Notice
of Special Flood Hazards
and Availability of Federal
Disaster Relief Assistance
We are giving you
this notice to inform you that:
The building or mobile home securing the loan for which
you have applied is or will be located in an area with special flood
hazards.
The area has
been identified by the Director of the Federal Emergency Management
Agency (FEMA) as a special flood hazard area using FEMA’s Flood
Insurance Rate Map or the Flood Hazard Boundary Map for the following
community:
. This area has a one percent (1%) chance
of a flood equal to or exceeding the base flood elevation (a 100-year
flood) in any given year. During the life of a 30-year mortgage loan,
the risk of a 100-year flood in a special flood hazard area is 26
percent (26%). Federal law allows a lender and borrower jointly to
request the Administrator of FEMA to review the determination of whether
the property securing the loan is located in a special flood hazard
area. If you would like to make such a request, please contact us
for further information.
The community
in which the property securing the loan is located participates in
the National Flood Insurance Program (NFIP). Federal law will not
allow us to make you the loan that you have applied for if you do
not purchase flood insurance. The flood insurance must be maintained
for the life of the loan. If you fail to purchase or renew flood insurance
on the property, Federal law authorizes and requires us to purchase
the flood insurance for you at your expense.
- At a minimum, flood insurance purchased must cover the lesser of:
-
Flood insurance coverage under the NFIP is limited to
the building or mobile home and any personal property that secures
your loan and not the land itself.
- Federal disaster relief assistance (usually in the
form of a low-interest loan) may be available for damages incurred
in excess of your flood insurance if your community’s participation
in the NFIP is in accordance with NFIP requirements.
- Although you may not be required to maintain flood
insurance on all structures, you may still wish to do so, and your
mortgage lender may still require you to do so to protect the collateral
securing the mortgage. If you choose not to maintain flood insurance
on a structure and it floods, you are responsible for all flood losses
relating to that structure.
Availability of Private Flood
Insurance
Coverage
Flood insurance
coverage under the NFIP may be purchased through an insurance agent
who will obtain the policy either directly through the NFIP or through
an insurance company that participates in the NFIP. Flood insurance
that provides the same level of coverage as a standard flood insurance
policy under the NFIP may be available from private insurers that
do not participate in the NFIP. You should compare the flood insurance
coverage, deductibles, exclusions, conditions, and premiums associated
with flood insurance policies issued on behalf of the NFIP and policies
issued on behalf of private insurance companies and contact an insurance
agent as to the availability, cost, and comparisons of flood insurance
coverage.
[Escrow Requirement for
Residential Loans
Federal law may require a lender
or its servicer to escrow all premiums and fees for flood insurance
that covers any residential building or mobile home securing a loan
that is located in an area with special flood hazards. If your lender
notifies you that an escrow account is required for your loan, then
you must pay your flood insurance premiums and fees to the lender
or its servicer with the same frequency as you make loan payments
for the duration of your loan. These premiums and fees will be deposited
in the escrow account, which will be used to pay the flood insurance
provider.]
Flood insurance coverage under
the NFIP is not available for the property securing the loan because
the community in which the property is located does not participate
in the NFIP. In addition, if the non-participating community has been
identified for at least one year as containing a special flood hazard
area, properties located in the community will not be eligible for
Federal disaster relief assistance in the event of a Federally declared
flood disaster.
