Podcast Summary: The David Greene Show

Episode Title: What Happens To Your Mortgage If Your House Is Destroyed
Episode Number: 42
Release Date: March 24, 2025
Host: David Greene
Guest: Christian Bashelder, Insurance Broker and Partner at The One Brokerage
Segment: Mortgage Monday

Introduction

In Episode 42 of The David Greene Show, titled "What Happens To Your Mortgage If Your House Is Destroyed," host David Greene is joined by his partner, Christian Bashelder. This installment, part of the Mortgage Monday series, delves into the critical topic of mortgage obligations in the unfortunate event of a house being destroyed by natural disasters such as fires or hurricanes. The discussion is particularly timely given recent catastrophic events in regions like Los Angeles and Florida.

Transitioning Roles and Future Plans (00:00 - 01:35)

David opens the episode by introducing Christian Bashelder, highlighting his multifaceted role as both a mortgage and insurance broker. Christian mentions stepping into the role of an insurance broker for this episode, providing a slightly different perspective on mortgage-related advice. David shares their ambition to expand into offering insurance alongside mortgages in the future, aiming to create The One Brokerage as a comprehensive real estate, mortgage, and insurance firm.

Notable Quote:

David Green [00:31]: "Once we are licensed, we're so bored, we're ready to start new companies."

The Impact of Natural Disasters on Mortgages (01:35 - 07:05)

Christian addresses the surge in questions regarding mortgage obligations when a property is destroyed. Referencing recent fires in Los Angeles and hurricanes in Florida and North Carolina, he emphasizes the importance of understanding mortgage and insurance dynamics in such scenarios. He explains that while mortgages are a legal obligation, insurance plays a pivotal role in mitigating financial strain during property loss.

Key Points:

• Forbearance Options: Many lenders offer deferral or forbearance on mortgage payments during catastrophes, though this is not guaranteed and varies by lender.
• Loss of Use Coverage: This insurance clause covers additional living expenses if the home becomes uninhabitable, ensuring borrowers can maintain their standard of living while rebuilding.

Notable Quotes:

Christian Bashelder [06:00]: "If you have a limited loss of use coverage and you have to be displaced, you either have to rent a place significantly worse than where you were living or you have to pay it out of pocket."

Christian Bashelder [03:15]: "Your insurance coverage is important. Can you rebuild? That's very valid."

Navigating Mortgage Obligations Without a House (07:05 - 09:15)

David probes further into the repercussions of not being able to make mortgage payments after a house has been destroyed. Christian clarifies that borrowers remain legally obligated to continue making mortgage payments even if the property is gone. He discusses the potential for foreclosure in such cases and the role of insurance in covering these payments.

Key Points:

• Foreclosure Risks: Without insurance coverage or successful negotiation forbearance with lenders, borrowers risk foreclosure, which can negatively impact credit scores and financial standing.
• Insurance as a Safety Net: Proper insurance can cover mortgage payments during the rebuilding period, preventing foreclosure.

Notable Quotes:

Christian Bashelder [07:47]: "You are still fully obligated to making that mortgage payment. Unless negotiating a forbearance with your lender."

Christian Bashelder [08:16]: "The lender would foreclose on the rubble and the built-up plans to rebuild."

Importance of Homeowners Insurance and Impound Accounts (09:15 - 11:05)

David highlights the significance of maintaining homeowners insurance, noting the challenges of rising premiums and the risks of lapsing coverage. He advises the use of impound accounts to manage insurance and tax payments effectively.

Key Points:

• Impound Accounts: Setting up an impound account ensures that property taxes and insurance premiums are paid on time, reducing the risk of coverage lapses.
• Insurance Maintenance: Consistently paying insurance premiums is crucial to safeguarding against unforeseen disasters and maintaining lender requirements.

Notable Quotes:

David Green [10:16]: "What’s your advice for people when it comes to setting up an impound account to have their taxes and insurance collected with their mortgage or not?"

Christian Bashelder [10:30]: "My recommendation will typically be to impound. The lender is going to the majority of the time, 99 plus percent of the time, they're going to be making that insurance and that tax payment."

Conclusion and Future Topics (11:05 - 12:00)

As the episode concludes, David and Christian reiterate the complexities of mortgage obligations in the face of property destruction. They emphasize the necessity of comprehensive insurance coverage and proactive financial planning. Christian teases the next Mortgage Monday episode, which will explore potential issues even when impound accounts are utilized effectively.

Notable Quotes:

David Green [11:05]: "Sometimes real estate is not fun. Sometimes you have natural disasters, sometimes you have floods."

Christian Bashelder [10:50]: "The lender is going completely within their reason to report that to the borrower's credit, to potentially foreclose."

Additional Resources

For listeners seeking more information or personalized assistance:

• Christian Bashelder:

  • Website: the1brokerage.com
  • Instagram: @theonebroker

• David Greene:

  • Website: davidgreen24.com | realtalkrealestate.com
  • Instagram: @davidgreen24

Listeners are encouraged to subscribe to the channel, leave comments, and submit questions for future episodes, ensuring they stay informed and prepared in the dynamic world of real estate and mortgage financing.

End of Summary