Wednesday, November 28, 2012

Citi's HomeRun Mortgage Program & Deal Killers: Don't Let your Deal Die

Last evening, we instructed our continuing education course, Deal Killers: Don't let your deal die, at Briarcliffe College in Patchogue. 

During the course we received many questions from students about what alternatives there were to FHA funding to help SAVE a deal for a highly leveraged transaction. Our friends at Citi suggested the HomeRun program.

Here are the details: 


HomeRun is Citi’s exclusive portfolio Program that has no mortgage insurance and no price ups. It is designed as a responsible financing solution to meet the needs of the low-and moderate-income (LMI) borrower. It provides the stability of a fixed rate, the flexibility of lower down payment options, and the added borrower protection of a relationship with a nonprofit housing organization committed to helping the borrower stay on track with payments. Fannie Mae Community Lending guidelines apply except as modified by the Mortgage Policy Manual (MPM) Fact Sheet.

  • 97% LTV financing
  • 3% seller contribution toward closing costs and prepaids on CLTVs greater than 90%, 6% on CLTVs 90% or less
  • Minimum FICO score is 640
  • Non-traditional credit is allowed with insufficient credit history and no FICO score
  • No mortgage insurance
  • Available to returning and first time homebuyers as well as existing Citi customers

Additionally, Citi has provided access to the Federal Financial Institutions Examination Council's Geocoding System that they discussed last evening. Click here to learn more. 

Tuesday, November 27, 2012

The Mortgage Forgiveness Debt Relief Act & National Association of Attorneys General

On May 9, 2012 we blogged about the importance in extending the Mortgage Forgiveness Debt Relief Act of 2007. To read that blog, click here.

On November 20, 2012, the National Association of Attorneys General joined the cause by writing this letter to the Congressional Leadership of our Federal Government.

Additionally, the Real Property Committee of the Suffolk County Bar Association also drafted a similar letter to our local leadership in the region.

Its imperative that this act is extended to protect those vulnerable community members who have underwater homes. Additionally, there are many secondary and tertiary effects on our local economy that will be realized if this act is not extended.

Please contact your representative and stress why this Act should be extended.

Friday, November 23, 2012

Bi-Weekly Mortgage Payment Plan - Its the extra payment that matters!

During this Thanksgiving I was spending time with some good friends who recently purchased a house. They are great people, but not particularly knowledgeable about the real estate industry.

My friend said to me that his wife and him were discussing setting up automatic payments for their mortgage, which I thought was a good idea so they would never miss a payment.

Then, my friend said that once they got situated in their new house that they would switch to paying every other week to cut down their interest and make the mortgage term shorter. My response was simple, "So you are going to make an additional payment a year on your mortgage?". He responded with "No, I am just going to pay every other week and we will save money, everyone does that", as if I was some sort of fool who had no idea how mortgages worked - thanks for the lesson. I thought that I may share with him why he doesn't understand what he is talking about, but on second thought I thought it is Thanksgiving and he didn't ask me for my professional advice, so I should keep my mouth shut.

To be clear, paying every other week as opposed to monthly is not a magic trick. The bank is not happy to merely receive payments in partial amounts more frequently than in full amounts monthly. Instead, paying bi-weekly results in 26 half payments throughout the course of a year. 26 half payments equals 13 full payments. Math not magic is what matters. So, the result is that a bi-weekly payor is making 1 extra payment a year and that is the SOLE reason that a loan's term is accelerated by expeditiously reducing the loan's principal balance. Moreover, as you reduce the principal, the amount of interest paid is reduced. This is actually what my friend was saying; albeit confusedly. In fact, it works the same if you simply make 13 payments a year as opposed to 12.

However, mortgagors (borrowers) should not EVER unilaterally decide to make bi-weekly payments. Instead, they must discuss their desire with their lender first. Many lenders want a one-time setup fee for this service and require online payments as opposed to checks.

Or, instead, mortgagors (borrowers) can simply send an extra payment annually and they are set.

Enjoy the holidays. I've learned that when I keep my mouth shut I enjoy the holidays too.

Tuesday, November 20, 2012

Federally Declared Disasters - Supplemental Directive (Modifications)

On November 16, 2012, we blogged about the Making Home Affordable Program's forbearance program for victims of Hurricane Sandy.

Today, Treasury issued Supplemental Directive 12-08, which addresses Federally Declared Disasters, such as Hurricane Sandy, and specifically directs Non-GSEs (servicers) with respect to the following topics:

  • Flexibility with Borrowers in Federal Emergency Management Agency (FEMA) Designated FDD Areas
  • Forbearance Plans
  • Borrowers in a Home Affordable Modification Program® (HAMP) or the Second Lien Modification ProgramSM (2MP) Trial Period Plan
  • Borrowers in a HAMP or 2MP Permanent Modification
  • Handbook Mapping

To read Supplemental Directive 12-08, click here.

Age Discrimination in Housing

At our recent continuing education course, The Fair Housing Act, a student challenged our slideshow, which showed the list of protected classes. Specifically, they adamantly argued for the inclusion of age as a protected class. As explained then and reiterated now, there are multiple fair housing and discrimination laws of which real estate agents must be mindful. The course taught was the federal law, which does not expressly protect age. Nonetheless, New York has a law called the Human Rights Law that makes it unlawful to discriminate on the basis of age, among many other classes. However, the law does not apply the class of age to those under the age of 18, instead the class of familial status applies in those situations. Additionally, the law doesn't apply to housing restricted to those 55 years of age or older. Moreover, publicly assisted housing for the elderly is also exempted.

The message for real estate agents out there is that they need to consider a multitude of laws from Federal to State to Local (County, City, Town or Village) prior to practicing in a particular area.

The FTC is Investigating Deceptive Ads in Real Estate Marketing

According to Ad Age, the leading publication in the advertising industry, the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) are jointly investigating deceptive ads concerning mortgage modifications, short sales and workouts.

To read the article, click here.

The article expressly states that real estate agents have received warning letters from the FTC. Of specific concern to the FTC & CFPB was the practice of utilizing images of President Barack Obama in ads promoting loan-modification services, which wrongfully communicate to consumers that certain services are affiliated with the government. If you use the President's image on your advertisements, take it down now! 

Real estate agents this is important. When you work in mortgage relief, you must be mindful of the Mortgage Assistance Relief Services (MARS) Rules from the FTC, a summary of which can be found by clicking here.  Also, in New York, Distressed Property Consultants must additionally comply with Real Property Law section 265-B, the text of which can be found by clicking here

During each of our continuing education courses to real estate agents on foreclosure, whether its Foreclosure and the Economy: the Short Sale Course; or Foreclosure Filibusters we always stress the importance of these laws and regulations. Unfortunately, we always also get responses from agents that we are being ridiculous. This is very serious and far from ridiculous.

Real estate agents should also be mindful that the FTC's watchful eye is not restricted to mortgage modifications. As stated in our course, To be Green or Not to be Green: That is the Question, the Green Guides are available by the FTC and demonstrate the need to be candid and avoid deception in advertising Green Housing & Buildings. To read the Green Guides, click here

As Lieb School always states: You are a real estate Professional; knowing these laws makes you a value-add to your clients and customers. Now go study. 

Monday, November 19, 2012

Landlord Tip - Safety Glass - Is your rental house safe pursuant to statute?

Pursuant to the General Business Law, residential buildings and other dwellings must use safety glass in sliding glass doors, storm doors, shower doors, bathtub enclosures and "fixed glazed panels immediately adjacent to entrance and exit doors which may be mistaken for doors". 

The purpose of this law is to minimize the likelihood of piercing and cutting injuries. 

Landlords, be sure to perform a compliance analysis of your unit before renting. Failure to be in compliance with Statutes and Codes will devastate you if someone is injured in your premises. 

Friday, November 16, 2012

NY Attorney General to Wells Fargo - Modify Mortgages Now

Today, NY's Attorney General, Eric T Schneiderman, warned Wells Fargo to immediately recommence reviewing mortgage relief applications after the servicer / lender suspended its review process until it receives instructions from FEMA. Unfortunately for Wells Fargo, it has a settlement with 49 State Attorney Generals, that its new policy is now likely breaching.

To read the AG's press release, inclusive of his letter to Wells, click here.

While its not clear that Wells Fargo's policy was intended to hurt homeowners seeking a mortgage modification and instead was a response to the storm, it is clear that NY's Attorney General is quite serious about protecting struggling homeowners in his State and helping them to stay in their homes.

This is a good sign for homeowners seeking a modification.

Hurricane Sandy Mortgage Forebearances

Last evening we instructed our continuing education course Foreclosure Filibusters at Newsday's Corporate Headquarters for approximately 100 real estate agents. It was so gratifying to instruct this particular group of professionals as they continuously focused our course on their expressed concern for those who were devastated by Hurricane Sandy. They expressed concern for those presently in foreclosure proceedings and for those who will now likely default on their mortgage. They cared about their community, their friends and relatives. They wanted to help.

We discussed the mortgage modification process under HAMP. We addressed proactive short sales under HAFA. Now, we provide guidance for borrowers who need assistance as a result of Hurricane Sandy, which was a Federally Declared Disaster (FDD) pursuant to the Making Home Affordable (MHA) program. 

Please know that pursuant to MHA - "Any FDD forbearance plan should not impact the status of a homeowner's permanent HAMP modification."

So, if you, your clients or your customers cannot make payments as a result of the Hurricane, contact your servicer / lender and request an FDD forbearance until you can get back to affording life. 

To learn more about Treasury's direction to servicers in how they should make offerings of help to borrowers as a result of Hurricane Sandy, click here

Thursday, November 15, 2012

Open House = Open for Inspection by Municipal Building Inspectors

Last evening, I hosted our monthly meeting for the Real Property Committee of the Suffolk Bar Association where we discussed municipal zoning violations, among other topics. In our company were some Assistant Town Attorneys who clearly articulated that real estate agents should always be mindful, and advise their clients, that hosting an open house also invites law enforcement into the house for Code Inspection.

Therefore, if you are showing a property with illegal structures or occupants - DO NOT HAVE OPEN HOUSES!!!

Monday, November 12, 2012

VA Loans on Veterans Day

VA loans are available to veterans, active duty personnel, certain reservists and national guard members, surviving spouses of persons who died on active duty or died as a result of service-connected disabilities, and certain spouses of active duty personnel who are missing in action, captured in line of duty by a hostile force or forcibly detained by a foreign government or power.

While VA loans are available through private lenders, the VA guaranties loan payments and thereby provides an incentive to lenders to make loans. The key advantages to a VA loan are as follows:

  • You can buy a home without a down payment - as long as the sales price doesn’t exceed the appraised value. (Of course, you have to qualify in terms of income and credit.)
  • You won’t need to buy private mortgage insurance.
  • VA rules limit the amount you can be charged for closing costs.
  • Closing costs may be paid by the seller. (You should keep this in mind when negotiating the sales price.)
  • The lender can’t charge you a penalty fee if you pay the loan off early.
  • VA may be able to provide you some assistance if you run into difficulty making payments.

  • To learn about eligibility FAQs, click here.

    Lets pay our respect to our veterans on this Veterans Day!!!

    Thursday, November 08, 2012

    Airbnb is Brilliant - NYC Housing

    What a brilliant company Airbnb is. A major barrier to their success are local laws that prohibit short term rentals in many municipalities across the Country. They want the biggest markets, like NYC, but NYC prohibits rentals for less than 30 consecutive days based upon the State's Multiple Dwelling Law at section 4.

    What a brilliant company Airbnb is. They see NYC's plight in the face of the destruction from Hurricane Sandy and they pounce. Not in a bad way, but instead as a savior of sorts. Yesterday, Mayor Bloomberg announced a partnership with Airbnb to help victims of the hurricane get necessary housing. Click here to read the article. You see, when two (2) political issues are face-to-face at odds, the public will choose the lesser of the two (2) evils. On the one hand, short-term rental housing has been associated with damaging the neighborhood environment, impairing the physical characteristics of a neighborhood and most importantly, creating safety hazards through unregulated units with transient guests. On the other hand, we have people without power, in flooded apartments that need a warm place to stay with the electricity turned on (yes Revolution, the power should be turned on). You guessed it, heat and power wins.

    Yes, the partnership is not a home run for Airbnb; they have not repealed the short term rental statute that stands as their barrier to domination. This statute makes their customers' rentals of weekend apartments often illegal. Instead, they have capitalized on an opportunity to gain good will and brand awareness in their continual cause to have the law repealed. Great job Airbnb, you are brilliant.

    Loan Modifications & the Federal Housing Finance Authority

    A very interesting article in Business Insider for all those who have Fannie and Freddie (GSE) underwater loans. While its true that the current head of the FHFA has blocked any attempts to have Fannie and Freddie write off losses of underwater loans, the article speculates that "He's going to lose his job in the next six weeks" and this will quickly change.

    An interesting aside is how this will create huge tax liabilities for homeowners in cancellation of debt income for those who have their underwater loans wrote off because the Mortgage Debt Tax Relief Act of 2007 is set to expire at the end of the year.

    Maybe, it would be wise to extend the Act prior to concerning ourselves with whether its prudent to write off underwater loans.

    Trump International Realty - Welcome to the Industry

    Donald Trump made some waves by starting his own real estate brokerage house this past month. The company appears to have offices in  New York, Las Vegas and Chicago. While Trump is a marque name in the development and property management sectors, its curious how he will fair in the licensed world of managing real estate agents, inclusive of the many ethical hurdles that the Department of State places along his way. Unfortunately for Mr. Trump, the Division of Licensing Services will not care who he is and instead will expect the same level of professionalism that they expect from everyone else. In a smart move, it appears that Trump International Realty is launching with a small group of established agents who can help set the pace for the company as it grows.

    To visit Trump International Realty's website, click here.

    Good luck Mr. Trump and welcome to the industry.

    Wednesday, November 07, 2012

    New Short Sale Rules - Treasury issues Supplemental Directive 12-07

    Some of the highlights of the Directive are as follows:

    • Use of certain HAFA documents will now be optional rather than mandatory, so long as the servicer communicates essential HAFA terms to the borrower in some written form.
    • Borrowers who request HAFA consideration and are ninety (90) days or more delinquent and have a FICO score that is less than 620, will be deemed to have a “pre-determined” hardship. Borrowers with a pre-determined hardship must execute a Hardship Affidavit prior to closing of the HAFA transaction; however, servicers will not be required to further validate the hardship.
    • Treasury will now require both the seller (borrower) and purchaser in a HAFA short sale transaction to execute a new HAFA affidavit prior to closing that certifies, among other attestations, that the sale represents an arms-length transaction and that no money is being given or received that is not reflected on the HUD 1 Settlement Statement. 
    • The time frame for servicers to make a decision on a borrower’s request for HAFA has generally been shortened to 30 calendar days. 
    • Treasury is increasing the incentive it will provide for permitting gross proceeds to be used to pay subordinate mortgage liens.
    • The current prohibition against resale of a property for 90 calendar days following a HAFA closing is being changed to prohibit any resale within 30 calendar days and prohibiting a resale for more 120% of the HAFA short sale price between 31 and 90 calendar days of the HAFA closing.

    Also, notate that these new rules are effective on 2/1/13, not immediately.

    To read the Supplemental Directive in its entirety, click here.

    Surviving the rule change is the following:

    A statement that if the borrower has a real estate license, he or she cannot earn a commission selling his or her own property and may not have any agreement to receive all or a portion of the commission after closing;

    Real Estate Agents - this does not mean to try to creatively earn a commission on your own short sale. You will likely face charges of perjury &/or fraud. Its just not worth it. Instead, simply hire a friend whom you respect at your company to represent you in your short sale.

    I just want to make a point of the fact that HAFA offers a proactive short sale. Being proactive with obtaining lender approval is the ONLY sensible way to seek out a short sale these days. Push your clients, attorneys and friends to work under the HAFA program. If you do, you will agree that HAFA is the way to go.

    Tuesday, November 06, 2012

    Hey real estate agents, Business Insider says you will find love!

    Just a fun article I found at Business Insider, take a read by clicking here.

    Although the article has no methodological basis for its prediction, its a good thought that real estate agents have such good fortune.

    Remember to vote on this Election Day.

    Saturday, November 03, 2012

    Condo destroyed in hurricane & evacuated, do you have to pay your common charges?

    Yes, unlike a cooperative apartment, where the warranty of habitability applies based upon the unit's characteristic of being a leasehold interest, a condominium's unit is owned in fee, as an owner of the land, structures and facilities. Therefore, a condominium owner must pay their common charges and assessments regardless of the hurricane rendering the unit unsafe for occupancy.

    Therefore, condominium owners legally have to pay common-charges while cooperative owners don't in the face of Sandy. Nonetheless, when cooperative owners don't pay, they are likely giving the kiss of death to their building, which will likely end up in foreclosure when it doesn't have money to pay its mortgage. So, its suggested that ethically, albeit not legally required, cooperative shareholders should pay and hope that their homes are rebuilt through their building having an adequate insurance policy.

    Before paying or not paying your maintenance or common charges, both condominium and cooperative residents should first consult with an attorney and review all applicable legal papers for your building.   

    Friday, November 02, 2012

    Attorneys and Real Estate Agents: Can they share office space?

    During our recent continuing legal education course, Real Estate Business Ethics, held on October 24, 2012, I was asked by an attorney/student whether they could ethically share office space with a real estate brokerage office.

    The answer is yes according to the New York County Lawyers' Association Committee on Professional Ethics in Opinion Number 733.

    Although the answer is yes, the Committee cautioned as follows in rendering its Opinion: "Joint office sharing arrangements with non-Designated Professionals, while historically permitted, should be entered or continued only when precautions such as sub-dividing space and separating communications are undertaken, and these precautions will be particularly important whenever reciprocal referrals are also contemplated". 

    The committee also offered the following suggestions: "If there is a common reception area, the signage and office nomenclature must not create the impression to the public that the lawyer and non-lawyer have a professional relationship. If there is one receptionist the same proscription applies. Existing space can be subdivided such that access to file rooms and computers containing confidential files is restricted."

    Lastly, it must be notated that the Opinion is not binding on the Courts in enforcing the ethical rules and furthermore, the opinion referenced to the Lawyers Code of Professional Responsibility, which was replaced by the New York Rules of Professional Conduct on April 1, 2009 and therefore is not dispositive. Nonetheless, it appears that similar rules exist under the new Rules of Professional Conduct and that the Opinion's guidance remains applicable. The practitioner is advised to seek out a new opinion from their local Ethics Committee, pursuant to the new rules, before acting.

    Co-op destroyed in hurricane & evacuated, do you have to pay your maintenance?

    No said the Appellate Court (1st Dept.) in Granirer v. Bakery, Inc.

    In its decision, the Court said that there is an "abatement of their maintenance until the apartment is restored to a habitable condition". Further, the Court stated that there should be a 100% abatement of maintenance, which includes "their contribution to the cooperative's tax and mortgage obligations".

    The Appellate Court quoted its prior decision in Suarez v. Rivercross Tenants' Corp for the proposition that "A proprietary lessee is entitled to the statutory protection [of the warranty of habitability] as well as the noninvesting, ordinary tenant".

    The Warranty of Habitability is a statutory right embodied in Real Property Law section 235-b that is required in every lease in New York. It provides that the property shall be "fit for human habitation and for the uses reasonably intended by the parties and that the occupants of such premises shall not be subjected to any conditions which would be dangerous, hazardous or detrimental to their life, health or safety".

    So, is an act of god, such as a hurricane, an exception to the Warranty of Habitability? No, said the City Court of Yonkers, Westchester County, when faced with this question in Spatz v. Axelrod Management Co., Inc.

    Nonetheless, it must be notated that a Co-op shareholder's (unit owner's) refusal to pay their maintenance will likely result in the Co-op becoming insolvent and eventually being foreclosed upon and the shareholder's proprietary lease thereby being rendered void. So, in the end, shareholders refusal to pay maintenance based upon a breach of the proprietary lease's implied Warranty of Habitability is actually attacking them-self.

    Its important for a shareholder who is considering not paying their maintenance to first review their proprietary lease and also consult with an attorney before acting and refusing to pay.

    Need disaster relief help?

    Click here for the government's website to assist those in need of help and resources.

    Flood exclusion to homeowners' policy litigation; Is it coming?

    Many homeowners' insurance policies exclude coverage from the effects of flood and surface water or natural water below the surface of the ground without exception. 

    As reported by Newsday, LIPA is estimating that 100,000 Long Island area homes and businesses have been devastated. Click here to read the article.  

    Therefore, many community members will be seeking insurance to cover their loss. While the flood exclusion sounds pretty straight forward, it may not be. In fact, ambiguities in the exclusionary provisions of an insurance policy are resolved in favor of the insured. So, you should carefully read the exclusion and seek the advice of counsel prior to accepting your insurer's position that you do not have coverage. 

    There are also unique situations for businesses with flood insurance. To illustrate, some policies require "safe storage" as a condition to obtaining coverage for valuable papers and records. In this situation, is this a strict requirement for coverage or does it instead have to be correlated (related) to the loss? These are questions that you should consider, research and than fight for your rights.  

    However, the exclusion may be clear and you may receive a denial. So, can you sue your insurance broker for your experience of flood-related losses because they did not recommend that you obtained flood insurance or flood insurance with suitable policy limits (how much money will be insured)? The rule is that absent a special relationship with your insurance broker (which rarely exists pursuant to law and facts), your broker has no duty to recommend a special type of insurance. Therefore, you likely cannot sue your broker. 

    Stay tuned, later we will discuss FEMA's designation of Flood Plain Areas and requirements for the purchase of flood insurance and how that may effect your loss. 

    REALTORS® on the East Coast Help Clients Pick Up the Pieces Following Hurricane Sandy

    Hurricane Sandy Damages Could Reach $50B

    Thursday, November 01, 2012

    Course Cancelled Tonight - 11/1/12

    Our continuing education course, Foreclosure and the Economy, scheduled for this evening has been cancelled and will be rescheduled as a result of Hurricane Sandy. Stay tuned for the announcement of our new date.

    Hurricane Deductibles - Great News

    New York Governor Cuomo announced yesterday that homeowners will not have to pay hurricane deductibles on their claims.

    A hurricane deductible is the amount of money a homeowner is responsible to pay for out-of-pocket before their insurance policy will kick in for hurricane related damage. Moreover, while traditional deductibles are generally flat dollar amounts for fire and theft (i.e. $5,000), with a hurricane deductible its often a percentage of the storm damage, which can be quite high (1% to 15%).

    To read the Governor's press release, click here.

    Voice of Reason: Insuring Your Home's Coverage for Bad Storms

    Some great information on homeowners insurance issues from our friends at Douglas Elliman:

    The following includes information regarding damage control immediately following Hurricane Sandy. Erik Braunitzer is a writer for Douglas Elliman, brokers for NYC, Long Island and Westchester Real Estate.

    Waking up after Sandy, many people in the Northeast are left with a devastating truth: their homes are gone or flooded beyond repair. Some of these homeowners may not be ready for the awful truth that comes next. They may not get their homes back. The truth is homeowner's insurance usually excludes flooding and hurricane damage. If you don't know the ins and outs of your policy before a destructive storm, it will be too late to change your policy later to cover these gaps. Most often, these following areas cause the most issues after devastating destruction.

    1. Replacement Value
    Replacement value or cost is listed in your homeowners policy and means the value of the loss at the amount it costs to replace an item. For example, if you have property in your home, such as a home computer, you may think that you will get a brand new computer with same features at the original price. However, unless your policy states this exactly in your insurance policy, losses are valued at what they were worth in the condition before the destruction--in this case, a five-year-old computer may only have a value of $200. Replacement-cost-value clauses should always be included in your policy.

    2. Flood Insurance
    Homeowners insurance policies usually exclude flood coverage, as well as hurricane cover and earthquake coverage. Whatever the cause, floods happen, particularly because of exploding pipes and the amount of rainfall in a hurricane. Floods are actually the most common reason for damage to the home. Some insurance companies include some types of flood coverage. If you live an area susceptible to flooding or if you want to be sure you are covered, adding flood coverage can save you from a lot of financial stress.

    3. Negotiating Valuation of Loss
    One of the first things that people do after a damaging hurricane is call the insurance company to file a claim. After you file a claim, an appraiser comes to the property and assesses the damage. These appraisers do not work for you. They work for the insurance company. They are looking for the minimum that the insurance company will have to pay in order to meet its obligations. However, you do not have to take that valuation as final. If you can prove the loss is significantly higher, negotiate a settlement with the company. To prove your claim however, you need to take pictures of damage and loss of valuables, as well as keep receipts for repair costs.

    4. Hotel Stay or Rental Coverage
    If you have this in your policy, it will be listed as "loss-of-use" coverage. This means that the insurance company pays to place you in a hotel while work is being completed on your home, if it is uninhabitable. Not all policies include these types of provisions and others have limitations, such as a maximum per day amount or a time limit for how long expenses are covered. To avoid the out-of-pocket living expenses after a hurricane, ensure that you have loss-of-use coverage.