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#2202580 - 01/10/19 04:36 PM Structure with No Value
mdog76 Offline
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Joined: Jan 2007
Posts: 645
If we make a flood loan and that property has a structure with no apparent value and none was given in the appraisal, how do we properly assign a value to it for flood coverage?

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Flood Compliance
#2202588 - 01/10/19 05:13 PM Re: Structure with No Value mdog76
Adam Witmer Offline
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Joined: Sep 2010
Posts: 2,564
The easiest way would be to contact an insurance agent and get an RCV (or ACV if applicable).
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Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
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#2202611 - 01/10/19 06:13 PM Re: Structure with No Value mdog76
David Dickinson Offline
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David Dickinson
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Central City, NE
Every building has some value. You can look at the tax assessment, the insurance agent's value (as Adam stated), do a drive up/inspection, etc. The lender is required to make a good faith determination of value.
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#2202641 - 01/10/19 08:06 PM Re: Structure with No Value mdog76
mdog76 Offline
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I just saw who answered my question ha! Adam Witmer, I asked this after watching one of your videos on your website.

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#2202642 - 01/10/19 08:07 PM Re: Structure with No Value mdog76
Norman Paperman Offline
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Norman Paperman
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Also make sure you are ordering your flood determinations prior to ordering an appraisal. At our shop, any loan identified as being in a SFHA requires a cost-approach appraisal.
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#2202644 - 01/10/19 08:22 PM Re: Structure with No Value mdog76
Adam Witmer Offline
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Originally Posted By mdog76
I just saw who answered my question ha! Adam Witmer, I asked this after watching one of your videos on your website.

wink
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Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
www.compliancecohort.com

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#2202645 - 01/10/19 08:23 PM Re: Structure with No Value Norman Paperman
Adam Witmer Offline
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Posts: 2,564
Originally Posted By Norman Paperman
Also make sure you are ordering your flood determinations prior to ordering an appraisal. At our shop, any loan identified as being in a SFHA requires a cost-approach appraisal.

Which is a great solution to this problem.
_________________________
Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
www.compliancecohort.com

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