Flood Insurance Requirements For Unoccupied Dwellings or Mobile Homes
by Andy Zavoina and Lucy Griffin, BOL Gurus
Question: We are financing the purchase of land with a small cabin on it and taking as additional collateral a piece of property with a mobile home and pole barns on it. The properties are or will be owned by a partnership and will not be owner-occupied. It has been determined that the property with the mobile home and pole barns on it is in a flood zone. The mobile home is not in good condition. No one is living in it. In this case, would the borrower have to get flood insurance on the mobile home?
Answer by Andy Zavoina BIO AND CONTACT INFO
I believe you do. But since the insurable value excludes the land, the remaining structure should be of minimal value and hopefully minimal cost to insure.
You might be able to exclude it if it was excluded from your mortgage documents and was to be razed.
Answer by Lucy Griffin BIO AND CONTACT INFO
Your opinion about its value is not the determining factor. The actual value -- what can be lost due to a flood -- is what you have to consider. Insurance would be necessary if the structures meet the flood regulations' value test.
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