Fire during remodel, not occupied

[Brandon_tn]

So how much is the check compared to how much you owe and compared to how much it will cost to repair?

The check is for ~$160k, the loan bal is ~ $110k. So if the mort co takes the loan bal and gives me the the remaining amount i would have ~$50k to do with as i please. A reliable source says if i do the contracting myself I should be able to get the repairs done for 90k-100k.

One thing i am wondering is, if the mort co will disburse the 160k as mentioned will they require that i spend all of it on the house and if i dont will they apply it to the mort bal or can i keep what is left.

My thinking is that i wont have a choice bc when the mort co. realizes that in the ajuster's estimate the 160k isnt enough to do the repairs on the house they will require that the mort bal be paid due to the fact that the 160k might not be enough to get the loan collateral back to livable condition.

Brandon

 

[ecmst12]

I think you are going to have to be honest with the mortgage company and discuss with them that you feel you can get the repairs done with the amount of money given. If there's anything left over, you'll have to ask the company what they will do, but I think you are right that it will be applied to the loan balance. But that's not a bad thing, since ultimately it will get your loan paid off faster which means you'll pay less interest on it.

 

[Brandon_tn]

At this point its not a question of being honest. I think they would use the adjuster's opinion before they would use a guess by the homeowner. I dont have an estimate from a contractor yet. If they require that I use a contractor the cost will probably be over the coverage amount.

I did find out from the mort co website that if the insurance payout is more than the mortgage balance I have the option of paying off the loan and getting the remaining amount in cash.

 

[ecmst12]

You do have that option, though then you don't have enough to complete the repairs.

 

[RR Rodriguez]

I agree, I would hold enough to make sure I had enough to fix the house properly. and give the rest to the mortgage company, therefore lowering your mortgage considerably.


Its starting to sound like you may have accidentally burned the house on purpose.

 

[Brandon_tn]

Its starting to sound like you may have accidentally burned the house on purpose.

Of course anyone who looks at the situation logically would have the owner at the top of the list of possible causes of the fire. If I was on the outside looking in my first thought would be that the owner might have started the fire bc the work was taking much longer than originally planned and the house was to the point of having to spend larger amounts of money on it. And yes, when its all said and done I will probably come out ahead and the house will get finished sooner than before the fire. The simple answer to the obvious question is NO, I had nothing whatsoever to do with the cause of the fire but personally I believe it was arson. There were no obvious causes that I could determine. There was nothing being done in the area where it started and there was a small wooden yard tool shed against the house right were the fire apparently started. Not to mention the fact that a building in the lot directly behind my home burned to the ground about 2 months before my home burned.

If it was arson some might say I should say thank you to who ever started it but conversely now I am worried that it could happen again at any time, especially when my wife and I are living there. That’s why after the fire I installed 6 cameras, 5 motion alarms, 4 motion lights, 5 dusk to dawn lights and some other totally legal but extremely cool “deterrents” I wont reveal except to say that the internet has all kinds of cool ideas.

Brandon

 

[JKBee]

You should thank the gods that be that you got the check from the insurance company at all. I was on the jury for something similar when the insurance company would not pay. The insurance agent was being sued due to not giving out the proper information to the insurer.

We upheld the insurance agent. This was done on the fact that the agent filled out the forms, but it was up to the person buying the insurance to make sure that it was the correct policy. "You signed it, you bought it", was the jury's philosophy. The small print, in other words.

As you were so fortunate this time, please make sure that you do everything by the book in the future.

 

[moburkes]

FYI - I don't think the agent made a "huge" mistake when I see all the facts. Insurance companies do realize that most people who buy a house will not move into it the day after closing. Plus, the underwriting or free look period in most states is around 60 days. So if an inspection was performed and all else checks out (no hazards which would cause the company to WANT to cancel immediately), the insurance company would be okay with it being empty for a few months. Think about it - people buy one house but may have to sell the next. Undewriters are lenient if the agent is a good agent and the customer is upfront about it.

In this case the customer wasn't up front about it - but the agent doesn't check up on this stuff, and had no reason why he SHOULDN'T have believed the customer. BUT every HO3 I've ever read talks about the problem with vacancies, and that coverage is limited after 30 days. If this policy didn't mention the 30 day issue, that's why this claim was paid. Otherwise it made NO sense to pay it and the OP should be thankful it was paid.

 

[Brandon_tn]

1) I inquired with the insurance company about coverage for debris removal and they said it was only available if the entire structure was to be torn down.

Q-Does this sound correct?

At least 1/3 and possibly all of the roof rafters and decking will have to be torn down and replaced.


2) There were a few items that were damaged by the smoke or water from the fire department including the kitchen cabinets that had been removed from the kitchen but were still inside the house and the crawl space AC duct work.

Q-Are the kitchen cabinets and duct work considered to be part of the dwelling or could they be covered under the contents section.

Thanks again
Brandon

 

[moburkes]

1) I inquired with the insurance company about coverage for debris removal and they said it was only available if the entire structure was to be torn down.

Q-Does this sound correct?

At least 1/3 and possibly all of the roof rafters and decking will have to be torn down and replaced.


2) There were a few items that were damaged by the smoke or water from the fire department including the kitchen cabinets that had been removed from the kitchen but were still inside the house and the crawl space AC duct work.

Q-Are the kitchen cabinets and duct work considered to be part of the dwelling or could they be covered under the contents section.

Thanks again
Brandon

Both of those questions could be answered by reading your policy. Honestly, it's been so long since I've read one for those 2 issues, that I don't know off the top of my head. I'm going to say for most companies, things that are "attached" to your home (like kitchen cabinets, carpets, a/c units, etc) are usually considered part of the dwelling, and contents coverage is for things you physically bring into your home when you move in. But, again, your best bet is to review your policy for the answers.

 

[Banned_Princess]

Thanks for keeping it in one thread OP.

I'm glad you were able to work this out with the company.

the duct work is obviously part of the structure, or dwelling.

I thought you already got your policy limits.. If your trying to get more, and you didn't even live there, that is being greedy.


Plus, it is a good idea to ask your adjuster for policy specific answers.

 

[Brandon_tn]

I thought you already got your policy limits.. If your trying to get more, and you didn't even live there, that is being greedy.


Plus, it is a good idea to ask your adjuster for policy specific answers.

I only received the dwelling policy limit, which according to the adjuster is not enough to repair the damages using standard contractor estimates. I didnt receive anything for contents.

I am only trying to get whats fair. If i dont, its like giving money away. I'm sure the insurance company is glad i didnt have very many contents in the house to get damaged. I'm not going to try to claim something that was not actually damaged. I dont think thats being greedy. Thats why we have insurance.

Thanks
Brandon

 

[moburkes]

I only received the dwelling policy limit, which according to the adjuster is not enough to repair the damages using standard contractor estimates. I didnt receive anything for contents.

I am only trying to get whats fair. If i dont, its like giving money away. I'm sure the insurance company is glad i didnt have very many contents in the house to get damaged. I'm not going to try to claim something that was not actually damaged. I dont think thats being greedy. Thats why we have insurance.

Thanks
Brandon

You've been given what's fair. You didn't have the proper coverage, nor pay the proper premium and you've received the entire policy limits. Plus, if the property was unoccupied, what contents were damaged?