All Forum Posts by: Bradley Sriro

Thanks for your response Nathan. The carrier that I have the open claim with is not the same as the one that denied writing a new policy. I will definitely be making some more calls though to other insurance agents to see what options are available.  

Thanks Jon, I appreciate your feedback. I am going to have to check with a couple of different agents because it doesn't make any sense to me. Just for clarification, the agent that I am working with in Jacksonville is new to me and the carrier that denied coverage is not the same carrier that I have the open claim with. But, the agent is saying that this will be the same with other carriers. In any case, I will definitely take your advice and seek out another agent. Thanks again! 

I am currently purchasing a turnkey rental from JWB in Jacksonville and just found out that when the agent went to bind the policy, the carrier declined coverage. In speaking with the insurance agent (Ricci Insurance), they explained that the reason for the policy denial was that I have an open claim on another rental property that I own in Miami-Dade County. I own several properties and as if 2020 wasn't bad enough with everything going on, I had to file an insurance claim for a roof leak/ water damage caused by a tropical storm. From what I am being told so far, if you have any open claims insurance companies will not write a new policy. The open claim has not been resolved yet and I do not know when it will be resolved as the claim is still being processed and I have a public adjuster working it for me. 

This is extremely frustrating because now I do not know if I am going to be able to close since it doesn't look like I will be able to insure the property. I am also very concerned with the $5,000 deposit that is non-refundable per the purchase and sales agreement that JWB uses. I must say that I have never experienced anything like this and it has definitely caught me off guard. I am kind of in limbo now until I can somehow obtain a policy. Has anyone else experienced this type of problem? If so, how were you able to solve it? Any insight or advice would be greatly appreciated!

@Misael Carlos Vera if you are interested in asset protection strategies, check out the book “Lawyers are Liars” by Mark Koehler.

@Franz Isak Bergmann Ingolfsson You may find this report created by the National Association of Realtors useful:

International Transactions in U.S. Residential Real Estate

This report is specific to Miami Florida:

Profile of International Homebuyers - Miami, Fl.

Florida ranks #1 out of the top 5 destinations for foreign buyers. The Miami Florida real estate marked in particular is actually one of the top destinations for foreign buyers. 72% Miami foreign buyers primarily reside abroad (compared to 39% nationally). 

What type of properties would you be interested in investing in? Single Family, Small Multi-Family, Condos, Apartments/Commercial? Your budget will ultimately determine which market may work best for you. I hope you find this information useful. If I can ever be of assistance, feel free to reach out. Good luck!

Wouldn't really say there is a #1 most useful tip... there are a lot of variables going on with a flip. You really have to do a great job vetting your contractors. A good or bad contractor can literally make or break a deal. Make sure to get legit references from people that have recently used them. Also, make sure that they are fully insured. Make sure that you have a builders risk policy on your flip as well. Finally, you have to literally stay on top of everything. You can't take a passive approach and expect others to do what is supposed to be done. While some people do what they are paid to do and what is expected of them, others don't... and if you are not around to see what's going on, that's where problems can occur and money can be lost. It is definitely a scary process but as long as you are actively involved, things will be a little less so. Oh and with regards to the contractors, after they have completed their job per contract and you have paid them, make sure to get a release of lien form from them. 

@Soniel Estime What a hell of a ride! Well congrats on having the guts to stick with it and ultimately turn it into a positive. Most people would have simply given up and taken the L! The other benefit of what you endured was the HUGE learning experience. You hit the nail on the head when you mentioned no amount of education, books, podcasts, etc. can substitute for real world experience. Its easy to read a few books, listen to some podcasts, watch some YouTube videos and then think because you understand the concepts you will be able to seamlessly apply them... it's a completely different thing to put all of the concepts and education to practice. Best of luck with your continued success! 

@Antony Charlier I know that you are eager to get started but I would not rush into anything too quickly with out having a solid foundation/ understanding of what you are getting into. Without this knowledge, you have the potential to make costly mistakes. There is a big difference between not taking action because of something like analysis paralysis and not rushing to jump into something that you aren't familiar enough with yet. Stay on these forums, keep networking, and keep learning (reading, videos, podcasts, etc.). Being that you are young, you might want to consider becoming an agent. It is fairly easy to do and its a great hands on learning experience. Plus it is pretty affordable to get licensed. Good luck!

I really don't see the benefit to renting the property out if you are not going to cash flow at all and you still have your equity tied up in the home. From what you described, you would likely be cash flow negative if you rent it out. The only upside of having a tenant is the equity pay down on your loan. But what if you end up with a vacancy for a month or two? Or if a tenant stops paying and you are unable to evict because of the current eviction moratoriums in place nationwide due to the Corona Virus. Would you be able to comfortably carry 2 mortgages (assuming you buy a new place)? If you had a 30 year mortgage on your home, you would likely be in a better position as the home would provide positive cash flow if you self managed and you would still get the benefit of the principal pay down from the tenant... Plus you can always send additional principal to pay off the home faster if that is your goal. With the 15 year mortgage though, you are locked into having to make that large $3500 monthly payment every single month. The 30 year just gives you more flexibility.  

Lease options are not as simple as they seem and do come with risks to both the seller and buyer. Especially if you are lease optioning your own home. One of the more common risks for you as the seller is that it has the potential to violate the due on sale clause of your mortgage. It rarely happens but if it did, would you be able to pay off the mortgage in full or refinance it yet again? You would also lose your Homestead exemption which would result in higher taxes and ultimately a higher monthly payment. 

There are also insurance issues that you have to consider. The lease option agreement may trigger the termination of your existing homeowners policy and the tenant buyer would have to have their own policy in place with you and your mortgage company as loss payees.   Also, would the non-refundable lease option fee collected up front be enough for you to use toward the purchase of another property? If I were in your shoes, I would consider some other options because the benefits don't justify the risks. 

Whatever you do, make sure you get a policy in place and FAST! You are taking a huge risk without it in place.