Posted by Jerry Martin NC on August 27, 2003 at 19:23:15:
Perhaps it would be easier to have the seller sign an assignment of benifits in your favor and if anything happens you send it to the insurance company.
All this Subject To talk reminded me of a question - Posted by Thomas Allen
Posted by Thomas Allen on August 26, 2003 at 21:52:32:
When you do a subject to deal, how do you handle the homeowners insurance? When they deed the property to me, I need to get a new insurance policy whether I’m going to rehab it, sell it to a T/B on a L/O, etc. … right? So it seems logical that the homeowner who deeded me his property needs to cancel his insurance, but that is usually going to be part of the payment that I’m going to start making for him. How would he/we go about cancelling his insurance and me getting a new policy without tipping off the lender?
Keep the same policy! - Posted by Rob Ricker
Posted by Rob Ricker on August 26, 2003 at 23:24:29:
The homeowner DOES NOT cancel his policy. You have your company and the trustee (of land trust) named as “ADDITIONALLY INSURED” on the policy. You also have the policy changed to a “LANDLORD POLICY”.
Mistake By Me - Posted by Rob Ricker
Posted by Rob Ricker on August 27, 2003 at 13:48:10:
additionally insured should be the trust and trustee. Not your company. Your company is the new benificiary of the trust, but you don’t want the company name on the old policy. This way, thhe lender will not be tipped of that ownership has changed AND the insurance policy will not be void if, God forbid, the house burns down. Sorry for the mistake.
But!!! - Posted by Bill
Posted by Bill on August 26, 2003 at 23:41:37:
But then the house burns down lets say. The insurance policy holder will find out that the deed did actually tranfer and not have to pay the claim since deed thranfer voids the policy. They will be excited about that. I think the way to do a sub to is to leave the existing insurance in place so the bank does not get wind of the transfer and get an ADDITIONAL insurance policy to cover your intrest. Yep, that will be additional cost for you. You will be paying insurance 2 times.
Awesome, thanks! - Posted by Thomas Allen
Posted by Thomas Allen on August 26, 2003 at 23:31:15:
Thanks!
or… - Posted by Jim FL
Posted by Jim FL on August 26, 2003 at 23:47:27:
Bill,
Why pay for two insurance policies?
Seems like a waste to me.
Instead of that, just cancel the old policy, getting a new one, naming the trust as the insured and loss payee being the trust and the lender.
As long as payments are made, the lender won’t care who is on the insurance, especially a trust.
No need to pay for more than one policy, especially over paranoia.
Take care,
Jim FL
This was my original question… - Posted by Thomas Allen
Posted by Thomas Allen on August 27, 2003 at 08:59:04:
How do you do all that without alerting the lender to what’s going on? When he cancels his existing policy and you get a new one, chances are that both will notify the lender in writing. Surely the lender will know something strange is going on … no?
Re: This was my original question… - Posted by GeorgeWBush
Posted by GeorgeWBush on August 27, 2003 at 09:13:48:
It’s like Jim said. It doesn’t matter if the lender finds out what’s going on, especially if the payments are current and are kept current. If you take ownership in a trust, and then get your own insurance policy and the lender is named as an insured party, it is unlikely you’ll even hear from them.
Do not pay for two policies.
It would be a waste.