ORLANDO, Fla. — A Central Florida woman claims her mortgage company failed to make her homeowners insurance payment, which caused her carrier to drop her coverage. She fears this mistake could lead to higher insurance premiums that she can’t afford.
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Army veteran Ruth Santiago lives in a modest home in Orlando and has been paying a mortgage on it for more than 20 years. “I was paying only 400 and something dollars a month,” she said.
Santiago paid monthly into an escrow account that the lender would use to pay her taxes and her annual homeowners insurance premium.
She told Action 9′s Jeff Deal, that this year was different. “This is the first time a company doesn’t pay my insurance,” Santiago said.
Santiago claims the current mortgage holder, Village Capital and Investment LLC, didn’t make her payment at the first of the year. Even though she received notices of cancellation, she believed the mortgage company would eventually pay it.
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“They have paid the year before. So, I don’t see what happened there this year. They could not pay the insurance, same insurance company they paid last year,” Santiago said.
According to Santiago, when the company didn’t pay, her insurance company cancelled the policy.
Now she’s having a hard time finding a new insurance carrier in a state where companies are looking to reduce their exposure.
“The way things are right now in the market and the industry in Florida, the companies are nervous,” said Diana Giron, owner of Universal Insurance Agency.
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Giron said the bigger problem is that the mortgage company could push what’s called force-placed insurance provided by the company, which is often very expensive, and typically doesn’t provide as much coverage as traditional property insurance.
“You know, that is a horrific scenario. It’s extremely expensive, typically two to three times the normal insurance premium,” Giron said.
Santiago’s mortgage has been sold a handful of times over the years, and Giron says that’s often the problem.
Deal reached out to Village Capital by phone and email several times, but the company has not responded.
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The insurance provider, Liberty Mutual, said it doesn’t publicly comment on customer policies, but they are looking into it and will reach out to Santiago directly.
Santiago fears this error could price her out of her own home. “It’s stressful on me because I’m by myself. I live on social security,” she said.
Experts recommend if you get cancellation warnings, make sure you get it paid as soon as possible, even if you have to pay on a credit card and get reimbursed later.
Don’t count on the mortgage company to pay it and risk getting your insurance canceled.