All Forum Posts by: Account Closed

 Be careful about overtly denying a Section 8 applicant. Many States have laws prohibiting discriminating based on an applicant source of income. In most cases a section 8 tenant will not meet your 3x income requirement or credit score requirement anyway so you can deny these tenants without mentioning section 8. 

I would start by explaining to the tenant this his/her property is not covered by your insurance if it is damaged and recommending the tenant pay the $100-$200 a year for this coverage. If the tenant still refuses to purchase renters insurance I would recommend just purchasing the insurance for the tenant yourself. If your tenants property is damaged and no renters insurance is in place it is very likely you will be sued and the first hour of legal fees will exceed the cost of renters insurance. Renters insurance also gives the tenant liability insurance which provides primary coverage if someone is injured in the unit decreasing the chance your policy will be effected. 

In many cases the multipolicy discount that comes with combining renters and auto insurance totally covers the cost of the renters policy. 

Common renters policies will cover this. The defect exclusion pertains to defects in construction or products you actually build or manufacture and nothing to do with an unrelated product defect. 

Generally when a tenant damages his or her unit the owners property insurance generally pays the initial cost of the damage. Prompt payment is the reason the owner has property insurance. The owners insurance company can and often will try to collect from your insurance company for the damages. In this scenario the owners insurance company will be dealing with your insurance company directly 

Owen, 

I total agree with you regarding the importance of a local agent. This seems to be a minority opinion on these forums. I typically quote around 10 properties a week. For each property I  generally get a quote from three carriers. This gives me a feel for the pricing and coverage trends in my area that a national agent could never replicate. Pricing varies significantly by region and insurance companies underwriting practices and appetite vary by region. It is impossible to be in tune with every market. For example, in some regions a wind hail deductible of 5% is common while in others a flat $1,000 deductible is still prevalent. 

National Real Estate Insurance Group is basically a surplus lines broker that has marketed themselves a rehab insurance agency.  They mention Acceptance Indemnity, Lloyds and Ironshore on their website which are all carriers your local wholesaler has access to. Using surplus lines carriers allows them to be flexible regarding property valuations and reporting forms but this flexibility comes at a price. As you mentioned these companies can do funky things like provide basic perils coverage. 

This is the page at the beginning of an insurance policy that lists the limits of insurance, deductibles, etc. Here is a link to an example i found on google images. Declarations Page

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In the St. Louis area local banks lend at a 80/20 ratio all day assuming they like the credit and the buyer has strong financials. I have heard of 7 year fixed or floating rate loans and obviously be prepared to personally guarantee the loan. I am also assuming the property already has high occupancy, you have experience, good cash flow, etc. 

@Bruce Ellerd Generally if you put less than 20% down the lender requires you to prepay your property insurance at closing and then make monthly deposits as part of your mortgage payments that go toward paying for the next years insurance. However, you have the option to select a different carrier on the renewal date as long as you notify your carrier.  

@Kevin Scanlon If the values are that out of whack the first thing I would do is contact the insurance company and make sure there wasn't a mistake. If that is the case Utica should issue an endorsement and refund any overpaid premium. 

Your agent should probably have gotten multiple quotes for the property which likely would have brought this error to light so I would bot hesitate to push him for a solution. If he has a good relationship with Utica they should allow you to cancel and find new insurance without a fee assuming they will not reduce the value. On another note, YIKES premiums are much higher on the coast than they are here in the hinterland. 

Texas is one of many states that require your Association's master policy to insure the interior of the units if you are in a multi level building. However, the master policy does not have to include improvements or betterments within the units. For practical purposes this means any upgrades you do to your unit above the most basic features (vinyl and carpeted floor, discount appliances, etc.) must be insured by your condominium unit owners policy. The cost per square ft to replace your current unit x square feet of unit - cost per square ft to replace with basic unit x sq ft of unit = property limit.

Also be sure to check your master policy deductible as you are responsible to pay up to the master policy deductible for damage just to your unit. Your unit owners policy can cover this amount along with your share of the earthquake deductible. Also be sure to get a dwelling fire policy meant for renters and not a traditional policy meant for someone using the condo as their primary residence.