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Was there any notice to provide proof of insurance with the lender named in the declaration? Was it in the loan agreement?
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Thank you for the additional information.
If the lender did not comply with the loan agreement, in either notice or the requirement to be named in the declaration, then they are in breach of the agreement and she can sue them for damages.
She may want to start by hiring an attorney to write letter on office letterhead threatening legal action for breach if she is not resored to possession.
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