Is the amount of hazard insurance that should be required on a real estate secured loan calculated as the appraised value less land value or loan amount less land value? Does it differ according to property type?
How do you handle not having an appraisal to assist in the calculation of flood insurance coverage for commercial or residential properties? Does the NFIP mandate that an appraisal be done?
What is the proper method for determining the correct amount of builder's risk coverage required on a real estate construction loan? I’m thinking it should be the "as-completed" appraised value, less the amount of the land, unless the loan amount is less than that. Some lenders want to take the loan amount, net out the land value and insure the loan for the balance. I think the builder's risk coverage should always cover the value of the structure or at least the loan amount. Am I correct? I have found insurance requirement guidelines by HUD for construction of residential property, but nothing as a guideline on commercial real estate construction.
We have a consumer loan that is collateralized by a condo unit. The property is located in a flood zone and the flood and hazard insurance in being paid through the condo association. How do we disclose this on the GFE and the HUD?
When insuring an attached home (condo/townhome) how do you determine the amount of flood insurance? The appraiser listed no sight value, as it is a condo, but each owner is responsible for his or her own structure (roof-to-slab) as opposed to an owner's association. Without the replacement cost of the structure or value of improvements, how do I know how much flood insurance is required for my customer's particular unit?
Do we have to disclose the annual estimated real estate taxes on the GFE and HUD-1? If so, what line should it be listed on?
When collateral property is located in a Flood Hazard Area (and a participating community) we were operating under the impression that the mandatory purchase guidelines required either a NFIP or a WYO flood insurance policy be purchased. We now have someone questioning this since standard Mobile Home Owners policies include flood insurance coverage. Is this type of insurance acceptable to meet the flood requirements? Or are we limited to either NFIP or WYO policies?
If the sellers are paying the borrower's escrows for hazard insurance and taxes, does it matter who gets the aggregate adjustment?
Someone told me that the monthly condo fee must now be disclosed on the Good Faith Estimate and the Settlement Statement as a P/O/C by borrower (line 904) as this is a cost incurred by them at closing. Is this correct? I have not heard this or been able to find documentation of this anywhere. The only time we show the condo fees is on a purchase on the front of the Settlement Statement if it's being pro-rated between buyer and seller. Please advise.
We have been cited during a recent FDIC compliance exam for not including POC costs for hazard insurance and property taxes on the form HUD-1A, when the customer obtains a second-lien home equity type loan. We have never been written up for this before and the fees don't seem to fit in the categories provided on the HUD-1A. Are they really required to be listed?