What could my mortgage company do to me if I refused to pay my home owners insurance.
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Written by
Jeffrey Johnson
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UPDATED: Jan 6, 2011
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Insurance Question from Fontainebleau, MS
Asked on 01/06/2011
What could my mortgage company do to me if I refused to pay my home owners insurance. NULL
Answer given on January 06, 2011
As a part of your mortgage you are required to carry homeowner insurance. If you let your homeowner policy lapse for non payment, the mortgage company has the right to place insurance with a company that they use and charge you for the premium.
If the mortgage company places insurance on your behalf, the premium is almost always 2 to 3 times the cost of the policy that you can obtain on your own. If you are unhappy with the cost of your insurance, you should shop around until you find an acceptable replacement. I do not recommend that you let the insurance lapse.
The mortgage company can also amend your loan to require that the insurance be in an impound account. this is an account that the mortgage company maintains, they charge you in your mortgage payment and then they pay the insurance company for the policy.
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