Conclusion

• Author: Dennis J. Wall
• Pages: 295-296

295

There are two business models in every loan. Both involve force. One is

repossession or foreclosure at law. The other is collateral protection insur-

ance, which we generally believe is a few steps short of foreclosure.

When we sign a loan contract, we almost always agree to keep insurance

in place to protect the lender’s interest in the collateral we pledge to get the

loan. We further agree that if the insurance ends for any reason, then the

lender can force-place insurance to protect its interest in our collateral and

bill us for the new premium.

But we do not agree that our lender can secretly inate the premium,

pocket the prot, and send us the bill.

This book has focused on lender force-placed insurance (LFPI) prac-

tices under residential mortgage loans. The author’s research into these

practices rests on public records. It includes commentary on the issues in

newspapers, books, magazines, and law reviews. For the rst time, so far

as is known to the author, it also includes a thorough review of the court

les in lender force-placed insurance cases, including the National Mort-

gage Settlement court le.

Secrecy is part of the prot-taking practices in force-placing insurance

under residential mortgage contracts. The court les of the cases in which

homeowners have brought lawsuits over these practices are generally led

in federal courts. The cases are almost all protected to one degree or another

by secrecy stipulations submitted to judges to declare the practices con-

dential. They have the effect of hiding these practices from public view. Too

often, these stipulations are approved just as they were written, and the

practices may never be known except to a few.

What information is publicly available, to the extent that it is available at

all, is largely available through PACER, the portal for public access to the

federal courts’ electronic records, as well as in published decisions (whether

the decisions have been published ofcially or unofcially).

Conclusion

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