Flood victims frustrated with mortgage companies, AG offering help
BATON ROUGE - Flood victims continue to feel frustration when it comes to mortgage companies releasing their insurance money. Some have called 2 On Your Side for help, but now a state office is stepping in.
The State Attorney General's Office says it will help put pressure on mortgage companies to reconcile and encourage people to contact the AG's office if their mortgage services are moving too slowly.
Earlier this month, 2 On Your Side helped Marion and Frank Sommers. Their Sherwood Forest home took on about two feet of water in August. Marion Sommers says they fought with Ocwen Financial Corporation for weeks. It wasn't until she called 2 On Your Side did a check come in the mail.
"Kept giving excuses and put off and put off until WBRZ got involved," she said.
Mortgage companies can use discretion in releasing insurance settlement money. It's standard industry practice to ensure the work is completed. For many rebuilding, this has slowed them down.
"Just sort of tired of being put on the shelf," said Sommers. "I don't think the mortgage company should be able to hold anybody's check."
The AG's office says it will connect the mortgage company and the consumer to resolve the issue is hopefully resolved.
Attorney General Jeff Landry is reminding consumers that mortgage companies are bound by requirements set by mortgage companies Fannie Mae and Freddie Mac that require money to be held in escrow accounts and released in installments as work progresses.
Contact the AG's office if you are having an issue with your mortgage company releasing your insurance money. It can be reached by calling the Consumer Protection Section at 225-326-6465 or 800-351-4889.
For more information about how and when mortgage lenders release insurance money based on requirements set by Fannie Mae and Freddie Mac, click here.