Potential 1st Time Landlords

6 Replies

We may more than likely be coming into our first rental properties. Two condos both free and clear, one has a tenant already in it with a guaranteed rental payment made by a well known charitable organization. The second unit has the potential for another tenant placed by the same organization. Two free and clear properties with guaranteed cash flow. My question is do we get two umbrella policies for maximum protection or does one policy cover both units?

One umbrella policy. Coverage of no less than one million. The umbrella policy covers your liability, not tied to only one property. However you need appropriate policies for each property (ie. landlord, dwelling, fire policy, etc.), and your home (homeowners), and your auto (automobile), before you can purchase the umbrella policy. Contact an insurance broker who works with a wide variety of insurance companies for a better chance of finding a good match for you and your situation.

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Hi Derick and Lisa, 

I'm sorry to say I don't know the answer to your question but I have a question for you. If the rental payments are being made by a charitable organization, do the tenants pay anything?  If they pay nothing for the property they are more likely to not take good care of it.   For example I have a friend who owned an apt building.  She rented to a relative.  That person never bothered to buy a shower curtain.  It caused thousands in damages.  If a relative is capable of doing that....

I'm not trying to dissuade you, just trying to help make sure you've covered every base.  

Debra

@ Marcia Maynard thanks for the information, we'll certainly speak to someone.

Thanks Debra, the current tenant does not pay anything but takes impeccable care of the unit. The second we'll see but the screening process will produce a similar result.

@Derick & Lisa Pope WOW - what a blessing to have two free and clear ones! Good for you!

@Derick & Lisa Pope  Check with the charitable organization on the term or commitment with the free rent.  I had the plug pulled on one of my tenants with no notice.  It sounds like a good tenant but I have better luck with section 8.

Frank 

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