Road blocks to recovering from Irene

A year after Hurricane Irene hit the county where the workforce lives along the sound, many are still struggling to repair homes so that they can get out of temporary housing.

The sound side of Hatteras Island, mainland Dare County, west side of Kitty Hawk and in Colington aren't generally on the way to lunch or work and thus don't stay in the public's eye. There are volunteer work crews still coming in to help rebuild, repair...recover.

A large part of the holdup has been settling claims, particularly for flood insurance.

Immediately after the storm, there were signs that things were amiss with the federal flood program. Beth Midgett at Midgett Realty in Hatteras and I began comparing notes on what we were hearing in various parts of the county and it wasn't pretty.

Neighbors in Stumpy Point began bringing proofs of loss to me to see if I could make sense out of them. What I found was criminal - in the legal definition of the term. During the first four months following the hurricane, I reviewed more than a 100 POLs from the village and elsewhere in the county. Very, very few of those were defensible when compared to the flood program's adjuster's manual.

A year later, this is what we know:

Although illegal, many of the flood adjusters sent in were not certified by the flood program. But per federal law, the public has no right to know if an adjuster is certified to do flood adjustments. License and certification records for doctors, sewer plant operators, contractors, hair dressers and other professions are open to public scrutiny so what don't they want the public to know about flood adjusters?

Computer data bases used by adjusters to determine structure replacement values frequently weren't set on Dare County zip codes and thus caused payouts to be much lower than they should have been. If declared a total loss, a  low-end figure will result in a payout that will not rebuild a similar structure. A high end error can falsely indicate that coverage to replace the house was below the 80 percent threshold which allows the adjuster to depreciate each and every component in the structure from baseboards and drywall to rafters and insulation.

As claims were settled and checks issued, problems with some banks began to pop up like toad stools after a rain.

A year later, this is what we know:

Some homeowners who let banks roll the insurance premiums in with the loan payments and pay the premiums found that the wrong amount of coverage had been placed on their homes. It didn't cover replacement value, the balance of the loan, and in some cases, the banks had failed to place contents coverage although the homeowners had requested such.

The banks held the insurance checks until homeowners rebuilt and/or repaired the damage. Many didn't have enough discretionary income to do the repairs out of pocket so they took advantage of offers to defer mortgage payments for three months so they could use that money for repairs. But instead of adding the deferred payments to the end of the mortgage, after three months, many of the banks demanded the payments, interest and late charges to avoid foreclosure.

In cases where the homeowners couldn't find the money to rebuild or repair, they let banks keep the checks to apply the amount against the mortgage but it often left a loan balance. Construction loans are difficult to get with an existing mortgage tying up  the property as collateral so homeowners are paying mortgages on houses they can't live in and can't get loans to repair/rebuild.

In no instances did I hear of a bank offering to provide a bridge loan to homeowners so that the repairs could be made. The banks held the insurance money and the property as collateral so there was nothing for them to lose.

When Congress convenes in January, there should be a Dare Cares Day in Washington, DC. Property owners in the county come from every state in the union which means there isn't a senator or congressman who doesn't have a constituent with interests in Dare County.

It's time to do a full court press to get the federal flood program cleaned up and to tell banks to put some accountability and common sense back into their processes.

Even without asking, I know Beth Midgett will go with me...will You?