We have a customer that is buying a home located in a flood zone, I know we have to escrow. This brother is putting his land & mobile home up as collateral also, which is in a flood zone. Do we have to Escrow the Flood Insurance on the mobile home to?

If both properties will be collateral - yes.

That is what I told the loan officer, but the loan officer said the borrower is not paying the brothers mobile home flood insurance. But since its collateral he is responsible (in my opinion) for the flood insurance on the mobile home.

Well, who pays for the flood insurance is between the two brothers and the policy on the mobile would have to name the brother as the loss payee if he owns the property. As a lender, you just need a policy if you are taking it as collateral..