If I’m in foreclosure do I have to keep the house insurance up to date?
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If I’m in foreclosure do I have to keep the house insurance up to date?
Asked on August 31, 2011 Illinois
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
If the home you presently own is distressed and is in default, you are under no obligation to keep the insurance in place and up to date. However from a liability standpoint for personal injuries (and resulting personal liability) as well as damages to the home, it is always prudent to keep your homeowner's insurance current.
If you let the insurance premiums for your distressed home lapse, the lender as a most likely named additional insured on the policy can elect under the terms of the recorded mortgage (or trust deed) to pay for any lapsed insurance to protect its security interest in the home.
If you cannot afford to keep insurance for your home in place, you need to call your lender right away about the situation so that it can cover your monthly insurance payments to protect its secured interests in your home.
Good luck.
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