If we are lending on a commercial property that is a strip mall (3 attached stores) and the strip mall is in a flood zone, do we need to obtain insurance on each store unit or just $500,000 on the entire structure which is owned by one entity?
What are the six criteria a private flood insurance policy must meet?
Is it acceptable to use the RCV from the flood insurance policy rather than the hazard policy? I have seen many contradicting statements related to the use of one over the other.
Would a Yurt that is placed on post/pier be considered a eligible building for flood insurance?
Our examiners are here this week doing our compliance exam. They came across a flood file where we proved the value of the structure in the flood zone (an old barn) was only worth $500. We have a letter in the file from the insurance agent stating that the deductible would be $1,000.. Therefore, we did not require flood insurance. The examiners are saying this is a violation. Can you please direct me to some material I can back my position up with?
We would like to make a construction loan to build a residence on what is presently a vacant lot that is located in a flood zone. We are being told that we cannot obtain flood insurance until we receive an elevation certificate from the builder. The builder states he cannot prepare elevation certificate until AFTER the foundation for the new residence is poured. How can we possibly comply with the regulation that states we must obtain flood insurance AT CLOSING when we cannot obtain the elevation certificate until AFTER the foundation is poured, i.e. weeks after the loan closing?
Beginning this fall, in accordance with Biggert-Waters Reform Act, the NFIP will implement the requirement for agent and policyholder notification in cases where duplicate coverage is indicated. Per FEMA, when duplicate NFIP policies are issued to different named insureds for the same building, the building owner must determine which policy is to remain in effect. For example, if a tenant has purchased building coverage, the policy(ies) must either be endorsed to remove the building coverage, endorsed to include the building owner as a named insured, or canceled. My question, has there been any discussion of how Lenders will be notified of policy cancellations? Will the borrower be given adequate time to produce evidence that the required coverage is in place but through a separate policy that precedes the policy they obtained when their loan was closed? I can foresee this being an issue where a loan was made to a tenant that leases commercial space who was unaware the building owner already had coverage in place.
We are financing a commercial property and it is in a SFHA. We are taking the contents for collateral. The loan amount is $260,000, the hazard insurance coverage on the building is $90,000 and the contents coverage on the hazard insurance $200,000. What flood coverage should we require for building and for the contents?
Is there a notification requirement when a building is mapped OUT of a SFHA? If not, is there any concern with sending notification to borrower?
How can we automate the flood certificate management process?