Can my mortgage company charge me for 2 years of not having insurance when there were never any claims during that time?

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Can my mortgage company charge me for 2 years of not having insurance when there were never any claims during that time?

About 2 years ago I refinanced my mortgage and over the next 3 months or so, it was bought and sold 3 times to different companies. During that time, my insurance got dropped and we were without insurance for 2 years. I called my mortgage company about it and they said that they would install a lender placed policy. It is now forcing us to pay for the 2 years in back pay. There were no claims during that time. Can they do this if I just get my own insurance?

Asked on July 11, 2011 under Real Estate Law, Georgia

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Potentially your mortgage company can require you to pay insurance premiums for your home that you did not pay, but that it paid over the past two plus years.

Is this what happened?

A mortgage has terms (as well as a loan) requiring the property owner to protect the security with insurance and if not done, the mortgage company can pay the insurance that is not being paid and then charge you for what it paid to the insurance comany as premiums.

As a safeguard, you should ask your mortgage company for copies of the insurance policy it claims was placed on your property and all insurance payments it made. This will make sure you are not being taken advantage of. If insurance was placed on your property and payments made, you should reimburse your mortgage company for protecting your home.


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