What to do about an unreleased insurance proceeds?
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What to do about an unreleased insurance proceeds?
Within the past few months, our home suffered wind and ice damage. Our insurance company inspected the damages, made the assessment, and wrote us a check. More damage happened in the interim, and another check was cut. Now, about 65-70% of the work is done but our mortgage company will not release the check to use until 95% of the work is done. Our contractor needs the remaining money to buy the supplies. The mortgage company says that the contractor should go on faith, but the mortgage company does not have a good track record for endorsing checks for insurance, so my contractor, rightly, does not want to get stuck with the bill and we do not have the money to pay him from our own pocket. Can they hold our check legally?
Asked on April 16, 2014 under Real Estate Law, Ohio
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 9 years ago | Contributor
I suggest that you consult with an attorney in your locality that knows law in the area of contract to assist you. What your mortgage company is doing is improper. There should be an escrow account to secure money and pay out the contractor in installments as the work is done. Such an attorney can be found on attorneypages.com.
Your contractor needs to come to bat with you against the mortgage company
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