Going from renting from buying can be difficult enough without having to worry about insurance. When you make a major purchase, you should always insure it, even for things that may not happen often.

Types of Insurance

PMI - For those people who do not put 20% down on their home, you will automatically get PMI. This is Private Mortgage Insurance which protects the lender if you default on the loan.

Homeowners - This cover just about anything that  can happen to or in your property. This type of policy covers the valuable in your home from fire, theft, and often wind and hail.  The insurance also covers injuries and accidents that happen on your property if you were to be sued.  If you keep valuables in your home - like jewelry - this is where you would cover those items.  The best type of insurance policy to carry will replace all your items at what you purchased them for, not the depreciated value.

Flood Insurance - This goes above and beyond homeowners. This policy covers you from water that rises, not from rain damage. With all the recent flooding, even those people who think they are safe from major flooding should purchase this policy. If you live in an area that has never flooded, this is a cheap policy to carry.

If you are a first time home buyer, the first thing you are going to have to think about is financing. Should you go through your bank? Through a credit union? What other options are available?

Loans:

The first place you should call is your bank. They will be able to tell you what they have to offer and today’s rates. Many banks will over you a reduced rate if you are a current customer and choose direct withdrawl for your payment.

Afterwards, call around. Call various banks and credit unions. Find out from the credit union if you get a reduced rate if you are a member.

Alternate places to get loans: HUD, Veterans Affairs (if you are a military veteran), or sometimes a personal loan.

Grants:

HUD - Meet with your local HUD office. Many HUD offices offer Grants to cover your PMI and a percentage of your down payment. These grants are not always financial need based.

Grants.gov - Excellent source for all government grants available for first time home buyers.

State grants - many states offer first time home owners grants. Most of these are to help pay towards your down payment to avoid PMI payments.

Remember, if it is a grant, you do not need to pay the funds back.

Your Realtor and your financing officer may or may not know about these options, so do your own research online.

If you listen to people in real estate, there is a time to buy and a time to sell. You buy when interest rates are low, sell when your home value is at its highest to get a good ROI. When is the best time for YOU to buy? This may not be determined by the market at all.

If you are not sure buying a home is for you consider the following:

1. Is buying cheaper than renting in your area? Include all costs like insurance, PMI. etc.
2. Are you okay with living in one place for more than 5 years?
3. Is your job secure?
4. Do you have enough money to put a down payment?
5. How is your credit score, debit to credit ratio? The higher your score the better the chance you will not only get the loan, but get a super low rate.

You think the above looks okay, your credit score is good and you are ready to move ahead. If not, here are some tips to get you to that point:

1. No savings? Open an account have have a portion of your income deposited into your savings account automatically.
2. Low credit score? Get a secure CD loan. You use your own money to secure the loan and only pay the interest. Pay paying the loan off in the amount of time listed, you will quickly raise your credit score.

Once you have most of the above done, meet with a personal banker. They will help you assess your current situation as well as tell you what loans they have available,. If you are first time home buyer or low income, there are grants available to help you make your first purchase.