Trouble getting homeowners insurance

[Heidi-Marie Jones]

I am looking at a property that is 20 hours from me and is a very low cost to purchase. This low cost allows me to put a 5% down payment which is all I have saved so far, and I can carry the mortgage myself while I pay rent where I currently live. To get lending I need homeowners insurance but to get the homeowners insurance it first needs new wiring and a roof. I don't have the money to do this now and was told it might be something I can put in the condition of the sale for the current owners to do. It is an estate house being sold by family members. My intention with this property is to do basic renovations and cleanup over the next year resulting in a BRRR over a 2 year span. Are there any options I am unaware of that could help me make this deal go through? Or should I just leave this one alone? This would be my first property.

[John Mocker]

Heidi-marie,

Although you may not be able to get coverage from a standard Homeowners policy until the wiring and roof are done, there may be a Non-Standard (aka Excess or Surplus) policy that will be able to cover it until you complete the work.  The other option, if it will not be occupied until the work is done, would be a renovation Builders Risk policy.  For that policy, it would probably have to be a quicker rehab.

I would suggest contacting several Independent Agents (represent multiple companies).  Agents that do commercial Insurance in the Construction area may be a good starting point.  See what they can do to get you through this period.