You will hear: ·Different types of environmental problems you may encounter ·How to evaluate when there may be a value play ·When you could get a $50,000 discount on a problem that costs $5,000 to fix ·How to manage the environmental issues ·Evaluating the financial risk ·When to walk away ·Evaluations from both the technical and legal perspective Matt Donahue practices law in NH and MA, specializing in business litigation and environmental law.

@Justin Mayet, maybe it's changed, but here is the  following quote for fdic compliance https://www.fdic.gov/regulations/compliance/manual/5/v-6.1.pdf :Amount of Flood Insurance Required The minimum amount of flood insurance required must be at least equal to the lesser of the outstanding principal balance of the loan, the maximum amount available under the NFIP for the type of structure, or the insurable value of the property.Unfortunately, it also states somewhere in there that a lender may require more depending on their own business practices, but cannot require more than the rebuild minus the land. 

Steve Babiak- I would much rather swing by and take a look at their current living situation, but so far it hasn't been practical (at least for the qualified applicants).

I think it's a combination of them not having practical knowledge (compared to a good contractor) and not wanting to be held liable for giving bad advice.After I get more experience, I will probably just inspect it myself.

We are both risk averse and play-by-the rules but also want to be practical and realistic.

Over the past few years, when lending practices became ridiculously loose, many of these renters became homeowners.

I'm sure I'll get tarred and feathered for this, but I'm just returning from a long extending vacation and what a better way to get back into the fray but a healthy debate...I'd like to think that the posters on this forum "could see through the leaves for the trees" but given the media's love affair with bashing the lending industry, I can understand why...Sure loose lending guidelines, predatory lending practices and opportunistic lenders/brokers have an investment in the problem, but so do appraisers who overinflated values, borrowers that misrepresented incomes or miscalculated future earning potential and realtors that pushed the affordability envelope with the upsell---This being said, the sum total of these issues still doesn't hold a candle to the core drivers that seems to be remise from this thread.

to some, it's common practice, but it's risky.if bank finds out they can call your loans due, because you're violating your mortgage agreement.

You also do not want any residual interest like the right to buy after an eviction.Just be careful and make sure you really understand the local and state laws.How you choose to receive payments could cause a problem if it shows that your documented intent was not what you did in practice.

I guess it's possible, but not widely practiced?