Consumers Using Payday Loans to Fund Vacant Home Insurance

The Real Estate Market is Creating More Problems

Think it's OK to leave your property vacant when it's up for sale? Not a good idea. Use payday loans if necessary, but pay to get vacant home insurance!

Think it's OK to leave your property vacant when it's up for sale? Not a good idea. Use payday loans if necessary, but pay to get vacant home insurance!

Payday loans are proving their worth in the sluggish Real Estate market. Today homes are taking longer than ever to sell. It is not uncommon to put your home for sale in April, the prime month for sales, and still be waiting on a qualified buyer in September. The housing market has suffered greatly since the recession and many people either don’t have the funds to buy a house or don’t qualify for a loan.

When a homeowner has to keep a home on the market, sometimes they are forced to move and leave the sale property vacant. This creates a problem for homeowners because vacant houses are known as “nuisances in neighborhoods and they are temptations for vandals and thieves,” according to Michael McRaith, director of Chicago’s Department of Insurance.

Insurance and the Vacant Home

It is a fact that insurance providers do not like vacant homes. Homeowners are finding out the hard way that if their property is not inhabited, it could be dropped from homeowner’s policy coverage. Empty homes are known as riskier to insure. Peter Moraga, spokesman for the Insurance Information Network of California, said, “Kids climbing over a dilapidated fence could get hurt, or teens partying in a vacant home could fall and slip.” Such issues could make empty homes a huge hazard for homeowner insurers.

Solutions for Vacant Properties

For anyone who foresees a vacant home in their future, there are options. People who need to insure their vacant homes normally have two choices: They can either buy an endorsement to their existing homeowner’s insurance policy or try buying separate vacant-home insurance.

The most convenient option is for a customer to use an endorsement to their existing policy. State Farm Insurance offers these endorsements and they normally cost less than $100 to add to an existing policy. If a homeowner needs to, they can fund the additional cost with small payday loans, savings or a credit card. It’s a much simpler solution than doing nothing and it is much more cost effective than not having insurance if a disaster occurs.

There is also the option to buy separate vacant-home insurance. This option is not available through every insurance agency and customers may have to look around to find it. The easiest way is to ask your current insurance agent for recommendations.

Vacant-Property Owners Shouldn’t Ignore the Issue

The single worst thing that can be done, however, is to ignore the issue. Many policies don’t announce their rules regarding vacancies, but if an issue arises they will rely on it. Moraga confirms that “Most policies have exclusions for ‘neglect’ or ‘abandonment of property.’ If a homeowner is not living in the home and does not notify their insurance agent that the home is sitting vacant, any claim for property damage or liability under the homeowner’s insurance policy could be excluded or constitute insurance fraud.”

Better Safe Than Sorry with Insurance

The best option is to protect yourself. If you have a property that will be sitting vacant, call your insurance agent and ask them what the best option for you is. It’s better to use savings, small payday loans or a credit card to fund a fee than to have a much larger liability on your hands if something happens at your vacant property.

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