Homeowner’s Insurance- GFE

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    We have an applicant purchasing a condo. The applicant’s HOA fees cover their “homeowner’s insurance.” With this in mind, would it be sufficient to put zero in for the homeowner’s insurance amount on the GFE. I understand homeowner’s insurance can change by any amount between the GFE and HUD settlement statement.I’m having trouble finding some guidance to back me up. Has anyone run into this situation before? Thanks for the help.


    I looked through HUD’s RESPA FAQ’s and the RESPA RoundUps and I can’t find anything that addresses this situation. Perhaps it is not specifically addressed.


    Make sure you obtain the policy and read it thoroughly. These policies generally only cover the “shell”. Some finishes which normal homeowners policies cover won’t be covered (granite countertops, marble tubs, tile showers, hardwood flooring, etc.). This type of insurance is problematic when trying to obtain renewals. You are basically at the mercy of the person running the homeowners association.

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