Questions about force-placed insurance and escrow accounts

S

SCMts

New Member
Jurisdiction
California
My mortgage company failed to pay my homeowners insurance premium and the policy was canceled.

The premium was $1,146.00 from 12/15/15-12/15/16
I have an escrow account with enough funds to cover this amount.
After the insurance policy was canceled, the mortgage company bought force-placed insurance with funds from my escrow account.
Their premium was $3031.24 from 12/15/16/-112/15/16
I was unable to renew my original insurance policy and purchased a new one.
My new policy was $1,288.00 from 2/18/16-2/1817.
There is a lapse in coverage of 2 months and three days.
I am being charged $538.34 for that lapse.
It is $377.92 more than my original policy would have cost for that time.
My premium rose $142.00.
I want them to credit me for the total amount of $519.92.
Do I have the right to be reimbursed this amount?

Is it legal for them to buy force-placed insurance when they didn't pay my insurance and I have an escrow account?

Thanks.
 
SCMts said:
Do I have the right to be reimbursed this amount?

Is it legal for them to buy force-placed insurance when they didn't pay my insurance and I have an escrow account?
Click to expand...

Those are loaded questions and there is no simple yes or no answer because all of the answers depend on why the mortgage company didn't pay the premium.

What did the people at the mortgage company say when you asked them why the premium wasn't paid?

If you haven't asked that question yet I suggest you do so and then come back with the answer.

Oh, here's something else. Presumably you got notices from the insurance company that the premium wasn't paid. That usually happens just prior to the lapse or within a few days after. What happened with that?
 
Thanks.
I found an answer at HUD.gov...

As long as your mortgage payment is not more than 30 days late, Section 6 of RESPA requires the lender to make escrow payments, for taxes, insurance, etc., in a timely manner. You should write to your lender and complain. If your lender does not refund the difference or otherwise resolve your complaint satisfactorily, you may wish to file a complaint with HUD or the Consumer Protection Office of your State Attorney General's Office. You may also wish to consult an attorney.
 

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