Owning a home in the Golden State is not without its potential hazards to be aware of before you buy. For home sellers in California, the Natural Hazard Disclosure Report (NHD) is a time-honored annoyance. Every seller in California must prepare one for the sale to close. If you’re thinking of listing your home, let’s get familiar with the report so there’s no surprises. The Natural Hazard Disclosure Report is a report required by the state that discloses whether or not the property in question is at risk for a laundry list of natural hazards. It consists of the aggregation of several othe...

The ground shakes under Americans’ feet an average of 20,000 times every year. Most of the time, the seismic vibration is so slight that we don’t even feel it.  But those rare major earthquakes — in addition to being hazardous to life and limb — are capable of causing catastrophic damage to your home and the property inside of it. Worst of all, much of that damage won’t be covered by standard insurance policies.  Fortunately, there’s something out there called earthquake insurance. But is it worth it? What is earthquake insurance, and how do you know if you really need it? What Is Earthq...

When you buy a home, it can sometimes seem like the inspections never end. The home inspection, the title inspection, the appraisal, possibly a survey … it may feel like your prospective home has been poked and prodded to death. And you along with it. Then, as if it weren’t enough, your lender comes back with a request for flood certification. What are they asking for, and why? What Is Flood Certification? Flood certification is official documentation of the flood risk status of a piece of real estate, presented on a Standard Flood Hazard Determination Form (SFHDF) promulgated by the Fed...

“Why do I need flood insurance?” The short answer is — you may not need it, but it’s almost always wise to consider it.  The main reason most people end up getting flood insurance is because their mortgage lender requires it. Why will a mortgage lender require it? To protect the collateral for the loan — i.e. the property. If a house is severely damaged by floodwater and there’s no insurance to cover it, it may suffer a catastrophic loss of resale value and require tens of thousands, even hundreds of thousands of dollars to repair.   For the homeowner, the most financially sound move may...

Just what you need as a homeowner … another bill. But it’s far better than having to pay out of pocket for flood damage. Restoring a home after a flood can cost anywhere from the thousands to the tens of thousands. Many homeowners think their homeowner’s policy covers them in the event of flooding, but it only protects them if the water enters from above. For example, stormwater from a compromised roof.  If water enters from the ground — storm runoff, overflooded river banks, etc. —  homeowner policies do not cover damages.  So how big a bite are we talking about? How much can you expect...

Depending on who you ask, Mello-Roos is one of two things … 1) an important tool California communities can use to serve their residents better, or 2) an unwanted tax that you have to pay but your friends across town don’t. However you feel about it, it’s important for California property-buyers to understand what Mello-Roos is, whether or not it applies to you, and what to expect if it does. What is the Mello-Roos Community Facilities Act of 1982? In 1978 California voters passed Proposition 13, which amended the California constitution to lower property taxes and cap annual property ta...

While Californians enjoy temperate and sunny weather throughout the year, it’s also an area of the country that faces a constant carousel of natural threats. Earthquakes and floods are frequent visitors, and more recently, wildfires have become pressing issues residents must consider when purchasing a home. In 2020 alone experts estimate that wildfires in California cost residents upwards of $10 billion in damage. The financial cost is severe, but when one considers the loss of life and natural habits, the grim reality sets in about their capacity for destruction.

Luckily, it’s a st...

Known for its beautiful mountainous landscape, sunny beaches, and widespread entertainment, California remains one of the most popular locations in the U.S. for new homebuyers.  However, California is also known for its highly unpredictable weather — from wildfires to flooding, homebuyers must constantly be on their toes to keep up with the legal demands of such an environment.  That’s where a Natural Hazard Disclosure (NHD report) comes in handy. According to California Civil Code, real estate agents and brokers must provide prospective homebuyers with an NHD report if the property is lo...

Many homeowners mistakenly think that their homeowner’s insurance policy will cover them if water enters their home or other structure on their property.  That’s only half-true. Homeowner’s insurance policies usually only cover damage from water that enters from above or within (i.e. rainwater that enters through a broken roof, or a pipe breaking) … but it doesn’t cover water that enters from ground level — runoff, bad drainage, surface water, burst water mains, or overflowing rivers and canals.  For this kind of damage, you need separate insurance — flood insurance. Your mortgage lender ...

Flood certification is a necessary processing step for nearly every mortgage. It determines whether or not the mortgage lender will require the borrower to purchase and maintain flood insurance before funding the loan.  Damage due to flooding is not covered by most homeowner policies, and even a few inches of floodwater can cause catastrophic damage to the structure of the property—in other words, to the value of the collateral for the loan. Lenders do not want to be stuck taking back a property that has been rendered almost worthless due to flood damage.  That being said, flood certifica...