Answers about Flood Insurance
Does the National Flood Insurance Act (Act) apply to loans that are being restructured or modified?
By definition, a “designated loan” is a loan secured by a building or mobile home that is located or to be located in a Special Flood Hazard Area (SFHA) in which flood insurance is available under the Act. If the loan being restructured or modified meets the definition of a designated loan, the Act would apply to that loan. Additional flood insurance may be required if the lender increases the amount of the loan.