Appendix A to Part 36 - Sample Form of Notice of Special Flood Hazards and Availability of Federal Disaster Relief Assistance
38:2.0.1.1.10.7.349.1.6 : Appendix A
Appendix A to Part 36 - Sample Form of 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 at least 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
Director 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.
• 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 also may be available
from private insurers that do not participate in the NFIP.
• At a minimum, flood insurance purchased must cover the lesser
of:
(1) the outstanding principal balance of the loan; or
(2) the maximum amount of coverage allowed for the type of
property under the NFIP.
Flood insurance coverage under the NFIP is limited to the
overall value of the property securing the loan minus the value of
the land on which the property is located.
• 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.
__ 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.
(Authority: 42 U.S.C. 4104a) [62 FR 5534, Feb. 6, 1997]