We had a borrower come in for a loan with us. They already have an outstanding loan with us that is secured by the same property that the new loan will also be secured with. We pull a flood determination and the property comes back in a SFHA. We look back at the old loan and that determination shows not in a SFHA (not sure what the problem was back then). Further investigation reveals that it truely is in a SFHA.

I would assume at this point we are now aware of loan secured by a property in a SFHA without adequate flood insurance and we need to send out the 45 day notice on the old loan? Since the collateral is actually multiple parcels and only one parcel has a structure, could we also just release that parcel as collateral on the existing loan?

Start the 45 day notice and/or require insurance before closing the subsequent transaction, if earlier.

OR

Release that parcel.

Are you sure this property was not remapped? Does anyone audit the accuracy of your FHD provider to ensure this is an isolated instance?

We verified that the area was not remapped. We have since switched to a new vendor for the determinations. The past vendor had a track record for making inaccurate determinations. At this point we do not have an audit of the vendor's accuracy, but maybe this is something we should institute.