[i]Hello Compliance Minds!

I was asked a question today which I cannot find any specific guidance on. The question was "do we need to have flood life of loan tracking on construction loans to spec builders".

The regulations require that IF a property becomes part of a flood zone we are required to notify the customer or force place, etc. My understanding is that this requirement applies to all loans, regardless of the term, and that you probably wont know if a flood zone changes without life of loan tracking. Thus, it would appear that in order to be able to comply with the flood rules, life of loan tracking is required (or highly advisable) regardless of the loan term.

I cannot find any exclusions of exceptions for short term loans or construction loans.

Any guidance would be appreciated. Do you require? thank you!

The regulations say "if you become aware". There is no regulatory requirement to have life of loan coverage on any loan. What you do not know in this situation can not hurt you.

Thank you Randy