How are PML/HML's handling the insurance crunch?

[David C.]

I have a note in FL, borrower isn’t paying the insurance, too expensive, I guess.

Borrower is very abusive and uncooperative with loan servicing … I’ve given up trying to work things out with them. I don’t want to foreclose, with a low ltv I will get paid off one way or another at some point. I watch taxes and pay them just before tax sale. All my expenses get added to the loan balance of course.

I put forced place insurance for a while, but the premium isn’t covered by their monthly payment, so I cancelled FPI.

It's a first position loan with a 15% LTV … I'm not worried if the place burns down, I believe there will still be enough equity to cover the loan.

I don’t see my situation as a big problem, just wondering if others are having similar issues.

[Chris Seveney]

Quote from @David C.:

@Chris Seveney

This attorney seems to be saying mortgages get wiped out in a FL tax deed sale.  Which is consistent with what I've always heard ... tax liens are super liens, senior to most other liens, except maybe municipal, condo liens and such.

Are you running into issues with borrowers not carrying insurance due the the increased costs?

Yes tax liens are superior, and when the tax lien holder goes to foreclose it will go through a tax deed sale. If it goes to tax deed sale its like being in 2nd position on a foreclosure, bid what you are owed. Lets say you are owed $50k, taxes were $10k, you bid $60k and if its really worth $500k then someone will bid above $60k. If someone bid $100k the taxes get paid, you get paid and the rest goes back to the borrower.