(Originally published 10/30/12.)
I hope everyone made it through Hurricane Sandy with minimal damage.
As a result of Hurricane Sandy, and in reference to your clients who are currently in contract but have not yet closed, virtually ALL lenders will be requiring some assurance that these subject properties were not adversely impacted by the storm. This will apply to ALL properties and property types. Underwriting will require this necessary documentation prior to scheduling a closing.
Therefore, in order to minimize delays, adjourned closings, expired rate locks, and angry clients, it would be wise to anticipate these new lender requirements:
- For properties in zip codes that will eventually be designated as Disaster Areas, lenders will require an appraisal reinspection that includes the following:
- A statement by the appraiser that the subject property has not sustained any flooding and/or windstorm damage.
- A statement from the appraiser on the neighborhood conditions as they relate to flooding and/or windstorm damage.
- A photo or photos of the subject property.
- For properties in zip codes NOT critically impacted by the storm:
- Lenders may still require an appraisal reinspection as described above.
- Lenders may simply require a signed certification from the borrower that the property was not adversely affected by the storm, that there is no damage, and they wish to proceed with the transaction.
By anticipating these new measures (even if your borrower’s loan originator doesn’t), you can proactively ask these questions, avoid any delays, and come out looking like the hero.
If anyone has any questions feel free to contact me.
Warren Goldberg is a Certified Mortgage Planning Specialist and a published author. His interviews include Blog-Talk Radio, Newsday, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.