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What is forced place insurance?

April 26, 2017forced Insurance

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What is forced place insurance?

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If your homeowner’s insurance policy lapses, Residential Capital will purchase insurance on your property to protect the assets underlying our loan. This insurance is called “forced place insurance.” This insurance is added to the cost of your loan and your monthly payments. Forced place insurance is considerably more expensive than insurance you can purchase on your own, and it covers only the lender, not you. It is in your best interest to obtain your own insurance at a competitive rate. Upon receipt of confirmation that you have obtained homeowner’s insurance, we will credit your account for that portion of forced place insurance which was not used.

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A. If you fail to maintain full coverage insurance on your vehicle, it is our option to Force Place insurance on your loan. The premium is added to your loan balance. Force Placed insurance covers comprehensive and collision coverage only. Liability insurance is not included.