Major mortgage lenders are being sued for forcing homeowners into overpriced homeowners and hazard insurance when the borrowers own policies have lapsed. JP Morgan recently settled a force-placed insurance lawsuit for $300 million.
Force-Placed Insurance Overview
What is force-placed insurance?
Force-placed insurance is hazard insurance a mortgage servicer obtains on behalf of a borrower. Essentially, when a borrower’s insurance policy lapses, whether due non-payment, simple error or otherwise, the mortgage lender will “force-place” a new policy on the property in order to protect... Read More