Matt's Take on the News
May 8, 2012
Lenders are at it Again!!
Force placed insurance has been around for many years. All mortgages require the homeowner to have insurance on the home. If the homeowner does not keep insurance on the property, the lender can "force-place" insurance on the property. This force placed insurance is much higher than a policy that can be gotten by calling around to local insurance companies. The only way a lender can force place insurance is by deeming the insurance that is on the property insufficient or the policy has lapsed.
So you may be asking why this insurance is higher than most policies that you can buy from a local insurance company. Some of the insurance companies are owned by the banks or the banks work out arrangements with the insurance companies whereby they agree to buy high priced policies. Many of these insurers then pay a commission to the bank which is built into the premium. The homeowner, who is most likely struggling to keep current on their mortgage payment, then is billed for the premium along with the commissions.
This is challenging for many homeowners who are just able to make their mortgage payments. With the higher premiums, it makes the payment to high for the homeowners to make their full payment. In my opinion, this is a hidden cause of many homeowners who are going into foreclosure and one that is not spoken about often.
What are your thoughts?
I visit with people on a very regular basis. When they ask about us and "what we can do for them", I always point them to our web site that is loaded with testimonials. Visit the page at http://distinctpropertysolutions.com/testimonials.html and tell me what you think.
If you have a short sale, would you rather work with a buyer that has these types of testimonials or would you rather work with someone that simply talks a good game? I think you know the answer, so call me!