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#1777573 - 01/17/13 08:08 PM Effective Yet???
HR Banker Offline
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Joined: Oct 2002
Posts: 1,027
Can we force place the day after expiration and charge the customer now (from the 1st day)? I thought this was part of what was to come, examiner indicates this is the law now.

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Flood Compliance
#1777577 - 01/17/13 08:11 PM Re: Effective Yet??? HR Banker
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
have them show you. It is still in proposal stages and I think the DFA might not allow them to do it under the force placed rules found there.

Well I just read the new CFPB servicing rules and a property in a flood zone covered under the FDPA is exempt from the new force placed rules. Still, those Q&A have never been finalized.
Last edited by rlcarey; 01/17/13 08:18 PM. Reason: added comment
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#1777604 - 01/17/13 08:43 PM Re: Effective Yet??? rlcarey
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Joined: Oct 2002
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I just found this:

• Updated (1-17-2013): Section 100244 which amends section 4012a (e) of the Flood Disaster Protection Act of 1973 on force-placement of flood insurance. Although neither section 100244 nor the statutory section it amends expressly directs the banking agencies to write implementing regulations to affect this change, the banking regulators have exercised this authority, writing regulations on the force placement of flood insurance (see12 C.F.R. Part 339.7) and guidance (see proposed interagency Q & As #57-62). Therefore, ABA believes that section 100244 should not be effective until the banking agencies write a regulation. We understand, however, that the FDIC believes that section 100244 was effective upon enactment.
It is important to note that section 100244 makes the following changes to force placement:
o Clarifies that although a bank cannot force place until 45 days after notification of a lapse, the bank may charge the borrower for the cost of premiums and fees incurred for coverage beginning on the date on which flood insurance coverage lapsed. (This will require the banking agencies to revise proposed Q & A #62.)

So would this mean that we can use a gap policy beginning on day 1 but could charge the premium to them? And can do that now?

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#1777609 - 01/17/13 08:50 PM Re: Effective Yet??? HR Banker
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
Personally, I have no idea what it means. You can't force place, but you can charge them and what to they mean by "the date on which flood insurance coverage lapsed." The mortgagee (bank) is covered for 30 days after the borrower is not.

Maybe this knowledgeable examiner can shed some light on it??
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#1778148 - 01/18/13 08:42 PM Re: Effective Yet??? HR Banker
YosemiteSamIAm Offline
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Joined: Jan 2004
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Guess
Oh my, still laughing over the use of the phrase "knowledgeable examiner".
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