
mentioned, Firewise USA, Residents Reducing Wildfire Risks.
In The Event Of Fire
If the worst
happens and your home incurs damage from a fire, you'll want to assess the
extent of the damage before making a decision. For a home which has been
minimally impacted, you may want to use insurance to repair the property.
However, if the property is completely leveled, a payout may be required to pay
off the mortgage. It's advisable, before purchasing a home in a fire-prone area,
to be very familiar with your insurance policy so you are prepared.
It's higher
risk to buy a home in a fire-prone area, but you can be prepared for the worst
by doing your research up front and knowing your options.
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