More from our That Ticking Sound series (use the search term "ticking" in the keyword search box on the right hand side for other postings on insurance issues) . . . .
Back in the "good old days" when foreclosed and REO property was promptly sold, it was all too easy for lenders and servicers to ignore problems with a borrower’s insurance. Sadly, those days are gone, and to cope with today’s new world, lenders and servicers now must understand how insurance works and how the coverage in the policies obtained by borrowers and by lenders or servicers themselves does – and sometimes doesn’t – provide protection.
The focus on insurance coverages needs to start early in the surveillance process, and most certainly as the deal heads toward the ditch.
To assist lenders and servicers in understanding insurance, I attach (as a PDF) part one of "Insurance for Lenders and Servicers; Part One (Insurance Basics; Insurance for Property)." In coming months, I’ll post future portions (or parts) as I complete other parts of this new resource guide.
If you have specific insurance topics for me to cover, or questions based upon Part One, please post a comment below.