“Both borrowers and the investors are the customers of the servicers,”
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“In what other industry do companies treat the customers in this manner?”
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This is a HUGE reason for “manufactured foreclosures”. We see this one all the time. Many NACA attendees are victims of forced placed insurance. There is a big story here on how both the homeowners and the investors are the marks for yet another banking industry tainted product.
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Losses from Force-Placed Insurance Are Beginning to Rankle Investors
Before servicers force-place insurance, they often warn homeowners that the policy is costly, offers poor coverage and is likely to benefit the servicer. The investors who often end up paying for that same policy don’t benefit from the same notice.
They may be catching on all the same. Recent rumblings suggest mortgage investors may soon begin to challenge widespread servicing practices related to force-placed insurance.
Inattentiveness to servicing minutiae cost investors little during the housing boom, when rising property values allowed servicers to charge borrowers high delinquency-related fees while still recouping investors’ full principal through refinancings and foreclosure sales.
But the torrent of borrower defaults after the bubble burst has changed the stakes. Because servicers repay themselves for the cost of force-placed insurance with part of the proceeds of foreclosure sales, investors end up paying for the pricey policies through greater loss severities.
At a mortgage backed security investor conference last month, Amherst Securities analyst Laurie Goodman argued that Bank of America’s ownership of a force-placed insurer, Balboa Insurance, had contributed to the bank’s torpor in clearing out hopelessly delinquent loans. The delay added up to taking money from investors’ pockets, she said. “Bank of America force-places insurance at a much higher rate than market rate,” Goodman told a crowd composed largely of investors. “It would make sense that [it] would be much slower to liquidate, and in fact they are.”
Force-placed insurance is one of numerous areas in which investor and homeowner interests are aligned…
Rest here…
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FPI scams, and illegal FPI abuses are rampant in the last year. The worst two ultra corrupt as in *illegal* entities I have researched are Wells Fargo and the infamous Balboa Insurance.
Ed Cage
THEY FORCE PLACED INSURANCE ON CREDIT CARDS ALSO, SO WHEN I STOPPED PAYING MYCREDIT CARD TO MAKE SURE MY HOME WAS PAID , THOSE CREDIT CARDS GOT THEIR MONEY BECA– USE THEY ARE THE ONES WHO PUT IT ON THE CARD. SO WHY ARE THEY STILL HARASSING ME FOR MONEY?WHY? BECA– USE THEYDONT, THEY SELL IT TO THEIVING ATTORNIES WHO THEN SEND OUT FAKECOURT DOCUMENTS THAT YOU HAVE TO ATTEND OUR THEY ARE GOING TO PUT YOU IN JAIL.
DEBTOR JAILS
DOnt be fooled by all this…they all owned the forced insurance companies for their self gain…they do not need to pay higher costs…I found out myself…they take out group insurance which is a much lower cost and then insure your property for more than twice the balance of the mortgage amount which I understand is not kosher…
So, the servicers are also the owners /investors and also the trustees and the list goes on…so now they will want a bailout on this too…with more tax dollars…
Detusche Bank I believe may be violating the antitrust laws…the owners of the forced [laced insurance are owned by these large banks…so the money trail ends in once big pocket…DB now ownes GMAC and Ocean Bank and Ocean Bank supposedly owns Homecomings, a GMAC company owned by DB ..DB keeps the names of those enbtities for years I believe to deceive and to violate the anti trust laws…there are so many aspects to the fraud and crookedness that the foreclosures are exposing…am sure they are regretting going that route to recapture more funds from the home owners…but too late…Panderos Box has been properly opened…just be vigilant regarding what else comes out of it…
Bailing out the insurance with the stimulus was also a huge scam/sham/ brilliant strategy…
Take a closer look at who owned the forced insurance companies besides Bank of America…happy hunting…
I still say that the Title Companies are our best bet to make our points.
No one will want to buy your home after foreclosure if they can’t get a clear title to it.
In order for a clear title to be issued, the Title Insurance Company will want the same documentation we are asking for and not getting.
Time is on our side as the houses we are kicked out of sit empty the theft and destruction that will go on will be such a loss that no insurance company will insure that kind of loss for long. The losses of equity will be tremendous.
Better to leave all us that have paid on time alone and we can start paying again when the economy gets back to normal and we are working again.
MY QUESTION IS WHY ARETHESE INSURANCE COMPAINIES PAYING THESE FRAUDULANT CLAIMS?
“They” can also force place wind insurance, when the only place to purchase wind insurance, for myself personally, is Citizens. No other insurance company will insure me. I have no options.
No competition and no options.
SCAM.