In an opinion written in March of this year in Gomez v. Nationstar Mortgage, LLC, 2015 WL 966224, *1 n.2 (E.D. Cal. March 4, 2015), a U.S. Magistrate Judge wrote:
The U.S.Code defines LPI [what the Magistrate said means “Lender-Placed Insurance”] as “hazard insurance coverage obtained by a servicer of a federally related mortgage when the borrower has failed to maintain or renew hazard insurance on such property as required of the borrower under the terms of the mortgage .” 12 U.S.C. § 2605(k)(2).
Actually, it doesn’t.
The cited statute, a part of the Real Estate Settlement Procedures Act (“RESPA”), defines instead “Force-Placed Insurance”. And for purposes of the statute.
The reality is that it is “lender force-placed insurance” because that’s what it is. It is insurance force-placed by and for lenders.
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