Summer of 2015 we had a listing where the water line broke on the toilet.

This flooded the entire downstairs destroying all the drywall and flooring.

The damage had to be cut out, home dried out, and remodeled costing many thousands of dollars.

Our client was an emotional wreck, she could not afford the repair AND the mortgage.

Luckily her insurance stepped in and paid for the repairs. She was able to sell the home and go on with her life.

Otherwise she would have lost everything to the bank in foreclosure.

A couple years prior I found a home with a missing AC Compressor and additional vandalism.

The homeowners were in distress and had no money to complete repairs.

My client presented an offer with the request the seller repair the vandalism.

This of course was all handled by the owner’s insurance company and the home sold.

My client got a great deal and the sellers were able to move on with their life.

Both of these scenarios could have EASILY ended in the owners loosing their homes and any equity they had.

Call your insurance company

There are two things insurance companies typically will not cover on a vacant home. That is vandalism and water damage.

Both of these are some of the most frequent claims, however, the extent of damage is MUCH worse if the home is vacant.

We always advise our clients call their insurance company prior to listing their home even if they do not plan on vacating to ensure coverage remains consistent.

Request insurance claims history

While you are on the phone with your insurance agent make sure to request a 5+ year insurance claim history (or for as long as you have owned the home).

Delivery of this document is required by the Arizona Association of Realtors Purchase Contract we use.

Claims history is a part of the new owners ability to obtain insurance on your home so you may want to take this into consideration if you have any small claims you were considering filing.

Once you get the report share it with your agent prior to listing your home.

Take appropriate precautions

There are a couple simple tips to help protect you should your insurance company not protect you against plumbing or vandalism

1. Turn off your pluming system this is frequently referred to as winterizing your home. You can hire a specialist to do it for you. Many times all you need to do trace your water main to the side of the house and turn off the valve closest the wall. When you do this you will also have to turn off your hot water heater to avoid it trying to heat an empty tank. Then open a couple faucets in the house to release the pressure. Periodically somebody will need to return and fill back up dried sewer traps.
2. Put together a theft deterrent system this may be as simple as a light and radio on timer switch. Have them go on at night to make the home appear occupied. You may also want to have a trusted neighbor park in front of your home to make it appear occupied. Then have them checkup on the property periodically.

These certainly aren’t foolproof however, they will greatly reduce your risk should the insurance company not completely cover you.

Contact your homeowners association

If you live in a homeowners association aka HOA there are two more pieces of paper you will need to obtain from them before listing your home.

1. Request the HOA info form from your agent. It provides information on shared resources in the community. Basically what the new owner will get for purchasing in your community.
2. We typically also collect the HOA info sheet. This form discloses what the fees are for buying into and owning in your community. Buyers have to have this information to structure a deal. Without it they have no way to present you an offer.

Provide this information to your agent prior to listing your home.

Any CC&R violations?

While you are on the phone with your HOA rep, ask if you have any outstanding HOA violations. Are your bills up to date and are you in good standing with the HOA?

It is VITAL you ask this BEFORE you list your home. Once you list your home and have an offer you have ZERO leverage to negotiate with the HOA.

If you do, simply make note of them and kindly thank them for letting you know. You still have to fulfill your obligations however, if you are closer to closing out a sale on your home you will have no room to work with them. This WILL cost your more time money and grief than just understand up front what violations you may or may not have made.

I had a lady get HOA legal fees removed, assistance reverting architectural violations, and more doing this. It saved hundreds of dollars when if she had ignored it would have lost her the home. Instead we closed out her transaction and she net in excess of $60,000.

Most of the time this story goes the other way though. I have seen quite a few homes on the market that have been LOST due to people not working with their HOA and ignoring violations.

If you have outstanding violations make your Real Estate agent aware of them so they can work with you and the HOA to sort them out.

What you need to do now

Step 1: Call your homeowners insurance company

1. Request a 5+ yr (or as long as you’ve owned) insurance claims history.
2. Ask what if any effect will listing your home have on your coverage. Let them know if you plan on vacating your home during the listing period.
3. Take necessary precautions to protect your home.

Step 2: Call your HOA (if you live in a Homeowners association)

1. Request page one of HOA Addendum be filled out disclosing HOA fees.
2. Request a completed copy of the HOA information worksheet.
3. Ask if you have any outstanding HOA violations request an itemized list and contact info as applicable.

Provide the Insurance Claims History Report to your agent when you list your home. Also provide completed copies of the HOA Information and HOA Addendum if you live in a Homeowners association.