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#2184802 - 07/10/18 07:55 PM Force Place Hazard Insurance Service Fee
JacksTigger Offline
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JacksTigger
Joined: Jan 2010
Posts: 260
lost in compliance land
Bank charges a fee when it is required to force place hazard insurance for a borrower. Borrower provides proof of new coverage and Bank refund premiums for overlapping coverage. Is the Bank required to refund the service fee in these instances?

1. Insurance expires on 03/01/18, we go through the process of the letters requesting insurance. Bank obtains force placed insurance stating on 03/01/18 and charges a fee. Borrower obtains their own hazard insurance effective 03/01/18. Coverage provided by the borrower is continuous.

2. Insurance expires on 03/01/18, we go through the process of the letters requesting insurance. Bank obtains force placed insurance stating on 03/01/18 and charges a fee. Borrower obtains their own hazard insurance effective 07/01/18. There is a gap in coverage provided by the borrower.

The question is related to RESPA 1024.37(g)

thanks for you time
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RESPA
#2185027 - 07/11/18 08:40 PM Re: Force Place Hazard Insurance Service Fee JacksTigger
JacksTigger Offline
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JacksTigger
Joined: Jan 2010
Posts: 260
lost in compliance land
bump

anyone have an opinion??
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#2185051 - 07/12/18 08:23 AM Re: Force Place Hazard Insurance Service Fee JacksTigger
rlcarey Online
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rlcarey
Joined: Jul 2001
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Galveston, TX
1. No - since there was no gap, you put them back to where they were with no fee allowed.
2. Yes - as there was actually a period of time when the force placed insurance was effective.
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#2185102 - 07/12/18 02:25 PM Re: Force Place Hazard Insurance Service Fee JacksTigger
JacksTigger Offline
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JacksTigger
Joined: Jan 2010
Posts: 260
lost in compliance land
Thanks, We were leaning to the same conclusion, but wanted to hear other opinions.
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