For properties in Flood Zones A or V, post-FIRM we are being told that insurance is available for a period of one year pending the completion of an Elevation Certificate by a qualified surveyor. Absence of the EC results in extremely high premiums. At the end of the one year, the National Flood Insurance Program will not renew the policy without the EC.

Is anyone else running into this problem? It would seem to effect all lenders/borrowers since it is a national program. This came to light at our bank as we are trying to forceplace insurance and are not able to without the EC.

I've heard of this for construction loans, but have not run into any problems for other type loans. May have just been lucky to date.

I didn't do any search on this. Do you know where this is coming from as for as FEMA is concerned?

The agency through which we forceplace our insurance has researched with FEMA and has confirmed from numerous contacts that this is the way it is going to be. I'm not terribly interested in stirring the pot, as our borrowers are able to obtain the coverage without the EC. But, what happens in one year when the policy can't be renewed?

I'm going to have to do some catch up reading to see where this is coming from. It may be in the policy releases that came out which I have not read yet. Another reason I may have not have run into the problem is the majority of our loans have surveys.

In one year, with the scenario you are describing, you will have to obtain a survey with the elevation certification. The cost should be passable to the borrower via your note and/or mortgage.