By Anessa V. Cohen
Anyone owning stock in the paper industry must be making money like a bandit. With constant paperwork required after Storm Sandy to even get credit for simple things like buying a box of nails, everything comes down to paperwork. Paperwork and filing has been taking up the lion’s share of everyone’s day since October 29. The only thing that comes in a close second to writing, reading, and filing paperwork is sitting on the telephone.
To call an insurance company, mortgage company, government agency, or any of the utilities—whether it be LIPA, National Grid, Verizon, Cablevision, or the water company, you sit on the telephone punching option buttons, trying to reach and talk to a live human being. While holding, you may then be disconnected and have to start all over again or continue to hold as the announcement that you are getting lower on the wait list line rumbles out every few minutes over the phone. Unless you leave it on speaker while you walk around and do other things, you can waste days at a time just holding and waiting.
Sound familiar? This is one of those cases where you wish it didn’t. For over two months, this has been one of the main activities of the day for all those having to deal with flood and storm damage in order to work out solutions for repairs with all these different agencies. I finally thought that this was winding down and we were getting to the point when we were just left with negotiating with the insurance companies or waiting for them to send the claim checks so we could start effecting repairs necessary to bring our homes back to normal again. Now the newest insult to injury has started to play out.
Some mortgage banks have decided that people have not suffered enough with all this storm damage and chasing all over the place to arrange what was necessary to fix their homes, and have brought a new torture to the game table.
Since the insurance companies must have the mortgage banks listed on the insurance policies as well as the homeowners as interested parties, when some of the claim checks are sent to the homeowners, the insurance companies are making out the checks to the homeowners and the mortgage companies together.
When the homeowner goes to the bank to get someone to sign off on the check so he can deposit it and begin working on his home, the mortgage banks are giving the homeowners flack regarding the checks and not allowing them to be deposited in the homeowner’s account that readily.
Originally, when some homeowners received an advance from the insurance companies to help them get started on repairs, you went to the bank holding your mortgage to request an endorsement of the check to get yourself started. Instead of being helpful, some of these lenders would insist on all kinds of documents from the insurance companies showing the extent of the damages listed and the breakdown of items—aka Loss Claim Affidavit. They would then fax the Loss Claim Affidavit to their headquarter’s office to be reviewed. If the office signed off on it, they would allow the homeowner to deposit the check from the insurance company.
This in itself was a difficult and controlling experience. Now fast forward to actually receiving the final insurance checks after all you have gone through. You take the check to the bank only to find that the mortgage company has put on a new twist to the entire adventure. The mortgage bank now hands you a new sheaf of papers to fill out, all giving them permission to deposit whatever monies you have received from the insurance company into an escrow account held and controlled by them, with the added request that you start sending them all the signed estimates you receive from contractors towards the repair of your home. Then if this is not bad enough, they want the ability to send inspectors to check the work and report back to them prior to agreeing to any monies being released to pay your contractors.
Are they really allowed to do this? I don’t know. I would imagine if a house were condemned and totaled, this might be something they would want to consider. But in terms of repairs, this is just going to be an additional wall being erected preventing homeowners from getting their houses back into shape quickly and efficiently. The control they are looking to have is so ugly, I cannot even imagine how this was agreed to by the supervising entities of the banking industry.
Given the huge demand on all the contractors out there, how many are going to be willing to do work in places where they must wait for all these inspections to be done? The money has to be released from the mortgage banks. The mortgage banks are not even saying that they will agree to pay these contractors, even after an inspection, if they even agree to the repairs and terms as contracted between the homeowner and the contractor.
This is an important issue, folks. You have got to start calling your governor as well as our congressmen and senators to get on top of these banks immediately. Something has to be done, or getting past Sandy will never be over at this rate! v
Anessa Cohen lives in Cedarhurst and is a licensed real-estate broker and a licensed N.Y.S. mortgage broker with over 20 years of experience, offering full-service residential and commercial real-estate services (Anessa V Cohen Realty) and mortgaging services (First Meridian Mortgage) in the Five Towns and throughout the tri-state area. She can be reached at 516-569-5007 or via her website, www.AVCrealty.com. Readers are encouraged to send questions or comments to anessa.cohen@AVCrealty.com.