FEMA requires we determine the need for flood insurance when we make, extend or renew a loan but I am struggling with whether we need to get a new flood cert when we extend or modify a loan. We have the LOL Flood Cert but does that cover extensions and modifications or are we required to get a new determination.

I would first suggest checking with your flood determination company to see whether using the LOL coverage on an extension or modification would invalidate any agreements with them.

As Sewanee suggests check your contract for their requirements on a the re-use of the determination, however under the Law regardless whether you have LOL monitoring or not if there has been a map change or the determination is 7 years old or older you must obtain a new determination when you M.I.R.E. a loan.

Just to clarify Dan (I think I confused myself over your statment):

We use LOL monitoring on every determination we pull, regardless of if its in a SFHA or not. Our area has just had all of its maps updated. So my question is: do we need to be pulling new flood determinations on ALL of our files at time of renewal since we know that the maps were updated (regarldless of if they were previously in a SFHA or not and regardless of the age of the det. ie: less 7 years)?

What good is the LOL monitoring if we have to monitor for map revisions ourselves and pull new determinations?

LOL monitoring is to notify you when the property moves from not being in SFHA to being in one or vice versa. Depending on your vendor they may or may not notify you of a map change if it doesn't affect the status of the property.

If you sell to Fannie or Freddie and retain servicing you are required to have LOL monitoring. But it is not a regulatory requirement.

A map revision does trigger a new determination regardless is the determination is less than 7 yrs old.

It is our vendors responsibility (guarantee) to notify us when a property moves from not being in SFHA to being in one or vice versa (a map change/revision is the only way that could happen though right?)

But if I'm understanding your correctly you are saying that even if you know the property is nowhere near the flood zone on that county map, since the map was revised, we need to pull all new determinations. Correct?

Because a map has been revised does not necessarily mean the property's status has been affected by the revision.

Again check your contract. Yes they must notify you of a status change in the property, but if there is no status change they may have no responsibility at all to notify you of a map change.

But either way it's your responsibility and a defense of we didn't know the maps changed because our vendor didn't notify us will not hold water.

If you M I R or E a designated loan then you are required to get a new determination if it is 7 years old or older, there has been a map change or if for some reason the determination is not on the SFHDF.

FWIW, I agree with what all Dan has said...in addition, realize that your vendor can be very late in sending notification to you when a property is now in a zone...

All LOL means to me is, is that as long as that loan just sits on the books performing? I don't worry about it. If something is done with that loan? There is going to be some action on my part regarding flood...at a minimum verifying whether or not the map has changed...further action as necessary if that answer is yes.

Ok, I understand. Thank you. I guess I just wasn't liking what I was hearing since it will mean we will have to pull A LOT of new determinations.

We are a bank that only does balloon loans for mortgages....lots of M I R E happening. Just means job security right?

Don't feel alone, illiniyak...we do too!

Years ago we decided that if we breathed (or at least MIREd) on a loan with improved RE, we'd pull a new determination. Safest way to go,and they are not that expensive to pull. The way to success in compliance is to standardize as much as possible for staff so they don't have to think. If you give them the option of pulling flood or not, you increase the likelihood that some will slip through the cracks.

RR Joker is correct. It may take your vendor a while to notify you of a change. Check your contract to see how much time they have to notify you. They may have up to 60 days (or more). It may be safer to pull a new determination if you are aware of changes in the area where the property is located.

As Moman says - determinations are cheap.

jlr -

Check with your vendor regarding "re-certification" of the LOL certification. Our contract includes unlimited recerts at no charge.

LOL means for the life of that loan. Our vendor tracks by loan number. Therefore, anytime we have an event that results in a new loan number, we do a "related loan" request that then ties LOL coverage to the new loan number.

When I know a map has been revised and we are doing something with the loan and we do not have an updated determination form reflecting the new map, I just contact our flood determination company. Since we have LOL coverage, they will send us an updated determination at no cost.