Foundation repair financing is a term used by many in the construction industry. When repairs are needed, it will help to lower the cost of building and operations. Most contractors will require insurance coverage as a prerequisite.
The main issue is the amount of money that can be borrowed for repairs. If there is not enough cash flow then the contractors will not have to take this risk. This is why insurance is necessary. The amount of money that is obtained for foundation repair financing is determined by a contractor’s business plan.
The insurance premiums for these repairs can vary greatly between companies, so there is a good chance that your insurance rates will go up when you start a foundation repair financing plan. Insurance premiums for commercial work is typically more expensive than other types of insurance because of the nature of the business. It is a known fact that more commercial work is increasing in costs, especially with oil prices dropping.
The most common type of foundation repair financing is a straight forward line of credit, however this can be risky if the lender is a bad credit borrower. Most organizations that provide this type of financing will not require a down payment. Most companies will require that the work completed is the same as the amount borrowed up front.
A liability insurance policy is required for all foundation repair financing projects. This type of insurance policy covers the property of the contractor for any claim arising from the project. A construction insurance policy should be purchased before any work is done on the site.
In addition to the policy, a company’s general liability insurance should be purchased. This policy gives coverage for theft, injury or death that results from the job. If the contractor has an estimate for the foundation repair and the estimate is over the limit of the insurance policy, it is possible that anamount from the insurance policy will be taken out to pay for the damage.
While many companies offer a general contractor insurance policy, some will not cover the cost of the foundation repair until the project is finished. This is something that you will want to look into before you begin the repairs. Many companies offer an option for finance that allows the foundation repairs to be completed with the contractor starting out with the money.
This is especially useful to a business that is planning to use the foundation for something other than a home. For example, a home remodeling business may wish to purchase a contractor insurance policy that will cover work on the foundation. In order to keep the costs down, all contractors should be armed with a basic understanding of foundation repair financing.