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I have been reading thru some training material on flood insurance and have a question. If a bank is closing a loan on a mobile home only but the borrower has not determined a location to where they want it moved (preventing us from ordered a flood determination) can the loan close? Then once the borrower determines a location after closing a flood determination can be ordered? I was reading that the borrower flood notice requirements (10 days) do not apply to transactions that close before the permanent location for the mobile home is known. It may be unlikely to happen this way but I wanted to be prepared.
See the 2009 Q&A, number 74: https://www.occ.gov/news-issuances/federal-register/2009/74fr35914.pdf and the proposed Q&As from 2020, number “Notice -2”: https://www.fdic.gov/news/press-releases/2020/pr20077a.pdf.
With all of this information, I think it would be in your bank’s best interest to know where the collateral will be placed and comply prior to closing in order to protect its collateral and avoid compliance issues with out of the norm situations.
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