Flood Zone Determinations

Flood Zone Determinations are required by lenders for most loans that collateralize real estate. The service is most often ordered and handled in large quantities by mortgage underwriters or loan processing centers. Effective March 1, 2011, all residential mortgages with federal backing will require a Flood Zone Determination. See the official order. The purpose is to determine whether or not flood insurance will be required on the collateralized structures on the property, usually a home or commercial/industrial building. Flood insurance requirements will vary greatly according to the flood zone, type of structure, and elevations. See more information at FloodSmart, the official site of the National Flood Insurance Program ("NFIP").

Example Flood Insurance Rate Map

The process of completing a Flood Zone Determination begins with a physical address of the property to be collateralized. This is usually a street address. The location is then plotted on the Flood Insurance Rate Map ("FIRM") for the area. The result of the Standard Flood Hazard Determination Form ("SFHDF") is based on whether the property plots to be in an area that has been mapped as a special flood hazard area. This process, when performed in mass quantities in many states, can occasionally produce errant results due to the available accuracy of mapping resources. We, however go to greater detail and efforts in properly determining flood zone status.

There is growing pressure to include more and more property owners into the National Flood Insurance Program to increase premium revenue due to growing losses. See this story for more information. New map update programs by FEMA have shifted and in some cases expanded mapped flood hazard areas. Many residential mortgages are subject to Flood Hazard Determinations during periodic review or when they are sold from one mortgage servicer to another. All of these factors result in more and more property owners being notified that they have now been determined to be in a special flood hazard area and must obtain flood insurance or dispute the requirement.

With over 20 years of experience in land surveying and mapping, we view and compare the official FEMA maps with available aerial photography that depicts the collateralized structure(s). This is so that we can make a more accurate assessment of the structure's flood zone status. A Flood Zone Determination ("SFHDF") which states that the structure is not in a special flood hazard area should remove the flood insurance requirement from the loan. The form itself states "if no, flood insurance is not required..." Should all or part of the structure actually be in a mapped special flood hazard area, we can also assist with the subsequent steps of an Elevation Certificate or Letter of Map Amendment ("LOMA").