by Joed2999 » Sun Jan 27, 2013 12:43 am
After the insurance adjuster took a report of the damage to my house, he said I could start the repairs. I self repaired 50% of the damage; rip out, Sheetrock, spackle, paint, molding doors and a new bathroom. I hired licensed subcontractors; plumber for boiler, electrician, a/c guy and roofer. Three months later I went to get the insurance check endorsed by the mortgage co. They informed me self repair was NOT allowed and all work must be done by a licensed contractor. I had no idea this was a law. I don't think I was alone b/c not one person I know knew this and the whole south shore of Long Island was destroyed. Now the mortgage co. wont release my money for the self repair part. Now what? What happened to my money? Do I have any recourse? Keep in mind I did the self repairs b/c I was not given enough money to hire a contractor to do all the necessary repairs. I need advise please....Thank you
Posted: Sun Jan 27, 2013 01:35 am Post Subject:
Off the top of my head, what about seeing if a licensed contractor will inspect the work for you and certify that it was done correctly. Might cost you a hundred dollars or so. I'd ask your mortgage company about this first.
You could also ask where in your mortgage agreement is states that a licensed contractor needs to perform the work and push the issue with the mortgage company. Also ask them if they expect you to rip out everything and start over? Certainly that would be unreasonable. Push the issue up the ladder.
Posted: Mon Jan 28, 2013 07:41 am Post Subject:
I had no idea this was a law.
It's not, unless specifically mentioned in your agreement or the policy. Check out the terms of your policy with the agent.
Lenders can hold back the money during the repair or restoration period (they have their interest in the property). But they need to disburse the money as a single payment or as a series of payments, after completion of the work.
Discuss it out with the mortgage company as well. They can't hold back the insurance money to pay off the mortgage.
You'll need to be persistent through and through.
Posted: Mon Jan 28, 2013 09:51 am Post Subject:
Check out the terms of your policy with the agent.
It almost certainly is NOT discussed at all in the homeowner's insurance policy.Discuss it out with the mortgage company as well. They can't hold back the insurance money to pay off the mortgage.
Untrue. This could very well be a provision in the LOAN CONTRACT (not an insurance matter at all), giving the lender the legal right to withhold its endorsement of the claim check until a licensed contractor certifies the quality of the repairs.
tcope is correct. It would not be reasonable for the lender to require the work to be done over if the workmanship is satisfactory. Obtaining a written certification of the workmanship by a licensed contractor should satisfy the insurance company's requirements, if any. If there are no such provisions in the contract, then the lender has no basis for withholding its endorsement and exposes itself to civil litigation for breach of contract, which, in the right courtroom and with the right attorney, could result in the OP's mortgage being done away with. Title free and clear of any indebtedness.
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