We are doing a loan modification for a MFH w/out land (changing rate/term to lower payments for customer). Do we need to pull a new flood on modifications like these?

We have a flood we pulled when the loan was done with LOL coverage & the account number is still the same.

I say no, but wanted reassurance.

If the existing determination meets all 3 of the following you can rely on it. If it does not meet all 3 conditions and if the modification increased the loan balance or extends the maturity you will need a new determination.

The 3 conditions are:

1. The determination is on the prescribed SFHDF;

2. Is LESS than 7 years old; and

3. There have been no map changes.


PS. LOL monitoring does not insure you will be notified of a map change, only that you will be notified if there is a status change in the property.

Perfect...thanks!

If the modification is just a change in terms (not a new loan) and doesn't increase the amount outstanding, would the need for a determination even be triggered? I have a meeting on this topic tomorrow and thought I understood the requirements, but now I'm wondering if I'm mistaken. Thanks.

Yes that is correct. If you are making, extending, increasing or renewing a loan then the flood determination and notice is required.

If your loan transaction does not meet that criteria, then no new determination is needed.