Property owners who were forced to buy flood insurance by GMAC Mortgage may have legal recourse if they were already covered by an existing flood insurance policy through their condominium association or otherwise. When a condominium complex is located in a "Special Flood Hazard Area", the property and its individual units are already typically insured against flood damage. By forcing a property owner to buy a second flood insurance policy, GMAC is allegedly making the consumer pay for additional coverage which is valueless to them, as federal law will not allow for double payment for insurable losses in a condominium complex.
Are you paying for forced placed flood insurance imposed by GMAC, even though you are already otherwise covered against flood damage? You may have legal recourse to seek financial compensation.
Bank Flood Insurance Requirements
When a home equity loan or mortgage is obtained by a customer whose condominium unit is located in a "Special Flood Hazard Area," the bank may require proof of adequate flood insurance as a condition of obtaining the loan. However, GMAC is then allegedly contacting customers to request additional information and to explain their intention to force place flood insurance. Ultimately, they are allegedly purchasing an additional flood insurance policy at a high premium, the cost of which is either deducted from the home equity account or added to the homeowner's mortgage balance, even though the property is already insured through the condominium complex's insurance flood policy. As a result, the customers have no choice but to pay the premiums.
Lawsuit for Bank Flood Insurance Complaints
If you obtained a home equity loan or mortgage from GMAC and were forced to buy flood insurance, even though you were already covered by your condominium association or otherwise, you may have legal recourse.