What type of notice is required when a bank makes, increases, extends, or renews a loan secured by building located in a special flood hazard area ( §22.10(a))? It seems this is a different notice than what is required by the transfer of servicing rights requirement (§22.10(a)).

Any help would be appreciated!

You mean one like this:

https://www.usbank.com/content/wholesale...lood_hazard.pdf

Normally your FHD provider gives it to you.

I am reviewing testing being performed by our 2nd Line of Defense and found to cover the notice requirement under §22.10(a) the insurance policy is being reviewed to validate the Bank is listed as mortgagee and loss payee in the correct lien position. Does that test seem to cover the requirement?

The insurance agent is a desiganee of FEMA. They notify FEMA of the servicer when they submit the policy request therefore if you are properly named on the policy then they (FEMA) have been properly notified..