Posted By: Bec
4-unit Apartment with detached garage-flood - 06/26/17 04:36 PM
Loan to be secured by a 4-unit apartment building with a detached garage. The apartment building is not in the flood zone, the detached garage is.
I have seen two schools of thought on this scenario. One is where the detached structured is for commercial purpose and therefore commercial property which is not exempt via the detached structure rule. The other school is that the apartment building is residential and therefore the detached garage would be part of that residential property and therefore flood insurance would not be required (safety and soundness being a factor of course).
My question is, has any one had any examiner scrutiny on not having the detached structured flood insured because the interpretation is that it is commercial? Or has anyone had examiner acceptance for not having a detached garage flood insured in a similar or same scenario?
I have seen two schools of thought on this scenario. One is where the detached structured is for commercial purpose and therefore commercial property which is not exempt via the detached structure rule. The other school is that the apartment building is residential and therefore the detached garage would be part of that residential property and therefore flood insurance would not be required (safety and soundness being a factor of course).
My question is, has any one had any examiner scrutiny on not having the detached structured flood insured because the interpretation is that it is commercial? Or has anyone had examiner acceptance for not having a detached garage flood insured in a similar or same scenario?