When you’re trying to determine whether or not you can afford to make a certain investment or buy something, it’s important to look at the worst case scenario of what could happen if things don’t go well.
For example, let’s take buying an investment property as an example; if you decide that the potential return on investment isn’t worth the risk of investing in that property,
then you’ll need to know what disasters could occur from this purchase and prepare yourself accordingly.
Here are 6 Property Related Disasters That Can Ruin You
1) Not buying insurance
The first property related disaster that can ruin you is not buying insurance. If your house burns down, if there’s an earthquake in your area,
or if someone slips on the ice and falls into your home, you’ll be responsible for paying for the damages.
And if you can’t pay for them, that’s when you could lose everything you’ve worked so hard to build.
Always read the fine print because some insurance companies have clauses that might prevent you from getting help after certain disasters happen.
Don’t think of it as just a number: Your credit score isn’t just a number – it can affect whether or not lenders will give you loans, how much they will charge, and even which homes will be available to purchase.
A low credit score might mean higher interest rates and more strict qualifications.
Find out where you stand by checking your three major credit scores with Credit Karma; it’s free and no strings attached!
2) Not being familiar with your policy
If you are not familiar with your policy and what it covers, you might find that the damages of a disaster could be your own fault.
For example, if you don’t read your policy and find out that water damage is not covered by your insurance company, then the water damage to your home will have to be paid for with personal funds.
You may also think that smoke damage to the interior of your house is covered, but this coverage often only includes repairs in cases where the fire started on your property.
Make sure you review all of these important details before disaster strikes! Be aware that some disasters are not covered by standard policies including: floods, earthquakes, war risks or terrorism.
The value of items inside homes varies from one homeowner to another. You may be able to save things like clothes, books and electronics while others cannot.
Be honest about how much time and money you want to spend on salvaging your belongings, as well as how much money you’re willing to spend on temporary housing arrangements during repairs.
3) Lying on your insurance application
In order to protect your home from damages, you can purchase insurance. If you lie on your insurance application, you will not be protected.
It is important to be honest with your insurance company so that they can provide the best coverage for your situation.
If you are found guilty of lying on your application, it could lead to a hefty fine and jail time. Insurance fraud is a serious offense that should not be taken lightly.
Insurance fraud is when someone knowingly lies about their possessions in order to get a larger sum of money for their claim.
Examples include exaggerating how much jewelry was lost or overstating the cost of repairs needed in order to make an already costly issue seem worse than it actually was.
The potential consequences include paying back any money obtained from the fraudulent act, restitution charges, fines and prison sentences.
4) Making a claim for a frivolous reason
A lot of people think that owning a home is the American dream, but what they don’t know is that in some cases, it can be the American nightmare.
Especially if you’re not ready for these disasters. other people to get back on your feet again.
Just like any other disaster, a property related one needs to be dealt with quickly and efficiently before it spreads out of control.
For example, water damage should be cleaned up right away because mold will start to grow within 24 hours of exposure.
Taking care of things immediately also gives you time to make an insurance claim without having to jump through hoops later down the road which will save everyone time and money.
5) Failing to disclose all relevant information
It is important to disclose all relevant information, even if it seems irrelevant.
For example, what if you were purchasing a property and failed to mention that the basement was prone to flooding?
This might seem like an inconsequential detail but it could end up costing you thousands of dollars in damages.
The seller or their agent should provide detailed disclosures about any known issues with the property.
Failure to do so can lead to legal action. If there are hidden problems with your home and during construction workers cut into an underground utility line which ends up causing $10,000 worth of damage.
6) Not shopping around for the best policy
When it comes to insurance, shopping around is key. There are many factors that go into determining the price of an insurance policy,
which means you may find that a policy that’s $5,000 less expensive in one area could be more than $30,000 cheaper in another.
For example, if you’re shopping for auto insurance and live in a rural area with little traffic (fewer accidents),
your rate could be significantly lower than somebody living near a major city with heavy traffic.
A company will typically charge higher rates for areas where there is a greater risk of something happening.
By looking at different companies’ policies and comparing their prices, you can save up to 50%.
However, some insurers only offer these types of plans in certain states or through certain brokers so you’ll need to do some research before settling on this type of plan.