All Forum Posts by: Nicholas Covington

Hello Joe!

The rules will still apply for insurance as it does for home loans. It will always cost more to insure a rental property that isn't owner occupied due to added "risk." There are many other factors that are considered for premium pricing, which in your case would be the the area and the age of the home. I would assume that you home in SD is new than your rental. 

My advise (if you haven't tried already) is to see if your current company insuring your SD home will give you a policy for your rental, which might save you some money through "bundling." Otherwise if you have the opportunity I would try to find a broker in that area, since they will have more resources to use. 

Regarding insuring for the full purchase price, that would depend on the type of property you are buying. Is it a condo, SFH, Townhome? You might have bought it for 81k, but would that even be enough to cover the replacement cost if the place to was to be completely destroyed? These are questions that a broker familiar with the area would have a better idea for as they would know what is a good $ amount of coverage per sqft.

Good Luck,

Nick

Hello Micheas,

If I am reading your post correctly I would say that what you are asking for isn't feasible. As closing costs are pretty much things that the banks has paid on your behalf and need to collect from you at some point. If anything you can look into seller concessions (up to a certain % depending on loan type), where the seller will eat the cost of these items for you. Normally when things are asked to be "waived" the lender will hike up the interest rate to collect from their loss. Essentially you are asking for them to pay for services required to close the loan for free. Also when it comes to REI there is a higher cost of offering a loan than say someone looking to purchase as "owner-occupied."

So to answer your question, no I do not see a lender doing this unless they are rolling it into the loan or through concessions. But in all reality "close mouths don't get fed," so by all means it doesn't hurt to ask. Maybe I would look into working with a broker who is not tied to one particular lender as a banker can only deal within their own lender guidelines and have limited choices.

Best of Luck,

Nick

Hello Jeremy, let me start by saying that I am sorry about the position you have been placed in. As a Licensed Agent I can tell you this happens very frequently. As John stated, forced placed insurance is ONLY for the interest of the mortgage company leaving you to fend for costs if something else were to occur.

I am not sure how you have been searching for insurance, but if it has been "over the phone" you are wasting your time. You need to head to an office and find a reliable broker who can use his connections to locate you some coverage. It will be quite high, hopefully lower than your forced insurance, but it could potentially be the same depending on the payout of your previous claims. My advice is just to get your foot in the door, having a lapse in your coverage is going to be the killer for high costing insurance premiums. Grab something from the broker, accept that you are going to have to pay a much higher premium than what you are used to, tough it out for a year, and then shop around again.

Your claims back at 2014 will be counted for about 5 years depending on the carrier. As far as the copper pipes that's an underwriting decision, and I kind of say what they don't know won't hurt them. Of course I am not saying to give false information, but only answer what they ask.

Good Luck!

Nick