Michigan Joined Settlement With Mortgage Servicer NewRez
The state secured over $274,000 as part of a $15.5 million multistate agreement.
Updated on Oct. 5, 2026 in Insurance
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Michigan has joined a $15.5 million settlement with the mortgage servicer NewRez to resolve claims that it improperly charged borrowers for force-placed insurance. The agreement follows a multistate examination involving 49 regulatory agencies.
Why it matters
The settlement addresses systemic errors where the company forced insurance costs onto over 4,200 homeowners who already maintained their own active, compliant policies.
NewRez is paying $4.5 million in direct remediation to borrowers and $11 million in civil penalties and costs. Michigan’s portion of the total settlement funds amounts to $274,206.
The players
NewRez
NewRez is a mortgage servicing company based in Fort Washington, Pennsylvania that was subject to a multistate regulatory examination.
District of Columbia
The District of Columbia served as the lead authority for the enforcement team conducting the multistate investigation.
The details
NewRez, headquartered in Fort Washington, Pennsylvania, failed to verify existing coverage before imposing additional insurance premiums on borrowers. The company has since agreed to implement enhanced monitoring protocols to prevent similar billing errors in the future.
Timeline
October 5, 2026: The settlement announcement was made public.
Market Dynamics
This enforcement action reflects a broader trend of multistate regulatory cooperation aimed at curbing predatory practices within the mortgage servicing sector. It follows established precedents set by the Consumer Financial Protection Act's mortgage servicing standards regarding the oversight of third-party insurance billing.
Impacted Michigan homeowners who were overcharged for duplicate coverage will receive direct financial remediation. Affected parties are not required to take further action as the company has already identified eligible accounts for reimbursement.
The takeaway
Homeowners should regularly review their mortgage statements to ensure that escrow accounts do not include charges for services they have already procured independently. Maintaining clear records of your active homeowners insurance policy is the most effective way to identify and contest erroneous force-placed charges.
Further reading
For additional context on how state oversight impacts your policies, read more in Insurance.
Source note: This article includes information reported by Insurance Journal.
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