Does the mortgage company keep the insurance check from a flood if we are doing a short sale or a deed in lieu of foreclosure?

UPDATED: Nov 9, 2011

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

Does the mortgage company keep the insurance check from a flood if we are doing a short sale or a deed in lieu of foreclosure?

We were flooded out of our house. We are longer living in it. We will either do a short sale or a deed in liue of foreclosure.

Asked on November 9, 2011 under Real Estate Law, Pennsylvania


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Whether or not the lender that has a mortgage securing its loan on your property is entitled to keep the check from your insurance check for flood damage to the structure depends upon whether or not the insurance carrier issues it to you, to the lender or to you and the lender jointly.

If the check is issued to you only, then the insurance carrier apparently has decided that you alone are entitled to the insurance proceeds for damages regardless of the anticipated short sale or deed in lieu of foreclosure. Good luck.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption