We just ran into a situation that may be the start of new guideline changes! The file was sent to a major lender and they were getting ready to decline the deal since the master fire insurance policy did NOT read: “100% Replacement Cost” or “Guaranteed Replacement Cost”. YIKES… I’m not sure if insurance companies will write policies with this type of language!
Since we have multiple lending sources, we checked with another major lender and to our surprise, they just recently changed their guidelines in a similar manner! Not good news. We did find a solution BUT it was a very difficult set of action items. Consumers beware!
So… A) Is this another new trend in tightening guidelines? B) Most Loan Officers simply would not have been able to solve this problem. Pick your Loan Officer wisely! C) Has anyone else found this to be the case or am I the lucky person who ran into this first?