If you’re new to real estate lending, the concept of flood insurance is also probably quite new. In a nutshell, if you make, increase, renew, extend, etc., any loan secured by a building or mobile home that is located or to be located in a special flood hazard area (Zone A or V), you must require that the building or mobile home and any personal property securing the loan is covered by flood insurance for the term of the loan. There are some instances where flood insurance is not available through the National Flood Insurance Program (NFIP) and therefore you don’t have to require it. Once such instance is in the case of non-participating communities. Keep in mind; however, that just because flood insurance isn’t available to purchase for non-participating communities, it doesn’t mean that other flood insurance requirements (flood determination, notice, etc.) also don’t apply.
Jerod explains more in the video.
Published
2024/04/11
