All Forum Posts by: JonPaul Kessinger
JonPaul Kessinger has started 19 posts and replied 52 times.
Post: How to estimate ARV in small town with few comps
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Does anyone have any suggestions on how to estimate ARV on a single-family home in an area where not many homes are being sold and the ones that are would not be good comps? I live in southern WV, the city is Mount Hope, right outside Beckley. I have a property I am wanting to BRRRR, I can get it at a decent price, have contractors working on quotes but not sure how to guess the ARV. The house is 1900 Sqft, 4 bed 1 bath.
Post: Property not worth Rebuild cost
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Quote from @Jason Bott:
@JonPaul Kessinger there are policies out there that will insure it for $150k on an ACV policy. It may not work if your lender needs to have a Replacement cost policy to close the loan.
You will need to get an Agreed Value policy to avoid being penalized for being underinsured.
If you do not get the Agreed Value endorsement and you have 80% coinsurance (sounds like that what has been quoted), the policy can penalize you proportionally for being underinsured. Example - If the policy is written for $150k, and the rebuild cost is $450k, they can turn around and say you were only insuring 33.33% of the building, therefor we are only paying 33.33% of the claim. With a $100k kitchen fire claim, they may only give you $33k.
*Please note this is a simplified explanation and each policy can be written differently.
Thanks for the information, I spoke with my lender and they told me I just had to have it insured at the cost of the loan.
Post: Property not worth Rebuild cost
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Post: Property not worth Rebuild cost
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Quote from @Kevin Koone:
This happens a lot in areas where real estate prices are low but the cost to rebuild the home b/c of square footage, # of bathrooms, etc would cost a lot more to rebuild than you could buy the same house down the street. There are ACV(Actual Cash Value) policies out there but keep in mind the only way you're going to get paid on them is basically if it was a total loss. I also find that these policies generally cost about the same as a Replacement Cost policy does when it comes down to it!
Good luck!
Thanks for the info, that is my situation. I live in southern WV where realestate is cheap, which is helpful when you need a 20% down payment
Post: [Calc Review] Help me analyze this deal
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
*This link comes directly from our calculators, based on information input by the member who posted.
This is in southern WV, a pocket listing from an older lady in my comunity. What are your thoughts?
Post: Property not worth Rebuild cost
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Post: Property not worth Rebuild cost
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
I am looking to purchase a large home in my small community. Most insurance companies are wanting to insure it at a minimum of 80% of the rebuild cost. The home is only worth 150k once fixed up but would cost close to 450k to rebuild. Do you guys have any advice on trying to insure it at 150k? If it was to burn down and be a total loss I would not build on the lot and deploy the payout into another property. Any suggestions where I could find Landlord insurance that would allow me to insure it for the 150K? Side not I am buying the property for 55K from a pocket listing.
Post: How much personal liability should I carry?
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
What amount in personal liability insurance should I carry on each of my properties?
Post: Cost of Land Lord insurance
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
Quote from @Jason Bott:
@JonPaul Kessinger That price does seem a little high for the amount of insurance you are getting, but it's hard to tell without knowing all of the details. Best thing to do is find a broker who can shop some different options for you.
For reference, the price of insurance is based on many things, but market value is not one of them. Here are some of the main determining factors:
* sq/ft of the building to determine how much it would cost to rebuild
* location - How far from the fire station
* crime score
The house is about 1800 SQFT and is only 1.5 miles from the fire dept, I'm not sure about the crime score but it is located in a very small town that doesn't have much crime ( I live in the town and work for the Fire Dept). My wifi has USAA and I think we are going to get a quote from them because I was told that they have a much cheaper.
Post: Cost of Land Lord insurance
- Property Manager
- Bridgeport WV
- Posts 52
- Votes 17
I am working on my first property and it's a pocket listing. I have the lawyers creating a purchase agreement, I have financing in line and I am working on getting my Landlord insurance. I was just quoted $130 a month for it. From my understanding that's way too high right? I'm purchasing the home for 55k and I would guess it would only appraise for 70k max. Any advice on how to get a lower rate but not get an awful policy?
Thanks!