Force Placed Insurance Lawsuit

Most homeowners never hear about force placed insurance, or called lender placed insurance, until they receive a letter from their mortgage company informing them of it. If they don’t act quickly, the lender will buy it for them — at a price that is almost always more expensive than you would pay on the open market. In addition to being more expensive, lender forced insurance policies may also offer the borrower less protection. Zimmerman Reed represents homeowners standing up to their mortgage company for this practice. If you would like more information or if you believe you have a claim against your lender, call us at 1.800.887.8029 for a free case consultation.

Forced into buying expensive homeowner’s insurance?

Home mortgage agreements include a promise to maintain a homeowner’s insurance policy on the house to ensure the property is adequately insured. Many people don’t realize that if there is a lapse in insurance coverage, lenders can re-insure your home loan by buying insurance to replace it. When homebuyers do not pay the charges or show proof of their own insurance, penalties quickly add up. In the last couple of years it seems this practice has become common place resulting in numerous complaints from concerned borrowers about the higher rates and the difficulty in removing these charges.

It also appears that some predatory mortgage lenders may be taking advantage of this mortgage provision just to increase fees they charge to borrowers and adding lender placed insurance even when the homeowner already had insurance. Force placed insurance should only occur when an insurance policy has lapsed. Upon receipt that the borrower has reinstated their insurance, the forced placed coverage should be cancelled. Many times, a force placed insurance policy protects the mortgage holder more than the property owner. For example, the insurance policy may only cover the amount of your loan and not the full value of your home or its contents.

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How We Can Help

Mortgage documents and laws are complex, and it takes an experienced attorney well-versed in mortgage and real estate law to assist you in determining if you’ve been affected. Zimmerman Reed has a long track record of holding unscrupulous mortgage companies accountable in court. We have represented homeowners across the country dealing with financial loss due to illegal mortgage practices. If you would like more information, or would just like a free initial consultation with a lawyer experienced in this type of litigation, please call 1.800.887.8029 or fill out a free case review form. Zimmerman Reed is experienced in handling mortgage cases and we welcome any questions you may have.