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Showing posts with label property owner. Show all posts
Showing posts with label property owner. Show all posts

Friday, June 28, 2013

Insurance for Real Estate Investors

Distressed Property Insurance

As our group started out as specialists in distressed properties, one of the problems we came across was insurance coverage for asset and worker protection. We thought if the Bank won't insure it, no one else will. But let’s look at it from the Lenders point of view.

167 Street Living Room Unit 2 Rehab Duplex
Why would you Insure this Property?

Investors always preach, leverage someone else's money not yours. That's true but Lenders are taking a risk. What happens if an injury occurred on the property or the asset burns down? The Lender is either stuck with court costs, fines, hospital bills or his money is gone due to the lack of insurance. So FYI...Lenders are going to make you insure the property. We rather get our own policy than make forced payments to the Lender's insurance policy.

Depending on your exit strategy, you will eventually need some type of insurance.

Front View 1184 Rehab Duplex
Would You Insure This Property?

Below is an outline of some of the coverage’s we implemented while bringing properties back online:

Types of Insurance Coverage or Services

  • Builders Risk Renovation Policy - Provides coverage that protects a person's or company's interest in materials, supplies and equipment used in the rehab or construction of an asset should these items become lost or damaged.
  • Liability Insurance - It protects the property owner in the event he or she is sued for claims that come within property boundaries. The policy is designed to offer protection against third-party insurance claims, like contracted workers or tenants.
  • Windstorm - Most policies issued today DO NOT cover damage from high winds. It is very difficult to get a windstorm rider due to the size of the deducible, ranges from 10K to 15K.
  • Flood - Damaged caused by rising water. Broken pipe or hoses causes damage to interior of unit or building. Flooding caused by storm surge.
  • Fire, Theft and Vandalism - During rehab you can expect one of these three items to occur. Are you protected from these likely events?
  • Insurance Loss Consultants - Provides Claims Representation to Policyholders. If you experience an event that financial hardship will occur, the insurance company is going to use every resource available to limit the payout amount and the policyholder is expecting the repairs to be done with no out-of-pocket expense, including the deductible. Insurance Loss Consultants make sure that the investor receives the largest benefit to which they are entitled under the insurance policy.
  • 4 Point Inspection is required if an investment property that your company or contractor is restoring is older than 30 years or being refinanced. Insurance companies will want to check the following four systems before issuing a Homeowners policy:
    • Roof
    • HVAC - Heat, Ventilation and Air Conditioning
    • Electrical
    • Plumbing
  • Our Contacts - These are companies that specialize in issuing policies that are going to protect you against the hazards of being a real estate investor.

In the beginning of the rehab depending on your exit strategy, insurance might not be needed but you will eventually. Remember, any property has value even if you can't see it. Are you prepared to lose that value if you don't insure it?

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Written by Bob Burns.
 
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Thursday, November 22, 2012

Homestead Housing Authority Miami-Dade County Florida New Section 8 Offices

Homestead no longer Strawberry Fields!

The Homestead Housing Authority in Miami-Dade County Florida has undergone some major changes since the real estate market began heating up several years ago. The City of Homestead enjoyed a good 10 years of expansion. Work force housing communities began springing up where strawberry fields, nurseries, orchards and farm land once occupied a majority of the acreage now developed. Major retailers like Wal-Mart, Nike and Home Depot, discovered that Homestead was the last stop for travelers and tourists before they entered the Florida Keys.

I discovered the Homestead Housing Authority back in 1998 when it was just a small office. I found the agency was very willing to work with Landlords and Real Estate Investors by making the Section 8 processing cycle very easy for owners and tenants. What I didn't find was a lot of investors or Land Lords using Section 8 or Plan Ocho as an additional marketing channel for finding tenants to occupy their investment properties in South Miami-Dade.

That was Then, This is NOW!

The Homestead Housing Authority has just completed a new building and road modifications to their facilities. HHA and the rest of Homestead has grown and caught up with the rest of Miami-Dade county.

During the recent real estate bust, investors have picked up bargin properties in Southern Dade County. If you are a Landlord or a property owner looking for tenants, the Homestead Housing Authority HHA is one source for potential tenants in Southern Miami-Dade County.

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Written by Blog posting Author +Bob Burns.
 
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Saturday, September 3, 2011

Miami-Dade Public Housing Agency MDPHA schedules meeting for Section 8 Landlords

Since REIC's blog discusses Section 8 or Plan Ocho in Miami-Dade County, I thought this news item should be posted. The budget for the US (United States) has gone through some serious cost cutting. HUD's Section Eight or Plan 8 will not be exempt from the reduction of funding. Section 8 landlords that have Section 8 HCV tenants or future landlords considering Section Eight, this meeting is vital for you to attend. I am SURE all the changes to the HUD' Sec. 8 program will be discussed by the Miami-Dade Housing Authority staff. Below is the meeting information:

"The Executive Director of MDPHA invites all owners and landlords with Section 8 (HCV) tenants to meet with him and his staff to discuss the HUD Financial Outlook and Changes. The changes impact: Payment Standards, Rent Reasonableness and Rent Increases.

Date: September 15, 2011
Time: 4:00-6:00 p.m.
Location: Port of Miami - 1015 N America Way to Terminal J Miami, FL 33132.
Security will require all owners and landlords to have registered for the meeting or they will not be able to gain access. You will also need to have a photo ID.
RSVP: September 6, 2011
E-mail: landlord@mdvoucher.com
Fax: 305-629-1032
Phone: 305-403-3222

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Saturday, August 6, 2011

Landlords, use HUD's Housing Quality Standards Checklist for your Section 8 property inspections.

HUD's Section 8 department has a program called the Housing Choice Voucher Program. This is the most popular of all the available programs Section Eight or Plan Ocho provides.

There are three parties involved when a voucher transaction occurs:

 

  1. The Property Owner or Land Lord.
  2. The County's Section 8 representatives.
  3. Tenant or Voucher Holder.

Each side has different responsibilities to allow and maintain the rental agreement. I intend to discuss each party's responsibilities over time but today I am reviewing the Land Lord's.

As you may know or may not, HUD has a list of HUD's HOUSING QUALITY STANDARDS CHECKLIST. Before a Tenant can move into a property, HUD must perform an inspection of the UNIT (rental property). A HUD certified inspector and the Land Lord schedule an appointment to inspect the UNIT (rental property). The inspection entails checking:

  • Mechanical.
  • Plumbing.
  • The UNIT's Interior.
  • The UNIT's Exterior.
  • Stairways.
  • Other.

For more inspection details, make sure you visit our HUD's HOUSING QUALITY STANDARDS CHECKLIST page.

If you should fail the initial inspection, the Land Lord has 15 days to correct the all the faults discovered by the HUD inspector and reschedule.

After you pass HUD's initial inspection, your potential Section 8 Tenant can move in after their paper work has been processed.

HUD is not finished!!!!!

In addition to the initial check, HUD performs a yearly inspection of the UNIT and provides their findings to the Tenant and Land Lord. Each violation will be accountable to either the Tenant or Land Lord. The letter will mention what date these violations must be corrected to avoid further action by the Housing Authority.

From my experience with my own properties, I only failed a HUD inspection once and that was beyond my control (hurricane damage).

Do you have any experiences with Section Eight or Plan 8 inspections that you would like to share with us?

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Written by +Bob Burns.
####
The Internet Kahuna Bob Burns MREIA Logo"Dale!"
Bob Burns Print Signature for MREIA
MREIA's President
about.me/RobertKBurns
Telephone #: 305-300-6242
email: rkburns@investmentpropertiesmiamiflorida.com
MREIA's Web Page: www.miamireia.com
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