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#1726806 - 08/02/12 04:09 PM Biggert-Waters Flood Insurance Reform Act of 2012
ComplianceGrl15 Offline
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Registered: 04/18/11
Posts: 254
Does anyone know when the provisions of this Act will be implemented??

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Flood Compliance
#1726839 - 08/02/12 04:56 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
KPOC Offline
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Registered: 07/09/12
Posts: 460
Loc: Greater Boston Area
This doesn't really help, but according to the ABA Staff Analysis, "the effective date of many of the amendments is unclear".

We are just familiarizing ourselves with what will change so we can react when the dates start getting released.

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#1729063 - 08/09/12 08:14 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
ItsJustMe Offline
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Registered: 12/16/09
Posts: 123
Loc: New York
I'm getting hounded by staff wondering what the compliance dates are with these new provisions...it certainly would be nice if they were clear about things if they want us to comply.

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#1729079 - 08/09/12 09:04 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
mdog76 Offline
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Registered: 01/30/07
Posts: 123
One provision states: A requirement that a notice by given to all borrowers of loans secured by improved real estate, whether the real estate is or is not in a designated flood hazard area, that flood insurance is available from the NFIP or from a private company.

So the institution must let the borrower know with a new disclosure that insurance is available to them even if their property is not in a flood zone?

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#1729169 - 08/09/12 11:05 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
ahou Offline
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Registered: 08/15/02
Posts: 2695
Yes under a RESPA amendment
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#1729516 - 08/09/12 08:22 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ItsJustMe]
rlcarey Offline
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Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
Originally Posted By: Joyce AJK
I'm getting hounded by staff wondering what the compliance dates are with these new provisions...


Tell them as soon as the effective dates and implementing regulations are announced, they can be assured that you will let them know. In the mean time, they should ensure that they continue to follow Bank policies and procedures to the letter as they can rest assured that the $2,000 per violation penalty will be considered in effect as the day of passage of the law.
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#1729520 - 08/09/12 08:53 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
Kathleen B Online

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Posts: 17348
I agree with Randy. The penalty increase needs no implementation as it is simply an immediate change to the statute, the remainder awaits guidance from FEMA and FEMA has to get clarification from Congress on some matters, change many processes, etc. before announcing implementation of the rest of the changes (notices, changes to coverage, new escrow requirements, etc.)
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Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1729887 - 08/10/12 04:33 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
ItsJustMe Offline
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Registered: 12/16/09
Posts: 123
Loc: New York
I just received an email from FEMA. The new SFHDF will not be required to be used until May 30, 2015 - the renewal date of the form. Their web site will be updated in a couple of days with this information.

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#1729904 - 08/10/12 05:11 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ItsJustMe]
WI Banker Offline
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Registered: 12/26/06
Posts: 252
Originally Posted By: Joyce AJK
The new SFHDF will not be required to be used until May 30, 2015 - the renewal date of the form.


That's the expiration date of the new form.

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#1729912 - 08/10/12 05:30 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
ComplianceGrl15 Offline
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Registered: 04/18/11
Posts: 254
Okay, so now it seems as if we will have 3 disclosures to worry about?

One for all improved properties no matter if they are located in a SFHA or not - RESPA Ammendment

The new one stating that private insurance is available and for the consumer to check the price difference b/t private and NFIP.

And then the Notice of Special Flood Hazard Area for properties located in a SFHA for participating and non-participating communities.

Right??? Or will the old Notice of Special Flood Hazard Area disappear???

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#1729947 - 08/10/12 11:01 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
Kathleen B Online

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Registered: 12/27/00
Posts: 17348
But not until instructions are issued!
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Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1729968 - 08/11/12 08:00 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
rlcarey Offline
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Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
I agree with KB. This is like speculating what the final version of the TIL/RESPA disclosure was going to look like a year ago. Concentrate on known issues (god knows there are enough of those) and don't worry about the unknown until we have some guidance issued.
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#1737651 - 09/04/12 12:06 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: rlcarey]
sewanee, CRCM Offline
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Registered: 12/07/06
Posts: 405
Loc: TN
ABA has issued a Staff Analysis which does a good job of breaking down the pieces of the Act and the expected effective dates. If you're a member, you can access it at:

http://www.aba.com/Solutions/Compliance/Mem/Documents/SABiggertWatersFloodInsuranceReform2012.pdf
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#1749357 - 10/15/12 03:19 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
MB Guy Offline
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Registered: 05/26/04
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Not a member, can someone give a synopsis?
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#1749374 - 10/15/12 04:20 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
Kathleen B Online

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Registered: 12/27/00
Posts: 17348
Just google aba staff analysis biggert waters
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Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1750388 - 10/18/12 01:57 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
MB Guy Offline
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Registered: 05/26/04
Posts: 9879
Loc: Toes in the sand...
Q: Do banks now HAVE to accept private flood insurance, or is it merely OK to accept private flood insurance?

I have researched and have gotten opposing viewpoints, thanks.
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#1754588 - 11/02/12 12:05 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: Kathleen B]
SouthoftheBorder Offline
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Registered: 02/14/02
Posts: 333
Loc: The South
used your google suggestion - still needs a user name and password - we're not a member of ABA cry

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#1754619 - 11/02/12 12:51 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
Gatorgirl Offline
Member

Registered: 06/18/07
Posts: 55
Loc: Florida
For more details on the Biggert-Waters Flood Insurance Reform Act you may go to the link listed below. The flood portion of the bill begins on page 512.

http://www.gpo.gov/fdsys/pkg/BILLS-112hr4348enr/pdf/BILLS-112hr4348enr.pdf

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#1755847 - 11/07/12 09:37 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
lvc Offline
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Registered: 07/11/07
Posts: 904
I just received a white paper from our Internal Auditor that states the following:

1. The maximum insurance available for multifamily dwellings has been increased to $500,000. I assume this amount is per building so my question is how can we calculate insurance for a unit owner?

2. In connection with any loan subject to RESPA regardless of property location or flood hazard, lenders must provide borrowers with a notice (as part of the RESPA) disclosures that flood insurance is available through the federal program or a private insurance co. Does this mean we would have to provide this notice to a loan subject to RESPA that is not in a flood zone? I assume we have to wait until the CFPB amends RESPA in order to comply. Is this correct?

3. As an alternative to the federal program, flood insurance policies issued by insurance companies that provide the same coverage as is available under NFIP and which satisfy the requirements of Freddie Mac and Fannie Mae must be accepted by lenders. Note that a notice provided to borrowers with RESPA disclosures appears to satisfy this requirement. According to the white paper this change is effective immediately. How are other banks satisfying this requirement?


Edited by lvc (11/07/12 09:40 AM)

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#1755854 - 11/07/12 09:58 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
rlcarey Offline
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Registered: 07/16/01
Posts: 49739
Loc: Galveston, TX
I think the white paper is jumping the gun just slightly. I am not aware of any guidance that has been issued on any of these issues by the regulators or the NFIP.
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#1755864 - 11/07/12 10:03 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
lvc Offline
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Registered: 07/11/07
Posts: 904
I'm not aware of any guidance being issued either.

I fowarded the same questions to the Internal Auditor and I'm waiting on their response.

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#1755865 - 11/07/12 10:03 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
Kathleen B Online

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Registered: 12/27/00
Posts: 17348
Right, guidance is supposed to be coming. FEMA even said that they were going back to Congress with questions on some issues.
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Kathleen Blanchard CRCM "Kaybee"
Lending/CRA/HMDA/Mapping/Consulting
www.kaybeescomplianceinsights.com

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#1757938 - 11/14/12 01:19 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: sewanee, CRCM]
bOaty Offline
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Registered: 08/01/06
Posts: 4006
Loc: Heading to Tahoe!
Originally Posted By: sewanee
ABA has issued a Staff Analysis which does a good job of breaking down the pieces of the Act and the expected effective dates. If you're a member, you can access it at:

http://www.aba.com/Solutions/Compliance/Mem/Documents/SABiggertWatersFloodInsuranceReform2012.pdf


Thanks sewanee, after reading the whitepaper, I was going to start amending our P&P's. Glad that the ABA laid this out more clearly.

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#1762610 - 11/29/12 05:29 PM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
YosemiteSamIAm Offline
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Registered: 01/29/04
Posts: 2708
Loc: Bizarro World aka Obamaville
So here's a wrinkle for all. Chase is requiring that the language on availability of private flood insurance be in a notice given to customers starting for applications taken 1/1/2013. Even when I pointed out that the notice is not yet effective, they said that "the Act has passed and we expect you to be compliant." So, I asked to see a copy of the noitce they are giving their customers...so far, crickets...what kind of *%^)(*&*& compliance attorneys do they have working for them that don't understand that just because an Act was passed does not mean the provisions must immediately be complied with?!
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#1762800 - 11/30/12 10:50 AM Re: Biggert-Waters Flood Insurance Reform Act of 2012 [Re: ComplianceGrl15]
YosemiteSamIAm Offline
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Registered: 01/29/04
Posts: 2708
Loc: Bizarro World aka Obamaville
I don't see anything in the Act that the notice regarding availability of private flood insurance needs to be signed, is that correct? Thanks!
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