When a spouse dies, the attending financial responsibilities and lack of knowledge about basic rights and protections can lead to confusion. Even worse, it can lead to financial disaster and possibly home foreclosure. For one widow, not understanding or being aware of protections her husband had put in place almost lost her home to foreclosure. Any Florida widows or widowers who are unsure of what protections may be in place for them or who may be unfamiliar with how home foreclosure works may want to follow the story.
The woman at the center of the story lost her husband in 2003. She continued to pay her mortgage after his death. However, she was told in 2013 she was on the verge of losing her home. One reason cited was because it was not her husband’s primary residence. Her attorney decided to dig deeper.
It was discovered she was paying a monthly premium for an insurance policy to protect from foreclosure by paying off the loan if her husband died. The policy was for $100,000. At the time of his death, there was only $120,000 owed on the home. She had no idea about the policy or that she didn’t need to keep paying what she had struggled to pay after he passed away. The bank ultimately refunded the overpayment of principal and interest to the woman, but it remains unclear what responsibility the bank had to provide notice of the insurance proceeds to the woman, even as she was in the midst of losing her home.
Being unclear about possible benefits or protections can lead to disaster for elderly or widowed homeowners. However, mortgage protections and insurance policies may be confusing for homeowners at any age. If a Florida homeowner is facing home foreclosure, understanding the process and what options may exist to protect against losing the home is crucial.
Source: naplesnews.com, “As it moved to seize home, bank never told widow her loan was insured”, Kevin G. Hall McClatchy, April 18, 2015