Suntrust Mortgage forced insurance?

Question

Every mortgage company (in FL) requires that the borrower have homeowner's insurance. If you do not purchase it youself at the time of your purchasing the home the mortgage company chooses one for you and your account is escrowed.
Does anyone know the name of the mortgage company that Suntrust Bank currently defaults their borrowers to if the borrower does not provide proof of insurance soon after the closing?
ANY input would be helpful. This info is no where to be found on their websites and I would rather not call the Suntrust Mortgage Company at this time.

and yes, I know its a nationwide req. i just thought it might be helpful to know that i am in FL... if there is any slight differences

Answer 1

There are several outfits that write a blanket mortgage impairment policy (what you're talking about). The problem is, it can change from year to year. It doesn't work quite the way I think you think it works - "your account" doesn't get "defaulted" to another insurance company for coverage.

What happens is, each bank has a BLANKET policy, that covers ALL the properties they have, UP TO THE MORTGAGE BALANCE, that don't show the current insurance. Every month, the bank sends to their insurance company a "schedule" showing each property address, and the mortgage balance (insured amount). The premium is updated MONTHLY, and the bank pays MONTHLY.

The coverage isn't anything YOU the HOMEOWNER will EVER collect under, or see. It's a private transaction, between the bank and their insurance company. It doesn't cover YOU, it won't ever cover YOU. If your house burns down, it will pay THE BANK, not you. It won't fix your house - and the bank can STILL come after you attaching assets, wages, etc, for the unpaid loan amount.

This is the way "mortgage impairment" coverage works. So it doesn't MATTER what the name of the company is, because they won't ever talk to you, and you can't file a claim, or collect - you are NOT an interested party - it's the BANK'S insurance, covering THEIR FINANCIAL INTEREST in your house. That's it.

Answer 2

Did you ever get an escrow disclosure sheet? The mortgage company is obligated by law to tell you once a year what they paid and who they paid. The insurance company is also obliged to send you paperwork informing you what you are paying, the limits of coverage and so on. Did you ever get this? The name of the insurance company should be prominently displayed on this paperwork.

You could perhaps find out by calling the Insurance Commissioner (Office of Insurance Regulation):

http://www.floir.com/

BTW the requirement that you mention is not just in Florida, it's nationwide.

Answer 3

The reason you paid PMI is you did not have 20%to put into the house and wanted the house right now If you stopped making payment they would still take your home When home values stop going up 20 % a year y'all gave up Next time save your money and put 20% down You toke a chance and lost It is no ones fault nor to blame on this The PMI is to protect the bank not you they only pay that when YOU stop making payments and they foreclose Bet a year or so ago you were telling all your friends how rich and smart you were This should demonstrate to us all not all people should own a home many need to be more responsible with their money

Answer 4

dollars to donut holes the chosen insurance company is a subsidiary of SunTrust's parent corporation.

I'd also bet big sums that its rates are unregulated and higher than those of Citizen's.

It is also possible and legal that if you can not produce an insurance binder at the time of closing that SunTrust will be excused from lending you the money -- and then the purchase will fail.

That doesn't mean you can use this as an escape from your purchase contract ... seller can still sue you for damages and/or specific performance.


oh

Answer 5

If you call the bank...they are required to tell you...every mortgage company can use a different insurance company...