by contemplatingnothing » Mon Jan 19, 2009 04:05 pm
After a house fire, rather than using the insurance $$ for structure damage to remodel the house, can I sell the house "as is" and keep the insurance $$? I have someone interested in buying my house/lot without having to put this money back into the house and I wanted to know if this was legal to do.
Posted: Mon Jan 19, 2009 11:33 pm Post Subject:
I am not sure here but when someone comes along they may need to know if you own the house or if it is mortgaged.
Posted: Tue Jan 20, 2009 12:24 am Post Subject:
The house still has a mortgage but the loan would be paid off when the property is sold "as is"... leaving the insurance $$ as a credit with the mortgage company. Are they obligated to give it to the homeowner or do they have to return those funds to the insurance company?
Posted: Tue Jan 20, 2009 05:50 am Post Subject:
The insurance $$ is initially given to the mortgage company to pay the company directly that is remodeling the house. If the mortgage is paid in full, that insurance $$ is left over. Does the mortgage company have the obligation to pay that $$ directly to the homeowner or is there a legal issue that requires the $$ to go back to the insurance company?
Ideally the residue of the claim should return to the insurance company. However, it happens very rarely. The claim check once paid belongs to the claimant. Therefore, you may suggest the mortgage company to pay the residue to you instead of paying it back to the insurance company.
By the way, is the insurance company paying you in full before the reconstruction of the house? Normally, they pay only a portion of the claim amount to the constructor prior to the repair work and the remaining after the work is done.
However, just hang tight someone with more knowledge will shortly be around.
Posted: Tue Jan 20, 2009 06:34 am Post Subject:
The house still has a mortgage but the loan would be paid off when the property is sold "as is"... leaving the insurance $$ as a credit with the mortgage company.
OP you are required to inform the lender that you are contemplating about selling the property. I think its mentioned that way in your mortgage deed. However, since the claim check was made to the mortgage lender, they would return it to the insurer. The lender can't direct the check to you.
Posted: Tue Jan 20, 2009 11:57 am Post Subject:
Are they obligated to give it to the homeowner or do they have to return those funds to the insurance company?
Absolutely they are required to...you can sell the house, and the rest of the money is yours to keep it was meant as compensation for you loss...selling the house as is makes no difference, you are still entitled to that payment.Ideally the residue of the claim should return to the insurance company. However, it happens very rarely. The claim check once paid belongs to the claimant. Therefore, you may suggest the mortgage company to pay the residue to you instead of paying it back to the insurance company.
Jeorge this is incorrect, the insured is due this money...would be the same if a vehicle were damaged and the owner decided to sell it or not repair it and keep the money..the insurance company is NOT entitled to the balance of the monies after the mortgage is paid...Posted: Tue Jan 20, 2009 10:48 pm Post Subject:
I must say that is good to know when I read the statement I thought it would be rather unfair. What happens if they only pay a portain of the claim and the person is not going to repair the home or is this point not correct either?
Posted: Tue Jan 20, 2009 11:30 pm Post Subject:
What happens if they only pay a portain of the claim and the person is not going to repair the home or is this point not correct either?
Well then thats a problem...some companys now issue a portion of the claim, then the balance when it's completed or personal property has been replaced....personally i think it stinks but someone got it thru...and honestly i'm not sure what happens then..hopefully tcope will pop in, (i haven't handled property claims for many years, that was NOT done when i was still handling them)..Posted: Thu Jan 22, 2009 03:10 am Post Subject:
Depending on the amount of the loss, the depreciated amount will be issued minus the deductible with the mortgage company on the check. If the repairs are not complete, the recoverable depreciation (the rest of the money) will not be issued. An insurance policy owes the insured what they had unless the insured has a replacement cost policy. This is what the initial payment of the depreciated amount represents (what the insured had). The replacement cost policy provision does not kick in until repairs are complete. If the loss is small (usually under 5K), they may issue the entire amount as it saves paperwork, gets a claim closed and keeps from re-inspections.
Posted: Thu Jan 22, 2009 12:03 pm Post Subject:
well there you go then..thanks Das..
Posted: Sat May 29, 2010 09:21 pm Post Subject: ROOF DAMAGE
WITH A REVERSED MORTGAGE WILL I GET THE RECOVERABLE DEPRECIATION CHECK
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