The lender will when they are calculating your debt coverage ratio.You have to run the numbers on the various scenarios.

(I may have posted the same question in the wrong place previously).

I've got a single family home in Sugar Land, Fort Bend County (77479). It's been difficult to find a dwelling/fire policy. The ones that ...

I am concerned that my name will be entered to the database and have difficulty to get appropriate insurance coverage in the future if we file a claim.

You really don't need a mortgage term policy designed to be reduced with a mortgage as you can obtain more coverage with a term policy that reduces on a uniformed reduction basis, a uniform decreasing term policy that will always cover any lien amount.Another matter, if it's a long term hold, an option to purchase and or first right of refusal can be used in the operating agreement, your equity may be applied toward the purchase as it's earned and acquired through the partnership.But, again, life coverage is rather unusual on small RE projects, but, OTH, I had a partner who was pretty healthy, my age who had diabetic not thought to be a big deal. 3 months later he was in the hospital having a foot amputated and 2 months later he had a stroke at my desk!

This is simply based on statistical analysis that shows clearly that buyers with no investment in the property are much more likely to walk away.The bank will also compute the debt coverage ratio based on both payments (1st and 2nd mortgages), and want to see this no higher than 1.25 or so, so that it a tough hurdle as well to make a property cash flow adequately with two mortgages.

@Clay Manship ,Bethni Moppin,Coverage ConsultantNational Real Estate Insurance GroupAffinity Group Management7509 NW Tiffany Springs Pkwy #200Kansas City, MO 64153P: 913-951-3285/affinitygm.com / F: 913.894.6534Tell her Aaron Yates referred you.

At the end of the day the building will be covered but not your personal coverage or liability.

Whatever you decide, you need a business plan. the more comprehensive, the better.

It's all rather confusing.What sort of insurance coverage do I need?

Say the title company missed it or that it was a cash transaction with an idiot buyer who did not obtain search or coverage.