All Forum Posts by: Matthew Hammond

Heh, I've been receiving the same type of responses. This is word for word the response I received from one agent:

"Hi. Matt. Thank you so much for the opportunity. This is a market that is becoming vary difficult. I have carriers not writing dwellings and some that might. With that said I am seeing rising prices. Lots of information will be needed and applications filled out. I would be more than happy to discuss this with you. I am not sure if it’s a good market to be shopping . I have been doing this for 39 years and never seen the property insurance market like it is now.If you Wnt to discuss let me know . Thanks again. Ron."

Then I talk to him and he tells me I shouldn't change anything because no one will insure portfolios without coinsurance now. I talked to a State Farm agent and they said that regardless if you call the place vacant or "in between renters" it is the same and State Farm provides no coverage for that period. So if your contractor injures himself or someone wanders onto your property and hurts themselves you're screwed because you have no underlying liability coverage required for your umbrella. Too much of a risk in my opinion - great if the policies are low cost but if they don't protect you from a major loss then there is no point in having the insurance, you might as well save the premiums and roll the dice that nothing is going to happen.

The only option that seemed semi-viable was American Modern but there have been mixed reviews on that so I'm not sure about switching. I think I'll keep USAA / Liberty Mutual combo for now and then revisit this again in a year or two if my portfolio continues to grow.

8 of my properties are in Indiana and giving me the most insurance issues given policy differences, etc. I also have 1 4plex rental in CA, 1 SFR in VA, and 1 4plex rental in DC that I didn't mention above. Ideally if I could get them all with one company on one policy it would be best, but the different States will probably prohibit that.

Hey all,
I was just curious what companies and insurance policies people are using for those who have more than 4 SFR or 1-4 unit residential rental properties. Currently I have 8 rentals ranging from single families to 4 unit buildings. My first insurance carrier (USAA) limited my standard fire/liability policy to only 4 properties so I just went out and picked up a Liberty Mutual policy for the remaining 4, but now I'm in the same problem since LM won't insure more than 4 either. They also don't insure LLCs, they insure me with the LLC named as an additional interest on the policy... which is probably fine but who knows.

Anyway I have also been having issues recently with the carriers conducting their own inspections and then randomly determining that repairs are needed (USAA cited that the gutters on one of my properties needed to be replaced so they cancelled the policy pending a licensed contractor to do that), their coverage for the houses seems to vary, and the premiums are really quite high to be honest. I was trying to find one company that would insure 8+ separately deeded properties but I haven't been able to find one from a company that I knew.

Who do you guys use and how much coverage do you get? Any thoughts or ideas?

I appreciate all of the info and apologize for the delayed response - I've been traveling overseas. The rehabber used some first month's rent discounts to get the property to full occupancy over 3 months. It's only 8 units and they are all 2s and 3s so it wasn't too difficult for him. The gross rent at the current leased amounts is $82k per year, projected expenses are $35k ($4.3k per door which includes a concession for vacancy), asking price is $300k. However as you all pointed out the lack of history is a big problem. I have good credit and two other 4plexes, 1 SFR, and 1 condo that I have all rented out so I have some experience, and I would be fine PG'ing the loan... but even with that I don't know where exactly I'd be able to find a lender that would underwrite the deal. If you know of any lenders who would potentially fund this, please shoot me a PM or e-mail.

I've been looking at some fairly cheap smaller commercial properties (6 - 12 units) which have been recently rehabbed (less than 3 months ago) and are now currently fully occupied in the Chicago area. They look like substantial values given the current rents and projected expenses, but I can't find any lenders that will lend on these commercial properties because most want to see 12 - 24 months of actual income and expenses for them.

Does anyone know of any lenders that will finance these types of transactions (ideally at 70-75 LTV)? I've tried both local and national banks but haven't had any success.