Doesmy nsurerhave to have both my name and the mortgage company’s name on a damage claim check?

UPDATED: Apr 8, 2011

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Doesmy nsurerhave to have both my name and the mortgage company’s name on a damage claim check?

I filed a claim with my insurance company for damage to my home. The check was not made out to me only, why?

Asked on April 8, 2011 under Real Estate Law, Iowa


MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

This is normal when you have an existing mortgage on a home or any real property that has improvements on it. The insurance company must make it out essentially to the mortgagor and the mortgagee (because the mortgage has a security interest in the property). To do otherwise could cause the mortgagor to be in a position to take the money and run, not improve the property and essentially impact the value of the property if it turns into a foreclosure, especially in an anti-deficiency state. So, you need to have your mortgage company endorse the check and usually the mortgage company will do so when they know improvements are being made (a contract is signed and draws are given as the work is being done).

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