Why Do Banks Require Homeowners Insurance?

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   Ted Ratliff

   Owner, SFS Associates,

   Banks require homeowners insurance to protect themselves.  When you have a mortgage on a home, the bank becomes part owner of that home.  If it burns in a fire or is destroyed or damaged by a catastrophic occurrence it needs to be rebuilt or repaired.  Home Owners insurance allows for this to be done..

   Answered on May 26, 2013

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