Lets all hope Congress does what it needs to do. This is becoming rediculous!
Dear Marie Bost,
Flood Insurance set to expire May 31
Funding for the National Flood Insurance Program is set to expire on May 31. While the National Association of REALTORS is hopeful an extension to fund the program through the end of the year will pass Congress by then, it's important for you and your clients to be prepared for what happens if the program lapses at the end of the month.
A lot of properties are affected as they are required to purchase flood insurance. CTAR estimates 40% of the properties in the CTMLS are in the flood zone requiring flood insurance.
What Are My Options?
In case the program does lapse (it would only affect buyers who can't assume sellers' existing policy), buyers should be working to go ahead and purchase flood insurance before closing -- as permitted, which is usually no more than 30 days in advance of closing.
Also, it's important to re-emphasize what came out of the last lapse in the flood program: although each lending authority notes considerations, the consensus is, in most cases, loan closings may still occur during the NFIP lapse with verification of the submission of a NFIP flood policy application and premium payment submission to the insurance provider.
Lenders should follow all normal flood risk evaluations prior to closing and establish follow up practices to monitor full compliance upon the re-authorization of the NFIP program. Lenders should become familiar with and follow the specific guidance offered by their lending authority.
For more information on the National Flood Insurance Program, please click here.