Simple answer here: YES. Your insurance agent or company may not always be notified by the lender that the mortgage is being paid out. And not knowing can cause problems with your Ohio homeowners insurance. Here are the main reasons why you must notify us when your mortgage is paid.
You are currently set up on a blocking account and your bill is being sent to the lender for payment
Let's face it, if you "We have had a blocking account for many years, the payment is paid as clockwork. You probably do not even think about But when your mortgage is paid off, the lender no longer has any reason or obligation to continue doing so, remember that property taxes and insurance are included in your monthly payment and you no longer have a monthly payment (yay!)
So when the bill is sent to the mortgage company for payment, it is at worst that they ignore it. And then the policy for not paying is canceled. Obviously you do not want it to happen.
So if you have paid off your mortgage and received a message about cancellation from the insurance company (it is usually the trigger for many), call your agent so that the mortgagee can be removed AND you can tell which billing plan you want (EFT or direct billing and what rate of payment). The lender paid it for you when you had the hold account. Now that the escrow is longer, it is up to you to pay the invoice.
Simplest solution: just call us when you pay it and we will take care of it then.
Want more information about mortgage accounts? Check out these articles …
You Have a Homeowner Claim
If you have a mortgage on your house, debt checks are paid to you as insured and lender, because they have a financial interest in the home.
So unless we know that there is no borrower, all claims will be issued with both names. This adds another headache to an already stressful situation and slows down the claims process, since we must 1) file a change request to remove the mortgage; 2) then allow the claims department to invalidate the check (s) issued and; 3) Issue a new one with just your name.
If the requirement is serious enough, this delay can cause even more problems, especially if there are suppliers / contractors waiting to be paid for their work. For additional tips / guidance for a homeowner, read our blog post "How Does Ohio Owner Insurance Claim Work?"
So just let us know when the mortgage is paid and we will remove the borrower. Any future damage checks can be issued properly and the process will not be delayed. As an extra tip – if you have a statement brochure, write on the last page "Call Alan Galvez Insurance" as a quick reminder.
And congratulations for reaching this important milestone time to celebrate!
Questions about your Ohio homeowners insurance or do you need a quote? Call us at (937) 592-4871 or visit www.galvezinsurance.com . We are here to help.