Imagine opening your mail one day and learning that your home is suddenly in a flood zone, and that you'll have to pay hundreds of dollars more each year for insurance.
Farfetched? Nope. It's happening to more and more homeowners, even some who live high up on hills, because of confusion over new FEMA flood maps. Don't assume you are immune.
Surprise Letter in the Mail
Chris and Kate Horwarth love how their home sits high on a bluff about 40 feet above a small creek.
That little creek was never an issue, until they recently received a surprising letter from their mortgage lender.
Kate said "we got a letter from Bank of America, saying our house was in a flood zone, "A star." And we would have to purchase flood insurance for our home."
Worse, they say Bank of America then went ahead and started deducting flood insurance directly out of their bank account. Kate told me "we got another letter from the bank saying they had provided flood insurance for $2,000 a year for us!"
But We're Not in a Flood Zone
But the Horwarths insist their home is not in a flood zone. I asked them "has the water ever come near the house?" Chris told me "no, it has never come anywhere near the house."
They even obtained a document from their insurer, State Farm, stating that their "structure is not in a flood plain." And they obtained another from the county saying the house is "well above base flood elevation."
Happening to Many Other Homeowners
But the Horwarths are not alone, and it's not just Bank of America. News reports from around the country describe many other homeowners suddenly forced to buy flood insurance.
Why? It turns out FEMA redrew and flood maps after Hurricane Katrina, extending possible flood plains, and if your home sits in an area that could be hit by a 100 year flood, you may now be forced to buy flood insurance, depending on your insurer.
So I called Bank of America, and a spokeswoman for the lender promised me they would re- investigate the Horwarth's claim.
Shortly after my call, the bank told me it has decided to drop their flood insurance requirement, and refund any money they were charged.
Thats great news for the Horwarths, whose dreamy view could have cost them hundreds of dollars they couldn't afford.
Don't Let this Happen to You
My advice? If your lender suddenly tells you that you need flood insurance, don't just accept it.
Consult with FEMA ( CLICK HERE for their latest flood maps), your insurer, and your county, and if you find you're not in a flood plain, gather your documents and fight back.
So don't waste your money.
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