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Old 04-02-2015, 07:52 AM
19 posts, read 63,069 times
Reputation: 56


We filed an insurance claim in August 2014. The insurance company, due to the total amount of damages, made the check out to both me and the loan servicer. The loan servicer put the funds in restricted escrow. We went through their processes to get repairs scheduled and the funds released. So far so good.

The repairs completed in February 2015, and the loan servicer's inspections passed, so all remaining funds were released. However, the insurance company made an additional payment post-inspection for the full replacement value of the incurred damage. This additional payment was deposited by the loan servicer in restricted escrow in March 2015.

At the same time, we refinanced the loan with a new lender, which closed in March 2015. I am having a hard time getting the additional insurance-related payout returned to us. The regular escrow account already was refunded to us, but no such luck with the remaining insurance funds. I called the old loan servicer, and at first no one wanted to take responsibility. I was very insistent, and finally the customer service rep said that she would email her supervisor for follow-up. I am not holding my breath.

What would be a recommended course of action for follow-up? Send in a qualified written request? What other options are there to escalate the matter?
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Old 04-02-2015, 10:47 AM
Location: New York
2,251 posts, read 4,160,232 times
Reputation: 1607
Since the insurance refund was to both you and old loan servicer. You are going to deal with the previous bank.

The best thing you can do is finding out name and address of supervisor, sending letter via registered mail (a few bucks at the post office). Be polite do not over dramatize your situation. Describe the what is happening sticking to the facts, in closing typing a "Respond-By" date to avoid legal litigation.

If they don't respond - if the amount is less than $5000, you can go the your county court house and sue the old servicer in small claims court. This involves sending a 30 day demand letter, before your case goes before a judge. Time frame 3 months to 6 months depending how busy the court house is.

If over $5000, contact a local attorney to file suit in civil court. Chances are you are going to pay the attorney upfront. Time frame includes discovery and filing motion before the court. It can be up to a year before your case goes to trail.

Last edited by Modification Specialist; 04-02-2015 at 11:04 AM..
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