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Just to confirm for TRID home loans is a co-signer considered an applicant and yes we would collect government monitoring? We were thinking a co-signer was not an applicant.
I wanted to further confirm on the amount of flood insurance required on pavilion with a storage area that I listed in my question in my previous post. If the old one is tore down and replaced and we do a second mortgage on this RV Park how do we determine the updated flood coverage amount required on the pavilion if we don’t do a new appraisal? The other appraisal is approximately a year old. We talked to the original appraiser and he said with the improvements they wanted to do would maybe at the most increase the value of the property by $50,000. Do we need to obtain a construction bid list and that will be the new amount required for flood insurance? Sorry this is such a complicated post. Many variables.
We are a non-HMDA bank. According to Reg B we are to collect GMI for loans to purchase or refinance a dwelling occupied or to be occupied by the applicant as their principal residence and is secured by the dwelling. If a borrower is doing a refinance with their primary residence as collateral but the loan that is being refinanced is unsecured do we collect the GMI? What if the unsecured loan was for the initial purchase of the home? What if the unsecured debt was for personal reasons NOT to purchase the home? I wanted to confirm if we collect it if either scenario comes up.
We give the Notice of Free Choice of Agent and Insurer & Disclosure with Respect to Title Insurance Disclosure for our loans that the customer purchase title insurance. We were told by the insurance company years ago that these two disclosures were to be given on any loan, consumer and business purpose loans, that is secured by property with a 1 – 4 family dwelling ONLY. That the loans that were secured by land or a commercial building they were not required to be given. Now the newer representative at our title insurance company is saying that ANY loan that we sell title insurance on (no matter what the collateral is) we DO have to give these two disclosures but she says she is not a compliance expert either…. Can you tell me what type of loan these 2 disclosures are require to be given on?
I was wondering if a bank receives a flood insurance policy for insufficient coverage amount and will need to force place coverage, do we force place the whole amount of coverage needed or only the difference in the amount that is required minus the amount of coverage on their policy? For example, $150,000 is what is required but the borrowers insurance policy is only $130,000. Would you force place $20,000 or the $150,000?
I have a loan in the amount of $44,000 on 4 residential lots and will be written for 12 months (temporary loan). The four lots are worth $12,000 apiece. There are exemptions in Dodd-Frank on not needing to have an appraisal. One exemption is TEMORARY BRIDGE LOAN (FOR TWELVE MONTHS OR LESS). Does that mean no appraisal OR evaluation needs to be completed?
I apologize in advance for this long post. I have 2 questions. We have a recently closed large loan with a commercial building in a RV park and I think they are over insured on their FEMA flood policy. The cost approach within the appraisal did not indicate the cost of the building. Appraisal says 40% depreciation and I verified with appraiser that the 40% applies to that building. I asked him to help with a value for flood insurance and he wouldn’t because his E & O insurance guy tells them not to because they could be liable if it’s wrong. The replacement cost per hazard policy is $230,000 Flood policy was originally written for $225,000. I calculated coverage $141,200 after adding in the cost of the foundation to the replacement cost and deducting 40%. I told the insurance agent that on a commercial building FEMA will only pay ACV and they are over insured. He said it would be best to leave the value as is because of coinsurance. If the amount is lowered below 80% and they have to make a claim the customer will be penalized for not having enough insurance. After doing research I’m wandering if he’s thinking of the 80% rule for a dwellings. Dwellings are to be insured within 80% of their replacement cost or they are penalized. Does this apply to commercial buildings too? Then I wander, is he saying that once a policy is in place it can only lowered by 20%? Can a flood policy be lowered by more than 20% down to the ACV and NOT get penalized?
Second issue, the policy was rewritten to a policy that would grandfather in the property and reduce the premium. In the transition something was messed up and we have received a letter from the new insurance company that because they have not received the premium their coverage is even lower to $114,700. They are to pay the premium difference and their coverage will go to $230,000. Looks like insurance agent increase the coverage by $5,000 from the original policy and matches the amount on the hazard policy.
Now I have to write the 45 day letter to the customer because its insufficient and include in the letter an amount for the minimum coverage needed. Do I put my calculation of $141,200 or the original policy of $225,000; or the new policy amount of $230,000?
I want to tell the customer they are over insured but I don’t want them Under insured and be penalized when they making claim. I also don’t want to get into a safety and sound issue for the loan either. There are already 2 other buildings on the property that were deemed uninsurable by the agent. They are 2 Amish style sheds, premade buildings that are purchased and moved to the location, that are not affixed to the ground by foundation. We did receive pictures from him. One picture shows nothing placed around the bottom outside edge to the ground and looks to be resting on concrete blocks way underneath that is resting upon blacktop. The other building has something around the bottom edge,looks like concrete blocks. They are staggered so it is shown not a solid foundation. We have received written confirmation from the agent that “ 2 Amish style buildings are not affixed to the ground via foundation.”
If it can be lowered without them being penalized can you give me advice on who I need to consult to get this lowered. Call FEMA?
I have a loan in the amount of $44,000 on 4 residential lots and will be written for 12 months (temporary loan). The four lots are worth $12,000 apiece. There are exemptions in Dodd-Frank on not needing to have an appraisal. One exemption is TEMORARY BRIDGE LOAN (FOR TWELVE MONTHS OR LESS). Does that mean no appraisal OR evaluation needs to be completed?
I am following up on a reply you gave me on December 17th about flood insurance. (Your Reply #33124) In talking to the insurance agent the property has 2 “Amish” sheds. The kind that are already built elsewhere and is purchased and moved to the new location. They are set upon blocks underneath and are not affixed to a foundation. He did email me pictures and so you can see they are the prebuilt sheds that can be purchased and moved. One shed has nothing between the ground and the bottom outside edge of the building so you can see there is no foundation. The other building has covering at the bottom edge of the building for looks. It looks as though it is concrete blocks. The insurance agent did give me something in writing that the 2 Amish style sheds are not affixed to the ground per via foundation. Therefore we are telling the borrower that since it is not an “Eligilbe Building” per foundation that we are not requiring flood insurance. There are contents valued at approximately $18,000 in the building. Because the building is not insurable does that make the contents inside the building not insurable too?
We have a commercial loan that the commercial building is in a SHFA. It is a specialty property and the appraisal is not specific on what the cost estimate is on this building therefore I am looking at the replacement cost on the hazard insurance policy. I asked the appraiser for help on the amount for the flood policy but he didn’t want to be liable. I know we are to add to that an amount for the cost of the foundation. We have asked a local contractor to give us an estimate for the foundation. He has given us a verbal amount for the material and an amount for the labor. Once I add those figures together I would deduct 40% depreciation that was shown on the cost approach page on the appraisal. (I think I am calculating this correctly) Is it acceptable to just document in the file that we got a verbal amount from a local contractor on the foundation or do I need to document in a different way?
I have a commercial property secured loan that is in a SHFA. The real estate and equipment/contents are security for the loan. The insurance agent is telling me that 2 of the buildings that house some of the collateral for the loan do not have much and one doesn’t have a foundation. He said he doesn’t recommend flood insurance because of that. The fema.gov/pdf/nfip manual says that an “Eligible building” has to be affixed to a permanent sight, must resist flotation, collapse, and lateral movement. So I am thinking the one building that doesn’t have a foundation would not be insurable right? Also, if that building is deemed uninsurable for flood insurance because of no foundation or a very bad foundation will the contents be able to be insurable for flood insurance?
One other question? If the building is deemed uninsurable how do we back that up in our file? Can the insurance agent write a letter stating why it is not insurable? I have concern that I thought I have read something that even if the building is not insurable that you may have to insurance it for clean up though?
I have a commercial property secured loan that is in a SHFA. The real estate and equipment/contents are security for the loan. The insurance agent is telling me that 2 of the buildings that house some of the collateral for the loan do not have much and one doesn’t have a foundation. He said he doesn’t recommend flood insurance because of that. The fema.gov/pdf/nfip manual says that an “Eligible building” has to be affixed to a permanent sight, must resist flotation, collapse, and lateral movement. So I am thinking the one building that doesn’t have a foundation would not be insurable right? Also, if that building is deemed uninsurable for flood insurance because of no foundation will the contents be able to be insurable for flood insurance?
I have a question about what to include when determining the amount on flood insurance for contents/fixtures coverage for my instance on a commercial loan. I know you would account for any equipment, appliances, etc. bigger items but what about the miscellaneous small items? For example I have a commercial loan that has a “simple” mom and pop store/shower house on a RV campsite. As well as a small garage that houses mowers, weedeater, items to take care of the grounds. Do you have to include a value for items say in the store building for items such as staplers, trash cans, clocks on the wall, mirrors on the wall in the shower house part, etc.? And for the garage would you include a value for miscellaneous small items such as bottles of oil, gas can, etc. I see a previous post from June 2019 that had a link to further explain contents coverage but the included links would not work.
Thank you!
We have a commercial loan that has 3 structures located in a flood zone and the loan amount is more than what the ACV of the combined structures. The appraisal is not specific in the cost approach on what the depreciated amount of one of the structure is. When we look to the hazard insurance policy it gives a replacement cost of the commercial building. Is there any way to determine the ACV that FEMA will only pay on a commercial building using that RCV? Any suggestion would be appreciated.
