Haddonfield, New Jersey (PRWEB) March 17, 2014
The plan by New Jersey Governor Chris Christie to raze houses damaged by Superstorm Sandy may cause significant hardships for homeowners and mortgage companies directly affected by that decision.
“Zoning restrictions and ordinances could affect the ability of homeowners to rebuild on the same properties,” said Jeffrey Major, chief operating officer of Canopy Claims Management, LLC, a claims services firm that has worked with more than 750 homeowners and businesses on their claims related to Superstorm Sandy. “In addition, should such restrictions result in the construction of a home of lesser value, the mortgage holder could stand to lose out.”
According to Mr. Major, many homes in the state’s shore communities were built when zoning laws were very different than they are today. Indeed, some homes were built as little as 36 inches from the property line, but new zoning may require larger setbacks, such as 10 feet.
“If the damaged home is left and repaired, the same footprint can be used as the setbacks would be grandfathered,” Mr. Major noted. “However, if the home is demolished, compliance with current zoning and setbacks would be required in order to rebuild. That’s where there could be significant problems."
For example, some properties would not be able to accommodate a new structure. In the case of a single-story home that had to be rebuilt on a smaller foundation, replacing it with a two-story structure may result in a replacement that equals the prior structure’s square footage. However, with a two-story original home, the setbacks would reduce the overall square footage, but height restrictions in many towns might prevent the construction of a three-story replacement.
For mortgage holders, if a house could have been rebuilt on the same footprint but the state tears it down and a new home of equal size and value cannot be built in its place, the mortgage company stands to lose the value securing the loan. Significantly, the mortgagee clause in a property insurance policy may not protect the mortgage company from this loss. Further, homeowners unable to rebuild may face substantial financial consequences.
Canopy Claims Management advises individuals notified by the state that their home will be demolished to consider the following:
1. Notify in writing any and all claims adjusters with whom you have been working of the state’s intent, including any information sent by the state.
2. If you have an open or unresolved insurance claim, notify the state that you are still working on your insurance claim and that you have an obligation to allow the insurance company to inspect the property.
3. Work with a contractor or your insurer to check your neighborhood's zoning requirements and ordinances to see if anything might affect your ability to rebuild on your lot, including if you can build the same square footage with the same setbacks.
4. Check your homeowner’s insurance policy to see what coverages will apply. You may run into a shortfall of funds if your policy has higher deductibles or sublimits for flood damage.
5. Contact an attorney for legal advice, including: (a) the state’s right to demolish your home; (b) your obligations to the insurance company and mortgage holder; (c) who is responsible for the cost to demolish; (d) who is responsible for the additional costs to rebuild, and any other legal matters that may apply to your individual situation.
Additional information is available by contacting Canopy Claims Management by telephone toll-free at 1-800-555-9359 or by email to info(at)canopyclaims(dot)com.
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About Canopy Claims Management, LLC
Established in 2012, Canopy Claims Management, LLC is a leading provider of property claims management services for businesses, private clients and individual homeowners throughout the U.S. The company combines the proven ability to mobilize quickly during a disaster event to help clients assess damage, submit claims and achieve timely recoveries with a focus on establishing relationships with clients and maintaining their critical insurance and property information in advance of any losses to make sure they are in the best position to file a complete claim should a loss occur. Visit Canopy Claims Management at http://www.canopyclaims.com/.