Got flood insurance?

Although strangely mis-titled, this article has some good info about flood insurance.   Banks are required by regulators to carefully check the flood determination zone of every property it loans on.


From Consumerist.com:

For the last few years, the folks at the Federal Emergency Management Agency have been issuing more accurate flood plain maps at the same time as the government has made a renewed push for mortgage lenders to help make sure homeowners who need flood insurance are actually purchasing it. But even though these new maps should be making it more clear to everyone whether or not one's home is in a flood plain, the banks appear to be playing fast and loose with the rules in order to force customers into more expensive insurance policies.

See, while part of your property might be in a Special Flood Hazard Area, that doesn't necessarily mean you need to purchase flood insurance. The insurance is only required if your actual house falls within that zone.

So if your house is far from that lake, creek or river or is high up above the area that could flood, you should not have to purchase the insurance. Problem is, as these new maps get around, banks are taking only cursory glances at them and not always checking to see where a house might be before deciding that flood insurance is needed.

Usually, banks give homeowners 45 days to provide proof of insurance. After that, the bank will just put you into a policy of its choosing -- one that is often significantly higher in price than what you'd pay if you bought it yourself.
Homeowners can appeal to FEMA, though that process will likely require 60 days. By that time, they will have either needed to find their own insurance or be placed into one by their lender.

Read more here.   http://consumerist.com/2012/07/its-not-in-banks-best-interest-to-look-too-closely-at-new-flood-plain-maps.html