Your home has been damaged by a tornado, flood, a tree fell on it in the recent Hurricane. Or as in my case when Mrs. Cobos left the water in the upstairs bathroom running and flooded the second floor causing water to seep through to the ceiling below.
Storm Damage from April 16th Tornado in Raleigh
You’ve settled your claim with your home owners insurance agent and you have an insurance settlement check but it’s made out to you and your mortgage company;
How do you cash your Homeowners Insurance Claims Check to Pay for the Repairs?
Since the storms that rampaged across the country in April and May I have received numerous calls from customers of the bank where I work requesting assistance processing insurance claims checks in order to pay for storm damages to be repaired. Hence this post for those who have questions about the process.
Insurance Claim Settlement Check are made payable to all Interested Parties
Even the Mortgage Company(ies) and former spouses, lovers, flings, brothers, sisters, daughters, sons, aunts and uncles who may be in title.
Insurance drafts are made payable to all the owners and first lien holders who are in title (the bank) and so they require approval of ALL named insured before they can be cashed [even ex-spouses and former jilted lovers who may still be in title].
Because these customers chose to hire individual contractors and repairmen instead of using a certified Restoration Company who could have billed the insurance company directly, they need to cash the checks in order to pay for the repairs. The simple truth here is that most of the people who are doing the repairs are out of work contractors who are no longer building homes and do not have the money to fund the cost of materials and in most cases need a “draw” to by materials and most lenders will not advance or front any upfront costs and will only disburse for work completed.
Hurricane Irene: Insurance nightmare awaits homeowners
If your Insurance claim is less than $10,000
If your home has sustained storm damage and the damages are less than $10,000 your local bank branch (if they are your mortgage lender) or mortgage branch office can assist you with their cashing procedures but for larger claims they will require proof of repairs and will likely hold those monies in escrow until proof the work has been completed [not unlike a mini construction loan project] is obtained and affidavits sworn out. However is if you elected to use a certified restoration company who will bill your insurance company directly and save you these steps.
If your Insurance Claim Check is more than $10,000
In the case of larger damage claims, the lender may allow a small upfront draw or disbursement for the contractors to buy materials. After that, they will only pay for work completed a safeguard to ensure that the work is completed. The final draw is generally withheld until a final affidavit and sworn statement from the homeowner is provided that the work has been done according to the agreement and homeowners satisfaction.
Related articles
- Why Can My Mortgage Company Hold My Insurance Claim Check?(theraleighmortgageguy.com)
- Texas Bill Targets Crooked Roofing Contractors (DallasNews.com)
- Restoration Company vs. Contractor/Repairman – 5 things to consider (theraleighmortgageguy.com)
- 5 Things to Consider before choosing a company to restore your home after a catastrophe: (theraleighmortgageguy.com)
- Homeowners Consumer Center Offers to Help Alabama & Mississippi Homeowners or Business Owners if They Were Denied Insurance Coverage (prweb.com)
- HELP FOR HOMEOWNERS – HARP extended thru 2012 (theraleighmortgageguy.com)
- Homeowners: Beware of post-Irene scams (hsh.com)
- NJ Insurance Claims And Public Adjusters – Where’s the Benefit? (insuredirect.com)
Related articles
- Homeowners: Beware of post-Irene scams (hsh.com)
- NJ Insurance Claims And Public Adjusters – Where’s the Benefit? (insuredirect.com)
