Owner occupy/Uninsurable house - Insurance & Finance Questions

[Sonia T.]

 Hello,

Hopefully so me of the experienced BP members can help me.

Scenario: buy house for owner occupy. Inspection report indicates major deferred maintenance issues. Sellers motivated, not much equity, and not short sale/foreclosure. 

Regular run of the mill home insurance will NOT insure in its current state. The repairs need to be fixed before closing - not possible with sellers living there.

- is cash the only option to finance such a deal? 

- What kind of insurance can I get while rehabing? Vacant vs Living there (do rehab in stages). 

- Any experience on rehab loans and its interest rates? 

Thanks,

Sonia