Replies to This Discussion

Permalink Reply by Tni LeBlanc (805) 878-9879 on March 13, 2011 at 12:24pm

I'm curious to see the answer on this.  Was it their home insurance that paid for the roof repair? 

 

 I have a CHASE short sale that needs a new roof to be sold as well.

Permalink Reply by Alan Remigio on March 13, 2011 at 2:06pm

Don't wait, escalate. Have seller hold check. It must be stated that insurance monies is to pay for roof repair specifically. Make sure seller's lender agrees to it. Any acknowledgment by the lender must be in writing. Do not send check to Chase/WAMU, yet.

Ask buyer's lender if they will allow the roof to be repaired after close. Show them the insurance check and ask them if they can put part of the proceeds from the pending loan in the amount of the insurance check in escrow with closer as a "cost to cure" with instructions that it be spent exclusively on the roof. The insurance check can now be a part of the proceeds to Chase/WAMU. At closing, have seller bring check to table and sign. You must have agreement from the seller's lender and ask that the instructions( re:insurance check) be part of the approval letter. Make sure your title person knows how to do this since the check must probably be overnighted to lender. You have to monitor this and make sure your instructions are followed.

Here's the killer. I've seen several short sales fall through with an insurance claim check in the seller's hand and the property went to foreclosure sale. The check now becomes his problem to resolve. In the cases I was aware of, the insurance company rsimply rewrote the check and the seller took the proceeds.

Permalink Reply by Bill Iannelli on March 13, 2011 at 4:44pm

Yes it was homeowner insurance

Tni LeBlanc said:

I'm curious to see the answer on this.  Was it their home insurance that paid for the roof repair? 

 

 I have a CHASE short sale that needs a new roof to be sold as well.

Permalink Reply by Bill Iannelli on March 13, 2011 at 4:46pm

Thanks Alan, will let you know what happens.  Good stuff

Alan Remigio said:

Don't wait, escalate. Have seller hold check. It must be stated that insurance monies is to pay for roof repair specifically. Make sure seller's lender agrees to it. Any acknowledgment by the lender must be in writing. Do not send check to Chase/WAMU, yet.

Ask buyer's lender if they will allow the roof to be repaired after close. Show them the insurance check and ask them if they can put part of the proceeds from the pending loan in the amount of the insurance check in escrow with closer as a "cost to cure" with instructions that it be spent exclusively on the roof. The insurance check can now be a part of the proceeds to Chase/WAMU. At closing, have seller bring check to table and sign. You must have agreement from the seller's lender and ask that the instructions( re:insurance check) be part of the approval letter. Make sure your title person knows how to do this since the check must probably be overnighted to lender. You have to monitor this and make sure your instructions are followed.

Here's the killer. I've seen several short sales fall through with an insurance claim check in the seller's hand and the property went to foreclosure sale. The check now becomes his problem to resolve. In the cases I was aware of, the insurance company rsimply rewrote the check and the seller took the proceeds.

Permalink Reply by Bill Iannelli on March 15, 2011 at 4:49am

Here is what the bank does with regard to the roof check.  They have a loss drafts department.  The seller fills out paperwork at a website.  The check is sent to the banks lost draft department along with a bill from the roofer.  The bank will then send two checks back to the seller made payable to seller and roofer.  50% down to get started and the other 50% upon completion.  The seller has a notarized form stating he will pay the roofer.  Will let you know how it goes. 

Bill Iannelli said:

Thanks Alan, will let you know what happens.  Good stuff

Alan Remigio said:

Don't wait, escalate. Have seller hold check. It must be stated that insurance monies is to pay for roof repair specifically. Make sure seller's lender agrees to it. Any acknowledgment by the lender must be in writing. Do not send check to Chase/WAMU, yet.

Ask buyer's lender if they will allow the roof to be repaired after close. Show them the insurance check and ask them if they can put part of the proceeds from the pending loan in the amount of the insurance check in escrow with closer as a "cost to cure" with instructions that it be spent exclusively on the roof. The insurance check can now be a part of the proceeds to Chase/WAMU. At closing, have seller bring check to table and sign. You must have agreement from the seller's lender and ask that the instructions( re:insurance check) be part of the approval letter. Make sure your title person knows how to do this since the check must probably be overnighted to lender. You have to monitor this and make sure your instructions are followed.

Here's the killer. I've seen several short sales fall through with an insurance claim check in the seller's hand and the property went to foreclosure sale. The check now becomes his problem to resolve. In the cases I was aware of, the insurance company rsimply rewrote the check and the seller took the proceeds.