Did your insurance company put your Mortgage Company on Your Settlement Check? This is very common when your homeowner’s claim settles. If you have a mortgage, remember, the bank has an interest in your house. We always tell people that the mortgage company name is on the check because the bank actually owns your house, not you. Well, you will own the house once you pay off the mortgage, but until then, you are not the owner… at least in the eyes of the mortgage company. If you would like to test this out, stop making your mortgage payments and see what happens. Yes, they will foreclose on you and sell your house and keep the money. They can do that even if you owe a dollar on your house and default on your loan.
Unfortunately, there is not much you can do to remove the lender’s name from the check if you have a mortgage. The insurance company would be in trouble if they purposely left the mortgage company name off the check. We have seen that sometimes you can get luck and the insurance company forgets to do it when they issue your check, but usually not. By doing this, the lender maintains control of what you do with the money. They don’t want you to spend the money on a vacation, on credit card bills, a new set of cool rims for your car, or that trip to Las Vegas you have been dying to go on. In other words, they want you to spend it on that damaged property.
Insurance Claim Check Trick
There are some tricks, however. If the settlement check is under a certain amount, then the lender will likely endorse it and return it to you. If it’s over that certain amount, then they are likely to hold your money and distribute it slowly to you as the work is done. And yes, they will do periodic inspections of your property to see that you are actually doing it. Read about the process of handling a claim settlement check with the mortgage company’s name on it.
We do have one suggestion that will allow you to get your claim check back in one piece from the lender instead of them paying it out to you in portions. Call FAPA and we would be happy to explain it to you.
Florida Allstar Public Adjusting, Inc. Main office Florida 954-659-8333.
