Michael and Devorah Merwitz lost their entire first floor to flooding due to Superstorm Sandy, but still, they say, they are fortunate.
The Cedarhurst residents said they’re fortunate because, unlike many Long Islanders dealing with the issue of rebuilding their homes, the Merwitzes had the funds saved up to immediately start doing repairs. They have flood insurance and received a check, but have not been able to receive the funds — almost two months later — due to the back and forth with their mortgage company, Bank of America.
“It’s a rude surprise if you haven’t had the resources, and now they’re going to have to wait weeks until Bank of America pulls their finger up,” Michael Merwitz said. “I’ve heard other banks that have endorsed checks right away.”
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Many Long Island residents are struggling to rebuild their homes after the devastating storm, but those with mortgages have an extra hurdle to clear before being compensated by their insurance companies because the mortgage company must sign off on the check. Some mortgage companies have even asked for repairs to be done before the funds are released, which clashes with the fact that many contractors ask for payments in advance of doing work.
“Check came made out to us and our bank, then our mortgage company forwarded a check made out to us for only some of the money,” Susan Petranek Walpole wrote on Wantagh-Seaford Patch’s Facebook page. “We must complete 90 percent of the work to get the rest of the funds released to us, which our mortgage bank is holding back.”
Kim Cottage-Clyne and Nancy Falcone Arguello also both confirmed via the Wantagh-Seaford Patch Facebook page that they had to first have their insurance checks endorsed by their mortgage company before having the cash in hand.
Assemblyman Harvey Weisenberg (D-Long Beach) said practices such as this have “resulted in a hardship for many families who lack the resources to pay for repairs pending reimbursement. It has also slowed the overall recovery process in my assembly district,” he wrote in a December letter. Weisenberg recently told Patch that banks and insurance companies “acknowledge the problem, but that doesn’t solve my problem.”
The Merwitzes’ loan is held by Fannie Mae, and is a larger amount than Bank of America can endorse at one of its locations, according to Bank of America Spokesperson Laura Hunter. Their check had to be sent to California to be processed, but was again delayed because it lacked the endorsement of the “second lien servicer.”
Michael Merwitz said he met with a Bank of America representative that was sent to New York to deal with Sandy issues, who then handled the paperwork. He said any delay caused by the paperwork is an error on the bank’s part.
Still, Merwitz was reassured to at least get a response from Bank of America after weeks of silence.
“It looks like b****ing and moaning makes a difference,” he said.