Flood Insurance On Smith Lake – Who Needs It?
Let’s talk about the new flood insurance rules and how they will affect Smith Lake buyer’s who utilize a lender to finance their purchase. Much of Smith Lake shoreline now lies within a flood zone classification. What does this mean to the property owner who has, or will have, his Smith Lake home on the market? The cost of flood insurance will vary according to the structure’s elevation, flood plain classification and assessed valuation. For many property owners, making a small investment now can mean the difference between a buyer paying a hefty annual flood insurance premium, or receiving a LOMA (Letter of Mapping Adjustment) exemption.
You might ask who mandates flood insurance. Answer — THE LENDER. With the recent map update, much of Smith Lake shoreline is now classified as Flood Zone A. Most Flood Zone A improved property being sold today utilizing a lending source is now required to secure flood insurance through the NFIP (National Flood Insurance Program). All lenders are held responsible for making this determination.
Many people are unaware that a large number of Smith Lake improved properties can be exempted from this mandated flood insurance coverage. Taking the time to file for a LOMA now can eliminate time consuming delays at closing time.
Filing for a LOMA is fairly straight forward. The property owner should secure the services of a qualified surveyor who will make the elevation measurements and fill out the required LOMA paperwork. Once FEMA has received the paperwork, a determination should be forthcoming within thirty to sixty days. What’s the cost—a lot less than paying one year’s flood insurance premium.
What happens if you don’t have a LOMA exemption (flood certification certificate) for your property and the closing on the sale of your Smith Lake property is but a few days out? If your buyer is paying cash, don’t sweat it, if on the other hand a loan is involved, somebody will probably be buying flood insurance. Buyers don’t like surprises (hidden costs) and will most likely look to the seller for some form of remuneration. As buyers become cognizant of LOMA exemptions, properties already exempted will be on the short list for consideration. One way to make your property stand out in today’s market — get a LOMA!
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