@Mohamed Nagoor We used builders risk policy but it's been a couple of years since our last flip.

"Gambling" that the value of the asset will increase also has its risks.

You wouldn't want to expose the rental assets to the risk of Flips ( contractor falling off the roof).

From death threats to tenants being murdered to overdose to theft, property damage, fire, destruction, damage & everything else in between.The purpose of this blog is to peel back the curtain on the Property Management Business and show you some of the real life things that have happened to me or members of my company 1st hand.

If you're buying a flip project, you'll either need a Vacant Dwelling policy or a Builder's Risk policy. 

Just like others, i do not want to loose profits but i definitely don't want to charge too high risking vacancy.   

Just like others, i do not want to loose profits but i definitely don't want to charge too high risking vacancy.

No way to make money on that deal if there is no equity and if it is underwater.If you could get it for $0 down with her carrying the mortgage, and it would cash flow well, it would still be a gamble to consider but the risk would still be on her. 

He is trying to obtain financing, however, he poses a huge liability risk for me.

For example, if you think you can make $35K post rehab if everything goes perfectly and you get the price you believe you will get, then getting $30K for a quick as-is sale (more than likely to an end user) makes more sense and takes away the risk of unexpected problems during rehab and/or the appraisal issues I mention.