Real Estate Agent · Chicago, IL · Member since 2020 · 25 posts · 16 votes
Hi everyone, Happy Thanksgiving!
Im currently in the process of closing my first multi-unit deal in Chicago and could use some insights on getting a home insurance quote.
This is a FHA 203K project and I'll be renovating the building for the first 2-3 months before renting it out. The rehab includes; interior and exterior painting, trim work, full kitchen, full bathroom, replacing flooring, recessed lighting and adding AC/condenser.
No major structural repairs, roof or furnace.
Im looking to get a quote on insurance and I've researched that I should consider getting a renovation/builders risk policy.
What are some key things I should consider and pay attention to when it comes to picking out a policy?
I got a quote from an agent; Home insurance policy is $1900/year which is reasonable but I was told by the agent that i should also consider a builders risk policy for the months its being renovated and then switch over to the regular policy. The policy is coming out to $6000/year which is $500/month for 2-3 months of renovation work.
Don’t muck around with insurance. In the end it’s just not worth taking the risk. During your renovation you want not only builders risk but you want vacant dwelling insurance. The problem I found with many companies is they charge you basically for a full year even if you don’t use those things for the full year. So shop around
Congrats! I did a hud203k and have been house hacking there for the past 2 years. I love the loan product and getting clear to close is the hardest part so you’re done with the hard part!
I agree with Marilyn- I went through an agent with mine. And I got the builders risk for the renovation portion like she said. Remember you won’t be in the renovation phase for too long so if you already got quotes for home owners I’d go with your best offer there and work with the agent to get the right coverage. Have them walk you through the types of covered loss and what your deductible would be. Your escrow payment might be weird for the first year or so but you will get reimbursed if you pay in too much