Insurance swap to new home

Have a possible sub2 deal in the works. Not a lot of equity in it so planning to hold onto it for a little while. Might LO it but havent made up my mind yet. All I know right now is that they are willing to sell for whats owed on it and are pretty open to whatever I say actually. Point of the post:

They are buying a trailer from his dad. Hes paying cash for it, and they are paying him. So they are getting out of this house for whats owed on it, 8 years into a 30yr mortgage. Loan is with WF. Their insurance agent wants them to take their policy on this home and put it on the new trailer, leaving none on this one. What are some options in this case? First sub2/LO, Ive only done a few wholesale deals so far. Should I just have them get a landlord policy on the sub2 and then get my own HO policy in place?I plan on putting into a trust as soon as I figure that out some more. How is WF as far the DOS stuff? Thanks


It sounds like you worked the deal perfectly….“All I know right now is that
they are willing to sell for whats owed on it and are pretty open to whatever
I say actually” :biggrin

That being the case, your plan is sound. I assume that they are paying for
the landlord policy, but still listing you as “additionally insured”?

Regarding Wells Fargo and Chase, my primary subject to banks, they haven’t
inquired about me as the owner of properties I have held for 10+ years.

Some investors use the following strategy:
They inform the lender that the title to the property has transferred(usually to a trust)
and that payments are remitted from "Trustee/LLC/etc. If lender calls inquires about this
later, the new owner will state the notice of this transfer was given on said date.
I don’t believe giving notice of a title transfer negates a DOS, but it’s a tactic some use.

Keep it up!!! :cool

Since the property is under a mortgage, the mortgage no doubt requires that property insurance be maintained on the property. Proof of such insurance must be submitted to the lender annually. If the lender gets a whiff that insurance is lifted, then they will institute their own policy which is 3 or 4 times the going rate.

I wasnt talking about having no policy on it, I was just wondering what the best way to go about getting it insured was since they wanted to somehow move this policy to the new place. Thanks