In recent news, we’ve heard unsettling stories about homeowners losing fully paid-off properties over something as small as an unpaid utility bill. While it might sound shocking, Florida homeowners face similar risks. Even if your mortgage is fully paid, certain unpaid bills can lead to liens, which in turn might result in foreclosure proceedings.

Currently, Florida’s foreclosure rate is one of the highest in the nation, with about one in every 267 homes facing some kind of foreclosure action. This makes it crucial for homeowners to stay vigilant about all financial obligations tied to their property. Yes, even the smaller ones like water bills or homeowners’ association fees.

So, what can you do to protect your home? First, make sure you’re regularly checking for any outstanding balances on utilities or association dues. Setting up automatic alerts or calendar reminders can help. If you’re unsure, consider speaking with a local advisor who understands Florida property laws and can give you a checklist to stay on top of these details. What I personally like to do is check my county records to make sure any liens listed on my property are ones that I’m aware of.

Another option is consider having a cash value life insurance policy. These policies allow you to build up cash value over time, which you can borrow against in a pinch. If a surprise bill or lien ever threatens your property, having access to immediate cash from your policy can be a lifesaver. It’s a way to give yourself a financial safety net without having to rely on traditional loans or scrambling for funds.

Here are four reasons why having a cash value policy stands out compared to a traditional home equity line of credit (HELOC):

1. No Risk of Foreclosure: With a HELOC, your home is used as collateral. If you can’t make the payments, there’s a risk of foreclosure. A cash value policy, on the other hand, isn’t tied to your property. You can borrow against it without putting your home on the line, giving you peace of mind.

2. Flexible Access to Funds: Cash value builds up over time and can be accessed whenever you need it, often with fewer restrictions than a HELOC. You won’t have to go through a lengthy approval process each time you need funds. It’s like having a ready reserve that’s available on your terms.

3. Potential Tax Advantages: Loans taken against a cash value policy are typically not considered taxable income. This can be a tax-friendly way to manage unexpected costs without adding to your tax bill, whereas HELOC interest may have different tax implications.

4. Consistent Growth and Protection: While a HELOC depends on your home’s market value and can be affected by housing market fluctuations, a cash value policy grows steadily over time. It offers a combination of protection and growth, giving you a stable financial cushion regardless of what the real estate market is doing.

In short, staying informed and having a backup financial resource like a cash value policy can help you keep your home truly secure, no matter what surprises come your way.