Insurance Loss Draft Frequently Asked Questions
Residential Credit Solutions understands that any time your house is damaged, whether it be from a small claim or a complete loss, it can be a very difficult time for you and your family. To help you through this process, we have provided helpful answers for some of the frequently asked questions related to insurance losses for your home. These questions and answers are designed to provide guidance when a homeowner receives an insurance loss draft (also known as a claim check) as a result of a filed claim with their insurance company. Of course, you can always contact our Insurance Loss Draft Department directly at (866) 574-4005 during normal business hours, by Fax (866) 557-2069, E-mail (LossDrafts@residentialcredit.com
) or at the following address:
|Residential Credit Solutions, Inc. |
Attn: Loss Draft Department
P.O. Box 792463
San Antonio, TX 78279
|Phone: (866) 574-4005 |
Fax: (866) 557-2069
What is the difference between a Monitored and Non-Monitored claim?
On Non-Monitored claims we endorse and return the loss draft to you without further conditions. A Monitored claim requires that the loss draft be deposited with us and the completion of the repairs to your home will be verified with inspections. Final disbursement of the claim funds will be made only after all repairs are complete. Our Insurance Loss Draft team is an experienced group whose most important objective is to release all insurance loss drafts as soon as possible so that the damage to your house is repaired with minimal inconvenience to you and your family.
Why do you have to inspect the property on claims you are monitoring?
To ensure all repairs have been completed and the property has been restored to its original or higher value.
I received a loss draft, now how do I cash it?
Generally, if the total amount of your insurance claim falls below $10,000.00 and your loan is current and in good standing, the unendorsed loss draft can be sent to us to be endorsed. We'll immediately endorse the draft and return it to you so that you can begin repairing your home. If the total amount of your insurance claim exceeds $10,000.00 or your loan is currently in default, the loss draft must be deposited with us and processed as a Monitored insurance claim.
Why is Residential Credit Solutions listed as a payee on the insurance loss draft?
Residential Credit Solutions is listed as a loss payee on your insurance policy. We will be included on any insurance loss draft because we have a secured interest in the property. Our responsibility is to ensure the property is repaired in the event of damage and restored to its original or higher value.
I sent my insurance loss draft to RCS, which was over the established guidelines, and forgot to sign it. What happens now?
We will return the check to you for your signature. We cannot begin the claims process until we receive the endorsed check and all required paperwork.
Why do you distribute monitored claims funds in 1/3 increments?
Providing the funds in increments protects you from contractors who would complete part of the work and still get full payment without completing the entire job they were hired to do.
What if my contractor needs more than 1/3 of the funds?
The contractor must submit a request that is signed by both you and the contractor. We will review the request and determine whether additional funds can be released.
Can I use part of the loss draft funds to bring my delinquent loan payments current?
No, all loss draft funds are to be used for property restoration only.
Can I use my claim money to pay off my loan?
Yes. If the amount of the claim exceeds the outstanding principal balance on your loan, send the endorsed loss draft with a letter authorizing us to use the funds to pay off the loan. If the amount of the check is less than the total amount owed on the loan, and you want to pay the loan off, you must send certified funds for the difference along with the endorsed loss draft and a letter authorizing us to pay off the loan. If your loan balance is less than the claim amount, the insurance loss draft can be used to pay your loan in full. Send the endorsed loss draft with a letter authorizing us to use the funds to pay off the loan. Any funds exceeding the amount required to pay off your loan will be refunded. However, if you do not wish to pay off your loan, the insurance claim funds will be processed according to the monitored insurance claim procedures.
My loan is paid in full. Why are you still holding my insurance claim funds?
All remaining funds will be refunded to you within 21 days from the date of the payoff. This allows sufficient time for the loss draft funds to clear the bank.
My loss draft is for damage on the barn, shed, garage, etc., and I do not want to repair it. This structure was not part of the mortgage. Can I keep the money and not repair the damaged building?
Your loan documents state that you will 'keep the improvements now existing or hereafter erected on the property, insured against loss.' Any exceptions to this must be handled on a case by case basis. You will need to discuss the details of the structure involved in the insurance claim and the reasons the structure can not be replaced with the RCS Insurance Loss Draft team member assigned to your claim.
What if I don't use all of the insurance money for the repairs?
As long as you are current on all loan payments, when the repairs are 100% complete as confirmed by an inspection, and all contractors (or other repair companies) have been paid, any remaining money is refunded to you.