Flood Diaster

Question 1

What loans are covered by the flood act

Answer 1

All loans secured by a

Building

Mobile home

Including increases, extensions, refinances and renewls locates or to be located in a SFHA

Question 2

What is the flood act triggered by

Answer 2

The collateral, not the purpose of the loan

Question 3

Exemptions from Flood are

Answer 3

Loans with balance $5k or less

Property that is part of a residential structure but detached

State owned property covered by self insurance

Question 4

The flood regulation applies to loans where the property is in a SFHA but the community does not participate in the

Answer 4

National flood insurance program

Question 5

Lenders may not make a government guaranteed or insured loan secured by improved property in a

Answer 5

SFHA unless the community participated in the NFIP

Question 6

What type of building uses are excluded from the flood regulation

Answer 6

Agricultural

Commercial

Industrial

Other business purposes

Question 7

What type of residential building uses are included in the flood regulation

Answer 7

One to four family dwelling

Apartment buildings with more than 4 units

Hotels where people stay six months or more

Rooming houses with four or more people

Question 8

What type of non residential building uses does the flood regulation cover

Answer 8

Building for small business 
Churches
Schools
Farm building 
Pool houses
Clubhouse 
Warehouse 
Nursing homes

Question 9

What flood rate increases can residential property have that is not the primary residence

Answer 9

25%

Question 10

Primary residences can have flood rate increases from

Answer 10

5 to 25 percent

Question 11

What is FEMA flood surcharge

Answer 11

25 for primary residences

250 for other types of property

Question 12

If a property is no longer in a SFHA due to a map change what can a lender do

Answer 12

Drop the requirement

Question 13

Who is responsible for determining if a property is in a SFHA and if flood insurance is available

Answer 13

The lender and they must use NFIP maps to determine thi

Question 14

If a third party is used to determine if a structure is in SFHA the lender must

Answer 14

Ensure that it is done to their satisfaction

Question 15

Is the flood insurance determination fee a finance charge under reg z

Answer 15

No, but fees for the life of the loan are considered to be

Question 16

What type of form should a bank use to document if the improved real estate is in a flood area

Answer 16

Standard flood hazard deter nation form

Question 17

When can a previous determination be used when making a new loan

Answer 17

It is less than seven years old

There are no map revisions

It was intially recorded on the SFHDF form

Question 18

If an institution acquired a loan from a mortgage broker or third party, are they held accountable for flood regulations

Answer 18

Yes However if it is a loan purchase or participation it does not trigger regulatory requirements

Question 19

If a property is located in SFHA, then the bank has to send them a

Answer 19

Notice that says

Your property is in a flood area

Your purchase requirements

Coverage is available

If relief is available in event of damage to property

Escrow clause

Question 20

How soon should notices be mailed if property is in a SFHA

Answer 20

Within a reasonable time before completion of the transaction

Question 21

How many applicants receive the notice if more than one

Answer 21

The bank can decide which applicant will receive the notice

Question 22

The bank must contain a record of what

Answer 22

That the borrower and the servicer received the notice

Question 23

If there is a servicer change what must the bank do

Answer 23

Notify FEMA, the insurance agent of the change within 60 days after the effective date of the change