Pay for the foundation repair

Most homeowners' insurance policies exclude coverage for foundation repair. Only in cases where foundation movements have been caused by sudden and accidental discharge of water from plumbing system, is there a possible chance for coverage.

Homeowners should call insurance agents and ask about coverage for foundation repair, but more than likely insurance will not cover the repair costs. "They used to be covered until about 15 years ago," says Jeffrey Ellison, who has seven years of experience in foundation and construction repair. "Then the insurance companies changed the policy to where foundation repair was only covered if the foundation was caused by a leak under the slab. Then about three to four years ago, when all that mold hysteria started, they even eliminated the plumbing leak case and they have totally stopped paying for foundations."

Because insurance companies no longer assist homeowners with this big cost, homeowners are applying for home equity loans or home improvement loans to pay for the expensive costs. "When hiring a contractor to repair the foundation, the person may be able to assist homeowners in securing necessary financing, but it is very important to investigate where the money is coming from," says Ellison. Carefully compare the amounts, interest rates, terms, and tax consequences of each choice. According to Ellison, Federal Housing Administration loans may be available. Every homeowner should research, ask questions and find out important information before signing any contracts. The FHA does not guarantee work of any contractor, so make sure the person is a reliable contractor.

Before signing on with a contractor, have them inspect the home and give the homeowner an estimate. Estimates are free and it is logical to get several estimates from different contractors. Do not settle for the lowest estimate; rather see who provides better materials and better overall quality of the job. Typically, the lowest price means lower quality in products, which in turn will cause more stress and money later on when the foundation needs to be repaired again. When a contractor is picked, ask for references and any previous work history. Check out these references and find out if the homeowners were pleased with their work. Contact the Better Business Bureau and ask if they had any complaints filed by previous customers. Another important fact to find out is if the contractor has all necessary paperwork, licenses and insurance. If the repair work exceeds a certain amount, such as $30,000, necessary licensed is required. Three insurances must be checked and used by the contractor, says Ken Marlborough, ina an article on foundation repair contractors at ezinearticles.com. The contractor should have Workman's Compensation Insurance, Automobile Insurance and General Liability Insurance, which would compensate the homeowner if the contractor damages any part of the property.

Do not pay the contractor the full amount of services until the work is complete and the homeowner is satisfied with the work. Many situations can occur unforeseen, so every homeowner should be prepared to take necessary steps if destruction occurs.