Trying to buy a house and take early possession.

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Mar 12, 2013

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Insurance Question from Norfolk, VA

Asked on 03/12/2013

Trying to buy a house and take early possession. I am trying to buy a house but I want to take early possession of the house so that I can live in the house until it closes. The seller is requesting I get homeowner's insurance that names them as the loss payee or lien holder for the period of time until the house closes and I am the owner. Is this type of clause possible to get? And if so, does it cost me more money accomplish this?

Answer given on March 25, 2013

If you are buying a home and want to take possession before the closing you need to work with the seller and their insurance company. If you purchase insurance on the home you will actually have no coverage, since you do not have an insurable interest in the home until the closing occurs. Even if you name them as loss payee there is still no insurable interest.Often times the insurance company for the current owner will allow the buyer to move into the home for a short period of time. There are clauses in the policy which cover temporary residents and boarders in the home. However, any personal property you put in the home may not be covered by the existing policy. You need to clarify this with the insurance company before moving in.The length of time you will be living in the home will have an effect on whether the insurance company will cover the home while you live there, so make it clear the time frame that is involved.

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