Recordkeeping and Disclosure Requirements Associated with Loans Secured by Real Estate Located in Flood Hazard Areas Pursuant to Section 208.25 of Regulation H
ICR 201906-7100-004
OMB: 7100-0280
Federal Form Document
⚠️ Notice: This information collection may be outdated. More recent filings for OMB 7100-0280 can be found here:
Recordkeeping and Disclosure
Requirements Associated with Loans Secured by Real Estate Located
in Flood Hazard Areas Pursuant to Section 208.25 of Regulation
H
In general, the federal flood
insurance statutes and Regulation H - Membership of State Banking
Institutions in the Federal Reserve System (12 CFR 208) provide
that a lender shall not make, increase, extend, or renew a loan
secured by a building or mobile home located in a special flood
hazard area unless the secured property is covered by flood
insurance for the term of the loan. With respect to the
recordkeeping and disclosure provisions, the regulation requires
state member banks to: • retain a completed copy of the Standard
Flood Hazard Determination Form developed by the Federal Emergency
Management Agency (standard FEMA form). The form is used by lenders
to document their determination of whether improved property
securing a loan is in a special flood hazard area, • notify a
borrower and servicer when loans secured by improved property are
determined to be in a special flood hazard area and retain a record
of receipt of the notice, • notify a borrower of a loan secured by
residential improved property or a mobile home that the state
member bank is required to escrow all premiums and fees for
required flood insurance when the bank makes, increases, extends,
or renews the loan. For loans secured by residential improved
property or a mobile home that were outstanding on January 1, 2016,
or July 1 of the first year in which the bank loses its exception
from the escrow requirement, the state member bank must mail or
deliver information on the option to escrow flood premiums and
fees, • notify a borrower of the borrower’s obligation to obtain
flood insurance if the lender determines at any time during the
term of the loan that the improved property securing the loan is
not covered by adequate flood insurance. If the borrower fails to
obtain the flood insurance within 45 days of this notification, the
state member bank or its servicer must purchase insurance and may
charge the borrower for the cost of the premiums. If the state
member bank receives confirmation of a borrower’s existing flood
insurance coverage after it has force placed insurance on behalf of
the borrower, the bank or its servicer shall notify the insurance
provider to terminate any insurance purchased by the bank or its
servicer, and • notify the Federal Emergency Management Agency
(FEMA) of the identity of, and any change in, the servicer of a
loan secured by improved property in a special flood hazard area.
The information collection requirements under the flood hazard
provisions of Regulation H are triggered by specific events in the
lending process.
US Code:
42
USC 4012a Name of Law: Flood Disaster Protection Act of
1973
US Code: 42
USC 4104a Name of Law: National Flood Insurance Act of 1968
US Code: 12
USC 321 Name of Law: Federal Reserve Act
US Code: 12
USC 248(i) Name of Law: Federal Reserve Act
PL: Pub.L. 112 - 141 126 Name of Law:
Biggert-Waters Flood Insurance Reform Act of 2012
The Office of the Comptroller
of the Currency (OCC), the Board, the Federal Deposit Insurance
Corporation (FDIC), the Farm Credit Administration (FCA), and the
National Credit Union Administration (NCUA) (collectively, the
agencies) have amended their regulations regarding loans in areas
having special flood hazards to implement the private flood
insurance provisions of the Biggert-Waters Flood Insurance Reform
Act of 2012 (Biggert-Waters Act). Specifically, the final rule
requires regulated lending institutions to accept policies that
meet the statutory definition of “private flood insurance” in the
Biggert-Waters Act and permits regulated lending institutions to
exercise their discretion to accept flood insurance policies issued
by private insurers and plans providing flood coverage issued by
mutual aid societies that do not meet the statutory definition of
“private flood insurance,” subject to certain restrictions. The FR
H 2 has been revised to add new recordkeeping requirements for the
private flood insurance. The final rule is effective on July 1,
2019.
On behalf of this Federal agency, I certify that
the collection of information encompassed by this request complies
with 5 CFR 1320.9 and the related provisions of 5 CFR
1320.8(b)(3).
The following is a summary of the topics, regarding
the proposed collection of information, that the certification
covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a
benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control
number;
If you are unable to certify compliance with any of
these provisions, identify the item by leaving the box unchecked
and explain the reason in the Supporting Statement.
FRH2_20190618_omb.pdf
Recordkeeping Sections 208.25(c)(3)(iii) and (iv) Private flood insurance