We have an application for an equity loan secured by property the borrower already owns upon which there is a house. The house is in a flood zone. The borrower has no current flood insurance. That means there is a 30 day waiting period before the flood policy becomes effective. So.....we can't close our loan for 30 days.....right?

See page 9 of the General Rules section of FEMA's 6/1/14 Flood Manual. https://s3-us-gov-west-1.amazonaws.com/d...08_june2014.pdf

Because this is in connection with a new loan, I don't think there is a 30 day waiting period as long as the flood insurance is applied for before closing. If this had been an existing loan and you discovered that the loan did not have flood insurance and you did not have a tripwire event (MIRE), then you would have a 30 day waiting period.

Correct. In connection with a loan transaction there is no wait. There is a wait if, as said above, you find out you have a shortfall mid term of the loan.

Somewhat related question...

We have a loan that had inadequate insurance due to the $250,000 raising to $500,000 for 5+ residences. We forceplaced insurance but received yesterday $500,000 proof from the borrower but it says there is a 30 day waiting period for the increase.

Do we have to keep our forceplaced insurance in place until the 30 days is up and credit the borrower for the overlap or can we cancel now?

Got my answer!

So what was the answer?

Inquiring minds need to know.