DENHAM SPRINGS - A flood victim caught in an expensive stalemate with his mortgage company received half of the insurance award after calling 2 On Your Side.

Allen Landry's home flood with about 4 1/2 feet of water in August.  His insurance company valued damages and wrote a check for $91,000.  But, since the check was written to both Landry and Wells Fargo, Landry turned the check over to the bank.  He thought he'd be given the money back, but Wells Fargo said it needed proof of expenditures and would pay the insurance amount back as Landry spent money on rebuilding his home.

He received a first installment of $20,000, then had to send in every receipt while borrowing money and dipping into his savings to pay for repairs.  Landry said he spent - and was reimbursed - for another $20,000.

"It's just, it's unbelievable what they're making us do just to get our houses fixed," he said Landry.

"[Wells Fargo said] we had to show paid receipts," he said. "[I had to] buy all this material, pay for the labor and then hopefully they'll send me my money."

According to Wells Fargo, there are two types of claims: non-monitored and monitored claims.  Landry was classified as having a monitored claim.

Non-monitored claims: Checks for claims under $20,000 can generally be endorsed on the spot with the full proceeds made available immediately to the customer.  The customer must be current on their mortgage payment to qualify for an immediate endorsement and may be required to allow Wells Fargo to inspect the repairs once they are completed.

Monitored claims: If a customer’s claim does not meet the criteria for a non-monitored claim, then it will be handled as a monitored claim.  Funds for monitored claims are held by the servicer in an escrow account and are disbursed (payable to the customer and their contractor) in increments, based on the progress of repairs.

Disbursements are handled as follows:

• Initial disbursement occurs when the claim documents are received from the customer.  Upon receipt of the claim documents, the initial disbursement amount is the greater of $40,000 or 10% of the unpaid principal balance on the loan. 
• The second disbursement occurs following an inspection showing 50% of the repairs are complete.  The disbursement amount reflects 50% of the remaining balance in the escrow account.
• The final disbursement occurs following an inspection showing repairs are 100% complete, or 90% complete if remaining repairs are cosmetic. This disbursement is for the remaining balance in the escrow account.

Wells Fargo said its policy is standard industry practice.

As the On Your Side team worked this story Monday, Landry said the bank alerted him he would receive an additional $45,000.  

Landry said he is only missing the last $6,000 but will spend the money on repairs and file the necessary paperwork with the bank.