CitiBank Excessive, Forced Placed Flood Coverage Claims Under Investigation
(EMAILWIRE.COM, October 26, 2012 ) New York, NY The attorneys working with ClassAction.org are investigating allegations that Citibank required certain borrowers to purchase and maintain more flood insurance than what was necessary. It has been alleged that CitiBank unfairly required their borrowers to carry and pay for flood insurance that exceeds the amount of coverage required by law and their mortgage agreements, and greater than their outstanding principal balance. Furthermore, Citibank has arranged for unlawful kickbacks and commissions for these purchases, the cost of which is expensed to the borrower, according to the allegations. If you believe CitiBank forced you into paying for an excessive or unnecessary policy, the attorneys working with ClassAction.org would like to hear from you to help determine if you have legal recourse for these allegedly unfair business practices. Potentially, you may be able to file a claim against your lender to seek compensation for losses associated with this forced-placed insurance. For more information and a free evaluation of your claim, please visit http://www.classaction.org/forced-placed-flood-insurance.html today.
A number of large financial institutions have been hit with lawsuits alleging that they essentially abused their authority to force placed flood insurance on their borrowers. One lawsuit filed in New York alleges that CitiBank and Midland Mortgage force placed excessive flood insurance on borrowers and arranged for improper kickbacks or commissions in association with the coverage. The complaint alleges that the plaintiff was required by Citibank to carry flood insurance which exceeded the amount of his loan balance by more than $100,000. After the plaintiffs mortgage was acquired by Midland, he was allegedly required to maintain even more flood insurance, approximately 14 times the amount of his minimal loan balance, according to the suit.
In this case, it was alleged that Citibank and Midland Mortgage purchased costly flood insurance out of the plaintiffs escrow account to meet requirements which were not consistent with federal laws, HUD requirements and the terms of the plaintiffs loan. These establishments are not the only ones who are facing such allegations, however; a number of borrowers have alleged that their respective lenders are engaging in similar practices. It has also been alleged that some consumers are being required to pay for forced placed insurance after an acceptable policy was refused or for a second policy even though they were covered through a condominium association or otherwise.
When a borrower allows their insurance to lapse, lenders are legally permitted to purchase insurance to replace this coverage and require the homebuyer to pay for it; allegations have surfaced, however, that some banks may be force-placing this coverage when it is not necessary. Forced-placed insurance can reportedly cost up to ten times as much as borrower-purchased policies, while offering less protection, and could potentially cause problems for homeowners already struggling with debt. If your mortgage lender force-placed insurance on your property, the attorneys working with ClassAction.org are offering a free case review to help you determine whether you can take legal action for an excessive insurance policy.
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Class Action.org is dedicated to protecting consumers and investors in class actions and complex litigation throughout the United States. Class Action.org keeps consumers informed about product alerts, recalls, and emerging litigation and helps them take action against the manufacturers of defective products, drugs, and medical devices. Information about consumer fraud issues and environmental hazards is also available on the site. Visit http://www.classaction.org today for a no cost, no obligation case evaluation and information about your consumer rights.
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