The 3 Ps of a Smart Mortgagee: Protect, Preserve, Prosper

Luckily, mortgagee rights are no secret. In fact, you can—and should—read the fine print to find out exactly what your rights are. And that fine print is located in either a deed of trust or the mortgage deed. Because hey, knowledge is power and this knowledge will empower you to protect, preserve and prosper. And those are the 3 Ps of a smart mortgagee.

So, you’ve got a property that’s vacant and you’ve got full coverage. That’s good. But, that’s not all. To ensure you get the most accurate settlement possible in case you do file a claim, there are a few things to know now that can protect you—and your investment—tomorrow.

Protect: Don’t Let “Change of Risk” Put Your Settlement at Risk

A “change of risk” simply means that your property has undergone one of three major changes as determined by the insurance industry. Those changes include:

1. Foreclosure Sale
2. Vacancy
3. Change in Structure

Now, this is important to you because if your property does go through one of these major changes you must notify your insurance company in writing, and note when the change took place. If you don’t and a major change does occur on your property, the insurance company may have the right to deny that claim. All it takes is a letter and a little foresight to keep your risk low and your property protected.

Preserve: Time Waits For No Man (And No Claim)

Tick tock goes the clock and the timeframe on your claim. Say you’ve got a property that’s been vacant for three years. And during that first year, there was a tornado that damaged the roof and caused a tree to fall on the fence. Now, if you live in Texas, where twisters are all-too-common, and you were to file that tornado claim today, you’re going to be denied. Why? Because the statute of limitations for property damage in Texas is just two years. That means you forfeit a potentially large settlement just because you waited too long to file the claim. Each state, including the District of Columbia, has a different law regarding its statute of limitations; and those statutes can range from 1 – 10 years. So don’t delay! Make the claim today.

Prosper: How to Settle a Claim Without The Wait

Sometimes, filing a claim with an insurance company can be slow going at best. But knowing some facts up front can speed along the process and get your settlement signed, sealed and delivered. Here are some things you can do along the way to quicken your settlement claim:

• Be available to receive calls and answer emails from your insurance provider
• Know the date of loss
• Know the date of discovery (when you realized the property had been damaged)
• Know exactly what your insurance policy covers
• Get backup (such as supporting documentation for your claim)

Knowing your mortgagee rights before a loss takes place is essential to keeping your property protected and receiving an accurate settlement when you do file a claim. And remember, it’s easy, just follow the 3 Ps of a smart mortgagee: protect, preserve and prosper.