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If a processor does not obtain a flood determination for the improved real estate collateral prior to loan origination, the exception is identified a determination is obtained after origination, and the property is not located in a SFHA, has a FDPA violation occurred?
Yes, a violation has occurred if you do not obtain the determination until after closing. In order to fully comply with the law you can’t wait until after closing to make the determination. If this property had been in a flood zone you would have multiple violations related to the purchase of insurance and the notice requirement.
It sounds like you’ve already done so, but use this as a learning opportunity. Look for gaps in procedures that allowed for this, use it as a training opportunity, and as the impetus to increase monitoring.
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