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#973437 - 06/11/08 08:39 PM Map Amendments
Lu Offline
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Our county has had the flood maps amended. We are now getting notices from our vendor of properties that are now in a flood zone and must have insurance. Is there a 30 day wait period for insurance in these cases? Are we in violation if we don't have flood insurance for 30 days? Can we renew a loan that matures during that 30 days? When are we required to notify the customer of the flood change?

Thanks
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#973481 - 06/11/08 09:02 PM Re: Map Amendments Lu
Andy_Z Offline
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The 30 day waiting period won't be in effect when there is a remapping.

That period is designed to stop someone from calling to get coverage after the storm was just forecast for tomorrow.

When you have a new loan, or a re-mapped area, immediate coverage should be available.
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#973491 - 06/11/08 09:11 PM Re: Map Amendments Lu
In Need of Help 101 Offline
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Our area has also undergone flood map revisions. In reading the NFIP guidelines updated in September of 2007, I too have a question under Appendix 6 regarding the 30-Day Waiting Period. What are they referring to when they mention "During the 13-month period beginning on the effective date of the map revision"...

Are they saying when a map revision is made placing property in a flood zone(when it was previously zoned outside the flood zone) we don't have to have flood insurance for 13 months???

The scenario I am dealing with is that the borrower is now filing for a LOMA on the property/dwelling that is now in a flood zone. It would make sense that until FEMA makes their decision on the LOMA (which could take a year) that the borrower would not have to obtain flood insurance. But, I think I have also read where they could receive a full refund of any premiums paid if FEMA approves the LOMA.

HELP!!! I am so confused.

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#973507 - 06/11/08 09:33 PM Re: Map Amendments In Need of Help 101
Lu Offline
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We also have the same situation. The customer construction loan has matured but he has filed a LOMA. Can we renew his loan w/o flood insurance?
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#973519 - 06/11/08 09:49 PM Re: Map Amendments Lu
Andy_Z Offline
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When you now know it is in a SFHA you must get the insurance prior to renewal. When it changes in mid-loan, it is a gray area at best. Life of loan monitoring is a "voluntary" act and is an investor/buyer requirement. The other side of the coin is, if you know and don't advise them or protect your assets, what if they flood and sue you? Likely your loan docs say they'll get required insurance.
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#973542 - 06/11/08 10:33 PM Re: Map Amendments Andy_Z
mnlender Offline
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Also, no LOMA on an individual property should take more than 60 days review. Most I've seen take less than two months.
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#973762 - 06/12/08 01:47 PM Re: Map Amendments Andy_Z
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Can anyone explain the 13 month period that is referred to in the Flood Guidelines, Appendix 6?

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#973788 - 06/12/08 02:10 PM Re: Map Amendments In Need of Help 101
Dan Persfull Offline
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Bloomington, IN
As I understand this; if a person applies for flood insurance within the 13 month period after the remapping the 30 day waiting period is waived. If applied for in the 14th month then the 30 day waiting period is in effect except for those exemptions given in connection with a loan against the property.

You are not required to monitor your portfolio, and a remapping is not a tripwire for you to review your portfolio, but once you become aware the property is located in a SFHA, either by a portfolio review or a LOL monitoring notification, you must notify the borrower of the need to get flood insurance. See page 5 of the MPFIG

During the term of the loan, ensure that flood insurance is maintained or obtained if the lender becomes aware that the building involved subsequently becomes part of an SFHA; and

Until FEMA issues the LOMA/R your borrower must obtain flood insurance. If FEMA issues the LOMA/R then the full premium will be refunded to your borrower.
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