Forced-place insurance is a racket
I had no idea this was going on. The practice of forcing placement of insurance coverage on a property, sometimes for more than the lender’s stake, then recouping the cost at the end is shady to me.
Later, with the help of a legal-services lawyer, Ms. Burton learned that the insurer, a subsidiary of Assurant, had issued coverage for the full replacement value of her house, $187,000, instead of the lender’s stake, just $55,000, that it was contractually entitled to.
“Their overpriced coverage caused me to experience a significant escrow shortage and is one of the reasons I fell so far behind,” said Ms. Burton, who is still trying to renegotiate her loan.