Insurance for a Rental Home

We bought a home 16 months ago as our primary residence and have a mortgage we pay each month. We moved all our belongings there, got a security system, but in the end, we did not move in. Instead, we decided to rent a home closer to our workplace. Now, we think we've found someone who would like to rent our house. However, we're concerned about how to get the proper insurance and what might happen if the bank finds out it's not our primary residence.

Answer:

You absolutely have to declare that it is not your primary residence, and get the right insurance as a landlord. Otherwise, if anything happens to your house, you will not have insurance coverage.

As for the bank, I suspect that you won't have a problem if you have been regular with your mortgage payments. Just be sure that you have the right insurance coverage -- if anything would make the bank edgy, it would be a property that doesn't have insurance to properly cover it. After all, they are banking (pun intended) on your asset, and if that asset is at risk, so is their loan to you.

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