04/21/2003
I'm needing to know what the best way is to document the file for a waiver of flood insurance on agricultural land (with a barn on it). Is flood insurance really required?
04/21/2003
We will soon be launching a home improvement product for which we will be taking security interest in items that will likely become fixtures, i.e., windows, furnaces, etc. We will not be taking any traditional mortgage in connection with this product. Is the right of rescission triggered by taking such interests? Also, is there any concern with the application of federal flood regulations?
03/17/2003
What are Life of the Loan requirements for flood insurance? Our understanding is that a bank must determine if a property is in a flood area and then at the time the bank has committed to make, increase, extend, or renew a loan the bank must require the proper insurance, if it has determined that the property is in a flood area. Also, the bank must monitor that this proper insurance is in place for the life of the loan. Force-placed insurance may be required if a policy lapses or the bank has knowledge of a change in flood status. Life of the loan tracking for properties which were determined not in flood areas, is not required because there is no duty on the part of the lender to monitor any changes in the flood maps or perform any type of portfolio review when flood maps are revised. Is our understanding of the flood insurance requirements correct?
03/03/2003
Our bank is considering implementing a loan document preparation fee. Other than making sure these fees are disclosed as a part of the finance charge, are there any other pitfalls or disclosure issues we need to be aware of and address? We would charge the fee on new originations only.
02/17/2003
We have a customer who purchased property located in the Flood Plain. A Church was built in the middle of the property. A survey of the property has been prepared and the customer is in the process of filing a application for Loan to take this structure out. There are other structures on the property if the Church structure is taken out, do we just need to get flood insurance for the value of the other structures? If their value is less than our loan amount, how much coverage is required? The value of the other structures or the loan amount?
02/17/2003
If we finance the purchase of land for a customer and there is a mobile home on the land not owned buy the customer is Flood Insurance or Notice required? A relative of the customer lives in the mobile home but pays no rent to live on the land.
02/17/2003
If the bank has a mortgage on a farm, and the mortgage states "That it secures future loans to the borrower"-how do the flood determination rules apply? For example, if the borrower comes in and takes out a 60-day single-pay note. Do we have to do a new flood determination or check the accuracy of the existing flood determination we did when the mortgage was established?
02/17/2003
We are financing the purchase of land with a small cabin on it and taking as additional collateral a piece of property with a mobile home and pole barns on it. The properties are or will be owned by a partnership and will not be owner-occupied. It has been determined that the property with the mobile home and pole barns on it is in a flood zone. The mobile home is not in good condition. No one is living in it. In this case, would the borrower have to get flood insurance on the mobile home?
02/02/2003
We have a customer with a current loan who called and requested a loan for $500.00. The officer ran a credit report and denied the loan on reasons resulting from the credit report. However, the same reasons were there a year ago when we made her a loan. Our loan policies have changed, and as a result, she no longer qualifies. Do we send her a denial using those reasons even though we make the loan before?
02/02/2003
If a customer is paying off a first mortgage with a new home equity line of credit, do we need to disclose the first mortgage payoff in any disclosures?