The NCUA and other financial services regulators are seeking public comment on revised interagency questions and answers on flood insurance.
These are an update to the first Q&A published in 2007, and they also contain some proposed rules changes. One such change would permit lenders to allow borrowers to defer the purchase of flood insurance until a foundation slab has been poured and/or an elevation certificate has been issued. Lenders choosing this option, however, must require the borrower to have flood insurance in place before funds are disbursed to pay for building construction on the property securing the loan.
The proposed changes also include substantive modifications to Q&A pertaining to second-lien mortgages, the imposition of civil money penalties, and loan syndications and participations.
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Comments are due by Sept. 21. In addition to the NCUA, the rules are being issued by the Federal Reserve, the FDIC, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the Farm Credit Administration.
For a full copy of the proposals go to http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20090721a1.pdf
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