I hedge with higher liability coverage and feel that as long as your coverage is equal to or greater than your net worth, you're probably going to be okay. 

Fast forward: Servpro serviced and Insurance fixed the repairs, basically everything seems new in this place, but I'm still not sure how to feel about it.

This is extremely risky as the borrower if he is not paying his mortgage is most likely not paying his taxes or insurance on the property.

Basic details of the refinance I'm being offered:Interest: 4.5% up from 3.25%PMI: $0 down from $281Total Loan Value: $240,000Monthly payment including tax and insurance: $1,524 down from $1769I didn't catch the closing cost total, so I'll need to follow up on that.

I wanted to ask if anyone has thoughts on fighting to have your FEMA flood insurance lowered.

If you have your team (insurance, property manager, cpa, etc) in place you will inspire confidence in the lender. 

$109,900 sale price, $600 annual insurance, $1,464 annual taxes ( exact ), $21,980 down payment, $1,050 Est rent, 8% property mgnt ( exact ), $5,000 Est closing cost. 5.25% Interest rate on 30yr loan with factoring in 7% for vacancy and 7% for repairs you are looking at $161.00 in Net cash flow with a 7% ROI. 

 ( I took my test 30 years ago )  But a licensed contractor , is required by law to carry insurance .

The numbers: gross 292,000, taxes 31,000, insurance 12,000, 5% maintenance+5% management+10% vacancy=58,400, the seller has agreed to seller finance with no down payment at 40 year amortization @ 6.75% for 2 year bubble.

The rise in valuations has increased my taxes and insurance to the point where I will be cash neutral on one property and cash negative on another.