Had a property where the survey said flood zone but determination said no flood zone. Processor did not resolve the discrepancy and the loan closed without flood insurance. Discrepancy was found in closed loan review...research took place, flood determination company reversed determination and showed it in flood zone. Customer said he would not get flood insurance, so the bank force placed (appears it was done with no 45 day notice).

1. Was the 45-day notice required? From which point - the date of the revised determination?

2. Will this be considered a violation?

Yes a notice was required. Information from FEMA's Mandatory Purchase of Flood Insurance Guidelines, you may want to read pages 41 and 42 for more information.

http://www.fema.gov/library/viewRecord.do?id=2954

If at any time during the term of a covered loan, the lender or servicer determines that the building securing the loan is not covered by flood insurance, or is covered by such insurance in an amount less than that required by law, the lender or servicer must first notify the borrower of the need to carry adequate flood insurance coverage. The law does not specify the precise wording of this notice, so lenders and servicers should give a close reading to the statute and regulations for guidance. The notice must state that the borrower should, at the borrower's expense, obtain flood insurance that is not less than
the amount required by law.

If the borrower fails to purchase such flood insurance within 45 days after such notification, the lender or servicer shall purchase the insurance on behalf of the borrower and may charge the borrower for the cost of premiums and fees incurred by the lender or servicer. In an underinsured situation, when the borrower and/or agent of record refuse to cooperate with the new lender, the loan should not be made. If the loan has already been extended, the lender should exercise recourse as provided under the terms of the loan document. The standard 30-day waiting period established by the 1994 Reform Act does not apply to force-placed policies; instead,the 45-day period from time of notification that a lender must grant to a borrower to voluntarily obtain coverage is the only time delay that controls.

Also:

The 1994 Reform Act provides that a lender must inform its borrowers that they have a free choice of an insurer from whom to purchase coverage. That free-choice purchase option also applies to a lender when dealing with force-placed coverage. If, within 45 days from the initial notice, a borrower fails to comply by voluntarily obtaining coverage, a lender or servicer must obtain either:

• A Mortgage Portfolio Protection Program (MPPP) policy through a WYO insurer; or
• An SFIP through either a WYO insurer or the NFIP Servicing Agent; or
• Non-NFIP flood coverage from a private industry insurer if such coverage is available.