Q&As
- What is the difference between a real estate agent and a real estate broker?
- What steps do I go through to buy a house?
- How long does it take to buy a house?
- I want to buy a house. I know the property and the seller has an agent. Do I need my own agent or can I negotiate a lower fee if I act as my own agent?
- How much does it cost to use a Buyer’s Agent / Realtor / Broker?
- Working with FHA/203B, RD, VA, Section 184, 203K, Conventional, HELOC, and other types of financing?
- Real vs Personal Property
- Mortgages for Manufactured Homes
- What is a CMA, Appraisal, and AVM?
- Can the Buyer purchase personal property from the Seller?
- Can a mortgage be used to purchase a mobile home?
- What are the basics for handling multiple offer negotiations?
- Are husband and wife required to apply jointly for a mortgage?
- How do I prepare for a cash purchase?
- Do I need flood insurance?
- Where can I research flood maps / areas?
- To whom should I write the earnest money check?
- Should I buy a residential service agreement (i.e. home warranty)?
- Assuming you’ll be obtaining mortgage financing (i.e. not paying cash), here’s a list of steps to buy a house:
- Do I also need an attorney?
- How does the MLS help buyers?
- What is the MLS?
- What’s the difference between a Pre-Qualification Letter and a Pre-Approval Letter?
- When do I apply with a mortgage lender?
- What is Owner’s Title Insurance (OTI)?
- What is Lender’s Title Insurance (LTI)?
- What is title insurance?
- What does a title company do for Buyers?
- How can Harrah Realty help me as a Buyer?
- How much does it cost to buy a home?
- Do you work with out of town clients?
- Can you help me purchase or build a new home?
- Do you work with First-Time Home Buyers?
- What is a lease purchase or an option purchase?
Do I need flood insurance?
Flood insurance is a separate policy from your homeowners hazard insurance policy.
Read more: What is a flood? What’s Covered?
If your property is in a high-risk flood zone and you obtain government-backed mortgage financing or obtain conventional financing from an FDIC-insured institution, you’ll be required to obtain flood insurance.
Read more: “When Flood Insurance is Required”
If you’re not required by your lender to obtain flood insurance, it may still be a good idea. Approximately 30% of flood claims (excluding the uninsured) happen on properties outside of high-risk map areas.
Lenders typically only check FEMA’s flood insurance requirements and not the municipality’s. This usually isn’t an issue unless the new owner wishes to take out a permit on the property, in which case the municipality’s rules come into play.
You may also find that you weren’t required to obtain flood insurance at the time of purchase, but your area’s flood maps were updated, in which case your lender may all of a sudden require it.
The Greene County floodplain maps are more strict than FEMA’s as part of the Community Rating System (CRS), which is why flood insurance premiums for properties in Greene County has some of the lowest flood insurance rates in the country (discounted 40% in some areas and 10% in others).
The Biggert-Waters Flood Insurance Reform Act of 2012 (BW-12) affected how FEMA and other agencies will be rating policies, with a move away from subsidies. Long-term, this is expected to result in higher — more accurately-priced — premiums (i.e. “full-risk rates”). As a result, a buyer cannot assume they’ll receive the same flood insurance rate that the previous owner was paying because it was likely a subsidized rate.
Update: BW-12’s implications were changed in March 2014 to more gradually phase in the full-risk rates instead of doing so more immediately (e.g. upon ownership transfer).
For the most recent updates, visit NAR’s NFIP information page.
To get a flood insurance rate quote and to learn more about flooding risks and insurance, you can visit the National Flood Insurance Program (NFIP) website, FloodSmart.gov.