Are Servicers Allowed to Charge a Borrower for Force-Placed Insurance Coverage?
In general, servicers are not allowed to charge you for force-placed insurance coverage, unless the servicing company has a reasonable basis to determine that you have failed to maintain hazard insurance and has duly notified you about this situation.
According to the current regulations, a servicer has to provide you with two notices. First, the servicer should send you an initial notice at least 45 days before charging you for the force-placed insurance coverage. If you fail to respond, the servicer must send you a second reminder no earlier than 30 days after the first notice and at least 15 days before charging you for the force-placed insurance coverage. Charges related to force-placed insurance are regulated, as these charges must be incurred for a service that was actually performed, and must bear a reasonable relationship to the servicing company's cost of providing this service.
- What Is Predatory Mortgage Servicing?
- What Are the Specific Formal Requirements for Periodic Statements?
- What Are Coupon Books and When Can They Replace Periodic Statements?
- When Are Servicers Allowed to Stop Providing Periodic Statements or Coupon Books?
- How Are Periodic Statements Delivered?
- What Is the Rule on Interest Rate Adjustment Notices?
- When Should I Receive an Interest Rate Adjustment Notice?
- What Information Must Be Included in the Initial and Ongoing Interest Rate Adjustment Notices?
- What Is the Prompt Payment Crediting Rule for Servicing Companies?
- What Are the Prompt Payment Crediting and Payoff Statement Rules for Servicers?
- Can the Loan Servicer Refuse to Provide You with a Payoff Balance Statement within 7 Days?
- Can I Choose My Mortgage Servicing Company?
- Are There Any Rules Regarding Written Communication with Servicing Companies?
- What Are the General Rules Regarding Servicing Policies, Procedures, and Requirements?
- Are There Any Special Rules for Servicers When Dealing with Delinquent Borrowers?
- What Is the "Successors in Interest Rule" for Servicing Companies?
- How Should I Inform Servicers When I Become a Successor in Interest?
- Am I Liable for the Loan Once Confirmed as a Successor in Interest?
- Can I Change My Mortgage Servicing Company?
- Can I Turn to a Government Agency to Complain Against a Mortgage Servicing Company?
- Are There Any Federal Laws Protecting Me from Mortgage Servicers?
- What Are the Mortgage Servicing Rules Issued by the Consumer Financial Protection Bureau?
- What Is the Periodic Statement Rule for Mortgage Servicers?
- Are There Any Exceptions to the Periodic Statement Rule?
- How Many Periodic Statements Am I Entitled to Receive?