Your Mortgage Company is on Your Insurance Loss Check - YouTube

Asheville and Knoxville thank you guys so much for checking out our page in our

video series here on a resources tab of litespeedconstruction.com this page

is kind of designed for anybody who's ever had to deal with having a mortgage

company listed as a payee on an insurance check and it's a big big pain

really what we can tell you is that as a general rule that's gonna add between

one and two additional months on any restoration project

my company Litespeed focuses on roofs and so for the purpose of our discussion

we'll primarily zero in on what might occur during a roofing project so I

guess let's get right to it guys on our page here when your mortgage companies

listed on your insurance check the 10 sets to dealing with your mortgage

company's loss trap department will probably keep it at 10 you could

actually mention a few more but really I think you have to set the backdrop

several different things are occurring with your insurance company and with

your mortgage company the same time first thing that's gonna occur with your

insurance company is that you've gotten to loss and there's an adjuster that's

come out to your property adjusters going to come out there and in many

instances that adjuster can alert a homeowner or your contractor as to

whether or not your mortgage company might actually be listed as a payee on

the insurance check so as that insurance adjusters out he might actually be able

to give you guys a heads-up whether this particular loss value which is going to

be your mortgage company's criteria the amount of money that your insurance

company is actually paying you for the loss to fix the damages if that loss is

actually above a certain amount usually here ten thousand dollars so if you get

ten thousand on a hundred dollars mortgage company would be actually

listed on your check if it's not thousand nine hundred and ninety five

dollars they wouldn't a big reason for this is that your mortgage companies the

lien holder on your home and thus they have a vested interest in saying that

that property gets restored back to us appropriate and original condition what

you really have to understand is that during the adjustment phase you will

typically end up with a supplement

Fay's so your insurance company has provided an estimate most of time a

roofing contractor will come back and say well this isn't really going to be

code compliance we really need to take a look at these other items

take a look that process can oftentimes take one month supplement process is

what you want to complete before you ever start construction and for up to

the supplements done you can actually construct needless to say that maybe

could take one week between getting authorization to an approval from your

insurance company to move forward with a final payment type schedule once that

constructions actually performed you will be providing a certificate of

completion to get a final payment and what you need to keep in mind is there's

a first amount usually around half the money is released here the supplements

agreed to and you might increase that value say by 40% so now you've got the

first half of the money plus 40% more that your supplement would have been

added so you've actually got one half plus forty percent money that's left

behind to collect where this process can get confusing in my opinion is that the

mortgage company is going to want that initial paperwork so they're going to

want the amount that was originally agreed to so that let's just call it

$10,000

what gets confusing is that most contractors are going to take a look at

a supplemental type process so that the mount is actually increased from $10,000

to $14,000 to bring your home up to code compliance to add all components that

were actually damaged and to be paid fair wages on the property you go from

$10,000 to $14,000 that's a standard thing to see

so the in problem is the insurance company is not aware that there's 4,000

additional dollars this is where you start to take a look at the steps one of

the things you'll need to do is release your initial paperwork your initial

comments on your contractor and your contractor is probably going to take it

over from there that glance at our notes here that's actually going to be item

number four your contractor is going to need to be prepared to step in provide a

lien release a preliminary limit lien release is w not insurance contractor's

license and possibly some other things depending on the mortgage company in the

law strap packet that they require so if you'll take a look at list item number

four on our page here it actually gives you some beta on what you need to expect

your contractor to be able to provide to get that first endorsement so this

$10,000 what you probably actually have is half of your $10,000 to start off

with so you know I have ten thousand bucks

you've got five thousand dollars to get the job started and what happens if your

mortgage companies listed on this check sum we'll put an M out there because

your mortgage company is actually on that five thousand dollars what you will

have to do is satisfy several different criteria you'll have to have your

contractors selected they will have to provide their information to your

mortgage company as per discussion lien release the W non-insurance contractor's

license tax ID those types of items they're alyssum item number four and so

when you have a $5,000 check with the mortgage company listed on it you'll

have to provide that information along with the endorsed check so you actually

have to sign the back of the check with those other items and mail it to your

mortgage company of course get the permission from your mortgage company to

do so and find out exactly where to send that's very important but that would be

your expectation that you will be mailing this check off

and they will either mail it back to you or deposit it directly to your checking

account depending on whether or not you've met with your bank with your

mortgage company now what I can say is that this process right here probably

takes again close to a month you've got to get several different items in your

mails got to go it's got to come and normally it lags behind at least one

week but times between the time they say that they released at the time that

you're actually gonna get it in the meantime you've got a supplemental value

that you've been negotiating with with your insurance company so now you've got

not $10,000 you've got $14,000 that you're gonna be doing the work on and

that's the actual scope of money that you're going to be doing so while you're

waiting on your mortgage company to endorse that a first initial check what

would have occurred is you most likely would have been dealing with your

insurance company in a supplemental capacitor having your contractor do so

to try and get that amount corrected that again it's going to bring us from

that $10,000 by you to $14,000 value to make you whole so at this point you've

got to check in the mail you've got a supplement negotiation and you're

waiting there's two choices that we suggest considering one is wait until

you get a final check or a starter check to start work you can also take a look

at financing that first amount of money lights B construction offers financing

if that's more convenient but you can take a look at getting your contractor a

starter check through financing or just waiting until that that first $5,000

check comes back from the mail needless to say once you get that $5,000 checked

you're still owed approximately nine thousand dollars so you get this spot

thousand dollar check you've got nine grand left over and guess what that's

gonna have your mortgage company list does it pay you as well stepping back

through those same processes you're gonna get back in touch with your

mortgage company alert them that a supplement has occurred this supplement

that you've been working on for Oh maybe a month with your insurance company and

I say you would actually mean is you or your contractor so what what's

gonna occur with this $9,000 at this point you've probably got your roof

completed you may have other items say like gutters gutter guards even windows

or siding to do behind but really what that contractor is probably going to

want to do start scheduling those other jobs behind while it's turning in a

statement of substantial completion to the mortgage company depending on your

mortgage company Sullivan asks for half of the work to be done say for example a

roof some of them has four then after that

maybe 90% to be done to release the next funds but let's just say for our

purposes that you call the reason half of the work what they will actually do

is they will most likely release to you another third of that money so another

$5,000 check would be coming $5,000 more money getting deposited into your

account or mail to you as a check without you're gonna pay your contractor

as well at this point that contractors most likely done that next series of

work whether that be again gutters gutter guards windows whatever so you've

got this to pay them and usually what you will see them requiring is a

conditional lien release at this point because your contractor at this point is

probably pulled with a 90 percent of being done he's gotten the next siding

portion done or the next phase of construction done so you will see 90

percent of completion being done once this is percent okay so once this next

$5,000 is paid your contractor you've got a four thousand dollar outstanding

balance so with that four thousand dollar

outstanding balance you will actually most likely have to send a certificate

of completion to your insurance company to get that final monies so you as owner

will need to be prepared to sign a COC with your contractor and send that to

your insurance company at that point your insurance company would mail you

that final money because keep in mind they probably would owe you at this

point either 1/2 or 1/2 plus their portion so you need to get that

final monies from your insurance company so what we suggest is go ahead and sign

that COC send that over to your insurance company how'd that adjust your

call you because you've already agreed on the supplement lets you know that

money's in the mail you'll alert your mortgage company that you're waiting on

the final monies from your insurance company of course you're going to want

to let your mortgage company know that the value actually changed from the

original ten thousand dollar amount to fourteen thousand and that's what they

can expect to be endorsing so that final money has come to you and again it's got

your mortgage company listed as a payment the final four or five nine

thousand dollar check is in your possession what you will do of course is

endorse that mail that to your mortgage company once again mortgage company will

endorse it and mail it back to you so

knocks on Asheville what you guys are probably wondering after this nice weary

long explanation is what do we have here so what you have is going to zero you've

got your insurance company paying your the first half of the money plus a

possible 40 percent increase plus the final half so guys at the end of the day

your insurance company has paid you everything and there's a balance of zero

let's take a look over here because your mortgage company might still be holding

some funds so you've had a series of possibly two or three different

inspections with your mortgage company you've had several different lien

releases turned in and your mortgage company is ready to pay you final

balance they will need a COC at the end as well and after all this money has

been dispersed to you and you have paid it to your contractor it is going to

leave a balance of zero as well so that you have satisfied your mortgage

companies conditions and you have satisfied your insurance companies

conditions and you paid your contractor and you're an indemnified customer so

your mortgage companies on your insurance check good news for you guys

lights B construction is here to help that's the subtitle of this webpage give

us a call if we can Knoxville Asheville thank you guys so much for tuning in

hope this helped you all understand the mortgage and insurance

if your mortgage company happens to be list