The first thing they do is deny the claim).The first thing a lawyer checks on when deciding whether to file a suit is whether there is insurance coverage, even before he researches whether the alleged event is actionable.That doesn't make him a bad guy.  

I know a few insurance guys who have told me they are seeing more claims denied for this reason now than ever before.

You can deny it or prepare for it, your choice.I noticed each of the 3 red flags pointed out in Michaels first post about a month ago and have since taken steps to prepare for the future.

This is why we work with experienced investors- those who can appreciate the true value they are getting because they have put 20% down on properties before and have hired flaky contractors before and have been denied of 100% financing recently.

Not to sound harsh, but if they have a felony or multiple evictions, they are likely used to getting denied because that's pretty basic criteria.   

Also, the program you applied for which, we have asked for documents you have denied or prolonged giving us the documents.

@Jacob Lapp depends on your long term strategy ..these type of meltdowns only happen once in a while/generation -like any other asset you have to do your due diligence for stocks (look at I.e value metrics such as P/E ratio, etc).. yes stocks are way more volatile than real estate BUT there is no denying that there are many value stocks that are selling at 25-30% discount -my plan was to hold for 1-2 years and reinvest in RE.

Thanks in advance.I'll be interested to hear from anyone who has first hand knowledge or experience denying the smoking of medical marijuana use in a rental.  

@Tyler Gibson - there's no way in hell I'd keep this place if it were in NM...I do see your point about the emotional side of this one, I can't deny that. 

Would it make more sense to accept the new application instead of denying them and hoping my current tenants continue paying?