Insurance issues: how worried should I be?

[Morning Glory]

So we got an insurance check to pay for some roof repairs. We lined up a contractor but don't have a date for the work yet. Our mortgage is with Wells Fargo. In order to deposit the money, we had to sign an agreement saying the work will be done and inspected within 120 days or else we will be in violation of our mortgage terms and they can call our mortgage due. We owe 229k, originally paid 340k for the house. I have had contractors flake out on me before, and this whole thing has me scared to death.

Has anyone dealt with such a situation?

How likely are they to actually call the mortgage due vs granting an extension?

If they would call it in, how much time do they give you to pay?

How easy would it be to find another loan in a hurry if needed? Our credit union was unable to do our initial mortgage because we are zoned agricultural, so I'm not sure if they could give us a HELOC. We have about $130k in taxable accounts so would not need to finance the full amount. We both have excellent credit and no other debt.

Am I being overly anxious?

[Hargrove]

So I assume it was also insured by Wells Fargo?

The document you signed may say something about if/how/when regarding an extension. A documented start date would probably suffice. If not, call a contractor who will actually give you a start date. There must be more than one roofer in town.

[Morning Glory]

It is insured by another company, but Wells Fargo was on the check because they are the mortgage holder. Our credit union said we had to have it signed by a manager at Wells Fargo before they could deposit it.

We signed up with our contractor last fall. In our area they are booked months in advance. We will call him tomorrow to see when he will start. The form we signed was vague and said we must notify them of any schedule changes, but also that they have the right to call in our mortgage if work isn't done.

[Mr. Green]

As far as being able to obtain a new loan goes, look into whether there is a "Farm Credit" in your local area. They are credit union like entities that specialize in making loans for Agricultural properties. At the bottom of the recession we found an awesome 20 acre property we wanted to buy that had no house on it. No bank would touch it. We found out about Mid-Atlantic Farm Credit and they offered us financing because this property was in line with the type of properties they deal with. Their rates were fantastic, almost the same as what a bank would have loaned at, given that the asset was a little unconventional. I believe there are various "Farm Credit" entities all over the country.

Here's a link to Mid-Atlantic Farm Credit's website if you want to learn more, or see if there's one in your area.
https://www.mafc.com/

[Morning Glory]

Thanks, I am sure that having to refinance is the worst case scenario. Most likely the repairs will be done on time, or the bank will give a reasonable extension. I still feel like I should have refused to sign that form, or at least waited to start the timeline until I actually have to pay the contractor.  I have heard too many horror stories about people being screwed over by big banks.

All this anxiety is just making me wish I had started investing sooner. It really makes me want to save enough fuck you money to just pay off the stupid mortgage if something like this happens again.

[Morning Glory]

Update: I got a tentative date from the contractor of July 21st. He wants to try and get the insurance company to pay more. Originally they only wanted to pay for one side of the roof, because the other side did not have 20% of the shingles missing. I also found out that the insurance company has a deadline of August 4th to get the work done, which isi a month sooner than the bank's deadline.  If they won't pay the full amount, we will probably kick in some of our own money so that the work gets done well.

After some google searches, I found out we are lucky that the bank didn't insist on keeping the insurance money in escrow until the work is done. There are many complaints on the internet about people having to wait months to get their money back so they can pay their contractors. 

I hate situations where I have little control over the outcome.