New Century Mortgage Holders: If you were forced or coerced into buying an excessive flood insurance policy, you may have legal recourse. Class Action.org is looking into allegations that certain mortgage companies have been forcing loan holders to purchase or maintain flood insurance policies which are overly expensive, unnecessary or otherwise excessive. While New Century Mortgage Corp. has not been named among the companies participating in these questionable practices, many property owners who took out a loan from other establishments have complained that they were forced into purchasing a costly flood insurance policy which was unnecessary or excessive.
Lawsuits for Force Placed Flood Insurance
Consumers may be able to seek compensation through a forced placed flood insurance lawsuit if they had to purchase or maintain:
More flood coverage than what was required under their mortgage agreements
A flood insurance policy which exceeded federal requirements
A second flood insurance policy even though they were already covered by a condominium association or otherwise
A second flood insurance policy after an acceptable policy was refused
In some instances, it has been alleged that banks who forced placed valueless flood insurance on borrowers received commissions or "kickbacks" for these purchases, the cost of which was added to the mortgage balance, deducted from the consumer's home equity account or otherwise expensed to the borrower.