Thread Options
|
#1991952 - 01/28/15 09:10 PM
Overnight Rental Cabin
|
Platinum Poster
Joined: Jan 2007
Posts: 645
|
Is an overnight rental cabin considered residential or commercial for flood coverage? We are getting a loan from another institution and are afraid the flood coverage in place is not correct.
|
Return to Top
|
|
|
|
#1992026 - 01/28/15 10:42 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
It is a residential structure. People live in it, even if only for short periods of time.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#1992082 - 01/29/15 01:15 PM
Re: Overnight Rental Cabin
mdog76
|
Platinum Poster
Joined: Jan 2007
Posts: 645
|
I am just confused right now, and I might have worded my original question correctly. We are finding information that states if occupancy is less than 6 months, its considered "non-residential". The overnight cabin has an RCV of $633,000 and the loan amount is just over $540,000. The coverage in place is $250,000.
|
Return to Top
|
|
|
|
#1992087 - 01/29/15 01:46 PM
Re: Overnight Rental Cabin
mdog76
|
Junior Member
Joined: Feb 2013
Posts: 32
|
If it were me, I'd call the NFIP to see what coverage the building qualifies for. I've had good luck in the past getting quick answers to these types of questions.
|
Return to Top
|
|
|
|
#1992094 - 01/29/15 02:25 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
Dan, I disagree unless the cabin is more than a typical cabin.
Other Residential Building
This is a residential building that contains more than 4 apartments/units.
While they use the term tourist home later in the description, the more than 4 apartments/units is still the overriding factor. I have stayed in "tourist homes" that have more than 4 units.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#1992116 - 01/29/15 02:49 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Aug 2002
Posts: 47,532
Bloomington, IN
|
I agree Randy. For whatever reason I skipped right over the wording "contains more than 4 apartments/units".
This would have to then fall within the single family residential designation.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.
|
Return to Top
|
|
|
|
#1992136 - 01/29/15 03:21 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
KB, the actual difference is $250,000 versus $500,000 in flood insurance being available. The payout for non-owner occupied property is always ACV regardless of the classification.
But your point is well taken, as I see the OP did quote the RCV, which is not the correct number to place in the flood insurance equation for this situation.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#2220226 - 08/22/19 03:23 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
Not sure what manual you are looking at?
Other Residential
A residential building designed for use as a residential space for 5 or more units, or a mixed-use building in which the total foor area devoted to nonresidential uses is less than 25% of the total foor area within the building.
This category includes the following buildings where the normal occupancy of a guest is 6 months or more: • Dormitories; • Assisted-living facilities; • Condominium buildings; • Apartment buildings; • Hotels and motels; • Tourist homes; and • Rooming houses.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#2220267 - 08/22/19 07:46 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
Hmmm - very interesting concept.
It is going to make a lot of lenders under insured if that is the case. Because that means that every 1-4 family house they have as collateral that is used for VRBO or Airbnb is going to be underinsured if their loan amount is over $250,000 and they only have a dwelling policy.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#2221167 - 09/09/19 04:02 PM
Re: Overnight Rental Cabin
mdog76
|
Platinum Poster
Joined: Dec 2008
Posts: 729
Tennessee
|
We have an application for a loan where the applicants have a flood insurance policy that was accepted by another bank....
It is a single family rental property....the policy was written on the general property form as an "other non-residential" occupancy.
Shouldn't this type of property be on the dwelling form as "single family" occupancy and not primary residence?
Would this result in a huge increase?
|
Return to Top
|
|
|
|
#2221171 - 09/09/19 04:20 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
That is the very question from above.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
#2221181 - 09/09/19 05:10 PM
Re: Overnight Rental Cabin
mdog76
|
Platinum Poster
Joined: Dec 2008
Posts: 729
Tennessee
|
Yes, Randy...but it wasn't clear to me what the answer was.....
|
Return to Top
|
|
|
|
#2221182 - 09/09/19 05:12 PM
Re: Overnight Rental Cabin
mdog76
|
10K Club
Joined: Jul 2001
Posts: 83,393
Galveston, TX
|
I am not sure that we know. It appears correct based on the Flood Insurance Manual, but someone would need to get clarification from the NFIP. If that is the case, then as I said, if you are dealing with VRBO or Airbnb properties and your loan and the insurable value of the structure is over $250,000, there a lot of underinsured properties out there.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com
|
Return to Top
|
|
|
|
|
|