For this deal, my mother and I secured financing through a Debt Service Coverage Ratio (DSCR) loan, which allowed us to borrow based on the rental income potential of the property.

You’ll also need owner and lender's title insurance as well as the standard fire and liability coverage, which I assume you already buy.

Unlike DSCR (Debt Service Coverage Ratio) loans for smaller multifamily (i.e. duplexes, fourplexes, etc.) that allow market rents (not actual rents) to help determine if the property covers the mortgage payment, commercial loans look at what is happening today.

And it can change each year.I literally just had a tenant's portion go from ~40% to 100%... that means they completely lost voucher coverage and are on the hook for their entire rent.People don't seem to understand that S8 rents are not guaranteed.

These loans not only cover the property purchase but also 100% of the renovation costs, allowing you to focus on the project without worrying about securing additional funding.Here’s how our loans work:Loan coverage: We can finance up to 90% of the property purchase price and 100% of the rehab costs.Max ARV (After Repair Value): Depending on your experience level, we offer up to 75% of the ARV, ensuring that your project has strong financial backing.First-time investor friendly: If this is your first fix-and-flip, don’t worry.

Others choose to hold properties in their personal name and rely on umbrella insurance, which is simpler but may offer less comprehensive protection.

In my experience the best coverage with the lowest premiums hardly ever come from the big brand name insurance providers like Allstate, Statefarm, Geico, etc.

Maintaining a high-coverage umbrella policy is also an option to cover all properties.

I just make sure I have plenty of liability coverage and talk to my insurance broker about any additional coverage that could protect us.

Meanwhile these same service providers don't explain the legal process which ties into how the insurance coverage truly works let alone explain how to utilize additional insured status, indemnification clauses amongst many other tools at your disposal  because that is not a profitable business for these service providers to be in.