Land Only Flood Determination Policies

Land Only Policy:

Defined as: A vacant, unimproved parcel of land; can also be used for an improved parcel where the borrower is going to take down the existing structure in order to build in its place. No insurable structure on the property (bare/raw land).

The Flood Determination is done stating whether any part of the entire property is touching a flood zone, even if a proposed building location might be outside of the flood zone.
- If Yes, we send the entire Flood Cert back as IN, and include the words “Land Only” in the comment section.
- If No, we send it back as OUT, but include the parcel number or legal description if there is no physical address assigned yet. Include the words “Land Only” in the comment section.

Interagency Q & A Regarding Flood Insurance

http://www.fdic.gov/news/news/press/2011/pr11163a.pdf or

http://www.gpo.gov/fdsys/pkg/FR-2009-07-21/pdf/E9-17129.pdf

Excerpts:

IV. Flood Insurance Requirements for Construction Loans 19.

19. Question: Is a loan secured only by land that is located in an SFHA in which flood insurance is available under the Act and that will be developed into buildable lot(s) a designated loan that requires flood insurance?

Answer: No. A designated loan is defined as a loan secured by a building or mobile home that is located or to be located in an SFHA in which flood insurance is available under the Act. Any loan secured only by land that is located in an SFHA in which flood insurance is available is not a designated loan since it is not secured by a building or mobile home.

National Flood Insurance Program: Answers to Questions About the NFIP FEMA F-084 / March 2011. pg 10

http://www.fema.gov/library/viewRecord.do?id=1404

29. Question: What kinds of property are not insurable under the NFIP?

Answer: Buildings entirely over water or principally below ground, gas and liquid storage tanks, animals, birds, fish, aircraft, wharves, piers, bulkheads, growing crops, shrubbery, land, livestock, roads, machinery or equipment in the open, and most motor vehicles are not insurable through the NFIP.