Buying As-Is Short Sale: Needs Roof, can't find insurance

[Victor Morgan]

I've been reading these forums for several months and would like to thank the members for sharing their expertise. I have learned a great deal about real-estate investing and operating a rental.

The home I am currently purchasing as my main residence is an as-is short-sale at below market value including repairs. Although there are many minor repair items, the house either needs significant roof patching or replacement. I have factored the repair costs into the price offer and am planning on paying out of pocket immediately after closing, but have hit an unforeseen snag.

The mortgage company requires insurance, but no major insurance company that I have called will insure a house that needs a new roof, even if it replaced ASAP after closing with funds from the new owner.

I'm sure that I'm not the first person that this has happened to, what good options do I have?

Are there any "temporary" insurance companies that would bridge the gap between closing and the completed repairs (~30-60 days)?

Could the current owner file insurance and take funds from the escrow account to pay the deductible?

Are there insurance companies out there who do this that I just haven't found yet?

or am I just being to honest with the insurance companies because when they send an inspector I will have already repaired/replaced the roof?

[Glenn McCrorey]

Victor, can you get a roofing contractor to put in writing the roof has a few years left on it? You could plead ignorance to the insurance company because you aren't a roofing guy and it didn't look perfect but then you so you got a professional opinion and learned you were wrong about how bad the roof is (assuming you can do so truthfully). I like Jeremy's comment about an "exclusion" if the above doesn't work. I bought a house last year with a bad roof. The bank held the repair funds in escrow until the job was completed then paid the contractor directly. I don't remember the insurance company asking about the roof but I use the same agent for all these deals so they don't ask as many questions.