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Required to Pay Insurance in Escrow?

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sixtos

Junior Member
Hi,

I have a question. I bought a home 2 years ago "owner financed". He didn't pay off his existing loan, and this was understood at close of escrow. He would pay off when we paid him off. Since he had an existing loan on the property, he had to maintain his insurance. He has a 1031 Exchange company handling all my payments and tax impounds. Nothing was ever mentioned about requiring me to buy my own insurance policies, although I know it would have been smart, but I didn't.

Anyway, now we are paying off the loan and on the pay off demand, it included 960.00 fire insurance and 1400.00 earthquake insurance costs on the damand. I wrote them a letter of compaint, and they sent the title company a revised demand by taking off the earthquake insurance, but they refuse to take the fire insurance off. Do I have to pay for this insurance that wasn't even in my name? Incidently, a few months ago I had a major roof leak and I called this 1031 exchange company to ask if I was included in the insurance policy on this home, because I have suffered a loss. They never returned my calls, so I assumed I wasn't. I'm confused. I called them to complain and they said if I can prove I have my own insurance on this property, they will take the cost off the demand. Shouldn't they have notified me ahead of time that they were going to charge me for insurance if I didn't get myown. and, if they did charge me, than they needed to impose an insurance police IN MY NAME.

Laura
 
Last edited:


efflandt

Senior Member
What did your original papers from 2 years ago say about property insurance? Typically that should mention who to enter as Loss Payee for the policy, and that you will be charged for insurance if you do not provide proof of insurance.

But it is possible that proof of insurance purchased by a 3rd party would have raised questions with his loan company, and your whole deal (transferring his interest in property used for collateral) could have caused his loan to become immediately due in full. So maybe he did not mention it.

Did you request a copy of the policy they are charging you for?
--
Not in the legal profession, just a homeowner.
 

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