Article Score0

WE DID A REFIANCE ABOUT 13 MONTHS AGO. MY FIRST DOES NOT REQUIRE FLOOD INSURANCE, NOW MY SECOND HAS SAID THAT IT IS A REQUIREMENT. I HAVE THE PAPERWORK FROM BOTH THE FIRST AND SECOND THAT SHOWS THAT THERE WAS A FLOOD CIRTIFICATION DONE AT THE TIME. AND EVERTHING WAS OK FOR THE LIFE OF THE LOAN. ALSO ACCORDING TO THE FEMA WEB SITE AND ALSO MY INSURANCE COMPANY WE ARE NOT LOCATED IN A FLOOD ZONE. ZONE X IS WHERE THE PROPERTY IS LOCATED. I DO NOT HAVE A ELEVATION CIRTIFICATION ON THE PROPERTY, IF I WAS TO GET ONE IT WOULD COST ME ABOUT $ 700.00. NOBODY IN OUR AREA HAS FLOOD INSURANCE, AND THERE ARE OTHER PROPERTIES THAT SET LOWER THAN OURS. EVEN THOUGH MY INSURANCE COMPANY SAID I WAS NOT IN A FLOOD ZONE. THEY SAID I COULD PURCHASE A PREFERED FLOOD ZONE COVERAGE POLICY. THIS WOULD BE ABOUT $ 350.00 DOLLARS. I DON’T UNDERSTAND THE WHOLE CONCEPT. I HAVE ALREADY CONTACTED MY FIRST ABOUT ALSO DOING MY SECOND. I’M AT A LOSS AT THIS POINT, I JUST WANTED TO SEE IF ANYBODY HAD ANY IDEAS. THANK YOU.

6 Thoughts on What good does it do to pay for a flood cirtification at the time of a refinace??
  1. Reply
    Faye H
    August 19, 2011 at 1:43 am

    Your second lender came in 13 months after you took out the loan and said you need Flood coverage? Was that a requirement in the loan documents?

    They can require any type of insurance they want. However, their requirements should be in the loan documents, not a new requirement they decided to put in 13 months later. Look at your original loan documents and see what it says under insurance requirements. If it’s not in there, I don’t know how they can add that later.

    When I lived in a flood zone, it was in the loan that we would keep a flood policy in effect, along with coverage for fire, etc. We knew we had to have it when we took out the loan.

  2. Reply
    dan a
    August 19, 2011 at 2:04 am

    I would fax or email the findings from the FEMA web site and a letter from your insurance company to your 2nd mortgage lender to show the proof. I know that this is a step that you might have already taken, but figured I would mention in case you did not. I would also ask that lender how they came about remapping the flood zone area. Your last resort might be to get a consultation with a real estate attorney. It would be cheaper than being forced to pay the flood insurance every year.

  3. Reply
    kirsten h
    August 19, 2011 at 2:09 am

    i think its time to move that 2nd mtg to another lender. zone “X” is definately NOT a flood zone and therefore should not be required to have that policy.

  4. Reply
    bayou chick
    August 19, 2011 at 3:06 am

    Bless your heart…you must live in South Louisiana. Ever since Katrina, FEMA has decided to rezone everything where I live and the lenders are freaking out. I live in an X, and I each of the two times I financed the house, it wasn’t an issue. However, this does not sound kosher 13 months into the loan. Tell you what- go to RESPA.com. You will have contact #’s and samples of complaint forms that may steer you in the right direction. You may also want to contact the Attorney General in your state. Good luck. I hope this helps!

  5. Reply
    mbrcatz17
    August 19, 2011 at 4:02 am

    Well, flood zones CHANGE from year to year.

    The ONLY way to contest the true need for flood insurance is with an elevation certificate. $ 700 seems EXTREMELY high for one, here in Houston I was quoted $ 250, two years ago. But even if it is, you’ll be ahead of the game in less than two years if you get it done.

    It doesn’t surprise me that no one in your area has flood insurance – apparently it’s only been needed for people who have financed, or refinanced, in the past year.

    It is possible that the second mortgagee is WRONG. They could have the wrong house number, or the wrong STREET number, you CAN ask them to see a copy of the zone certificate they are using. After all, they CHARGED you for it in the closing.

    Besides that, all you can really do is just pay off that mortgage as fast as possible, so you don’t have all the hassles of having it forced on you, or having to fight them every year.

  6. Reply
    Wendy S
    August 19, 2011 at 4:47 am

    If you are in an “X” zone you are not in a SFHA (Special Flood Hazard Area) considered to be at minimal risk for a flood, and the mortgage company cannot require you to have flood insurance, period.

    Mortgage companies are required by the federal government to require you to carry Flood insurance if you are in a SFHA.
    What often happens, though, is that the lower level processors do not really understand the difference between a SFHA and a non-SFHA, and that non SFHA Homeowners are NOT required to carry the coverage.

    You need to go up the ladder at the mortgage company until you get someone with the knowledge and experience to really help you. Some mortgage companies have a separate department that handles Flood insurance – see if yours does. They’ll be much more likely to know the rules.

    Before I retired I often called on behalf of clients and spoke to a lot of uninformed people, but I never had to go higher than a supervisor before I spoke to someone who understood how things really worked – that you should not be required to purchase Flood insurance. You should not be required to submit an elevation certificate – their own records show you in a non-SFHA.

    I wish you had an insurance agent willing to go this extra mile for you. I always did it based on principle. No one screws over my clients on MY watch. 😉

    So, call again. If for some reason your Mortgage company will not let you get around the elevation certificate requirement (which would make me crazy), ask your insurance agent or call around to some surveyors. I had a company I referred all my clients to that would do the certificates for $ 50. $ 700 is the going rate for a full survey – something you do NOT need.

    All that said, remember that 40% of floods happen in non-SFHA areas. Having a flood insurance policy is not a bad thing – but you should not be required to have one.

    Leave a reply

    Register New Account
    Reset Password