If a lender makes a loan to a borrower for a non-residential condominium unit that is in a flood zone and the condo association does not have flood coverage, what are the options for the borrower? Can a private flood policy be written for a borrower who doesn't own the building?

If the borrower doesn't own the building, how are they pledging the building as collateral? If the building isn't collateral, flood insurance doesn't apply.

It's a commercial condo unit (which happens to be an airplane hangar). I guess I should have clarified - the condo will be owned by the borrower. The condo association does not carry flood insurance on the condo. So, can the borrower obtain a private policy instead?

No.

E. Non-Residential Condominium – Unit Owners Coverage

• Use the Dwelling Form to insure residential condominium unit owner’s
contents in non-residential condominium buildings. Condominium
unit owners in a non-residential condominium may not purchase
building coverage.

It basically makes the property ineligible for collateral for a loan by a bank.

When I read the FEMA documentation on individual residential condo coverage, they use the term "may" be insured. If the bank takes the individual condo as collateral, not citing the contents, is flood insurance REQUIRED on the contents/fixtures etc?

If contents are not part of your collateral, content coverage is never required.

Where I am struggling is that I guarantee that the appraiser is using the finishing's, fixtures kitchen, granite etc as a part of the value of the unit, especially in high-end condos on a beach. But a HOA coverage policy, unless it is the RCBAP type, would not replace those. Even with the RCBAP policies, the HOA can change the coverage and the unit owner would have no coverage.

It doesn't matter what the appraiser uses for appraised value, it only matters what you are taking as security.

This is something I am struggling with. even though it is a non-residential condo (because the commercial % exceeds the residential %), if the flood insurance lapses you cannot force place or require the borrower to obtain insurance for the individual residential unit?

You can't force place a NFIP policy. You might be able to force place a private policy. Otherwise you are basically left with calling the loan.