Investors are increasingly demanding servicers/special servicers file hazard insurance claims on REO properties regardless of whether they will be approved.
“More and more of our clients are asking to file a claim even though we know it will be denied because their investors are requiring [it],” Cheryl Lang, president and CEO, Integrated Mortgage Solutions, told this publication.
Investors “just want to make sure that they've gotten every penny out of that property that they can,” she said. “It doesn't affect their costs. They only get paid if the claim gets paid.”
It does challenge servicers/subservicers and insurance companies operationally in terms of cost, time and related statistics. But all parties are willing to do it for customer service reasons, said Lang.
“It kind of clogs things up, but that's the nature of the beast,” she said. “It's just the way things are now.”
