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FEDERAL DEPOSIT INSURANCE CORPORATION 12 CFR CH. III (1,1,90 EDITION) PAGES 407-408 'AlT 339-LOANS .. AlIAS HAVING SPECIAL ROOO HAZARDS See. 331.1 Authorit~ and scope. 33t.3 DetlnltloDl. 339.3 Reclulrement to purc_ flood lDIur. &nee. 331." Ezemptton. 338.5 Recorda ot compJlance. 339.8 Notice ot spedaI fiood hazard and ot the ava1.labWty of Federal cli8uter relief auiltanee. A1l'rIIOarrY: Seal. lG3Cb) and :I02(b). Pub. 1.. 83-334. 81 Stat. 9'18. 883 .. _eel b~ ..... 104(&) and '703(&). Pub. 1.. 8&-138. 81 Slat. l1t5 (fa UB.e. 4013a(b). 4l08lb)); .... 1384. Pub. 1.. 83-383. 88 Stat. 138 (fa u.s.e. 41_). 80uacz 45 FR 58028. AIIll. 33. 1880. unl_ otherw1le noted. f 33t.1 AUlhority uti ........ Thls part Is lsaued under section 13M of the Houslnll and Community Development Act of 1974 lUld sectloM 102Cb) and 202Cbl of the l"Iood DI3as- ter Protection Act of 1973 aa amended by section 703 of the Housing and Community Development Act of 1977. Its provtslons apply to 10&IllI which are secured by Improved real estate or mobile homes and are made by Insured State nonmember banD or Insured State branches of foreign banD. 1339.% Definitions. cal The tenn "bank" means an In, sured State nonmember blUlk and an Insured State branch of a forelan blUlk. cb) The tenn "loan" means an exten. sion of credit secured by Improved real estate or a mobile home located or to be located In an area that has been Identified by the DIrector of the Fed, eral EmerllenCy Manallement Allency aa an area havinll special flood haz- ards. 1339.3 Requirement to purdtue flood in. 8uranee. No bank shall make. Increase. extend. or renew any loan aa defined . in I 339.2Cb) when the Improved real estate or mobile home securlnll the loan Is located or Is to be located In an area In which flood Insurance haa been made available under the Nation. , al Flood InsI1l'allCle Act of IH1, I um.. the bulldlnll or mobile hOUle and llIIY personal property sectI!'in& the louIla covered for the tenn of the loan by flood Insurance. The amount of the In- surance must be at least eQual to the outstandlnll prlnclpal ""'0""" of the loan or the maxlmum llmIt of coverqe made available for the part.IcuI&r type of property under the Act, w_ Is Iesa. f 33tA b..,uon. Flood Insuranee shall not be re- qulrecl on llIIY State-owned ~ that Is co.",cd under an ~ policy of self.1nsurance aatl8factor:r to the DIrector of the Pedenl - _ r Cy Management AllencY who wm pub- lish and perloclio>>lIy __ the lilt of States fal1lDll within the ..~ provided by this section. 1339,5 _0I_~ Eaeh bani< 8b&ll maintain for all ex. teD8lons of credit secured by Improved real estate or a mobile home sutfIcIeDi recorda to indicate the method used by the bani< to detel'llllne whether the ex. tellSlons of credit fall wltbIn the provI. slons of I 338.3 or I 339.4 of thIa part. f 331.1 Notice of .pedaI _ -... .... of the ..aI_llly 01 FedenI ~ relief _co, Ca) Notice ~irement. In .....lrh'.. lncreulnll. extendlnll, or renewing a loan aa defined In I 339.2<b), each bank shall mall or deUver a written notice to the borrower statiDc, Cl) That the property sectI!'in& the louI Ja or will be located In an area identified aa a flood hazard area Cor In Ueu of such notification. the bani< may obtain satisfactory written 8Bll1II'aIIce from the seller or lessor that the seller or lessor has notltled the borrower, before the execution of llIIY acreement for sale or lease. that the property se- curlnll the loan 18 or will be located In such an areal; and C2l whether Pederal disBBter reUef assJatance will be avail- able for the property If the property 18 dam&lled by a flood In a federally de- l Flood. 1naurance " availabJe to & COIDJIlUo- nity when the community is ~ In the NaUonal Flood InIIurance Procram. clared disaster. The notice must be mailed or deUvered aa soon aa feasible but not later thall 10 dayS before the closing of the transaction Cor not later thall the bank's commitment If any. If the period between commitment and closing Is less than 10 days). Each blUlk shall require the bonower. before closing. to provide the bank with a written aclmowledllll1ent that the borrower realIZes the property se, curing the loan Is or will be located In an area Identified as a flood hazard area and' that the borrower has re, celved the required notice rellardlnll Federal disaster relief assistance. Cbl Sample NotiCe& A bank provld, Ing written notice containing language subetanu.l1Y slmI1ar to that presented below. aa appropriate, within the time limits prescribed In paragraph Ca) of thla sectlon will be considered to be In compliance with the notice require. ments of paragraph Ca) of this section. (1) Notice to Borrowr 0/ Special FlOOf!. Hazard Area. Notice Is hereby given to CName of borrower) that the Improved real estate or mobile home described In the attached Instrument Is or will be located In an area designated by the Director of the Federal Emergency Manaaement Allency aa a special flood haZard area. This area Is delineated on cName of Community) Flood Insur. ance. Rate Map CFIRM) or. If the FIRM Is unavailable. on the Flood Hazard Boundary Map CFHBMl. The area haa .t least a 1 percent chance of being flooded within any liven year. The risk of exceedlnll the 1 percent chance Increaaes with time periods lonller than one year. For example, dll1'lnll the life of a 30,year mortplle, a structure located In a special flood haZard ......a has a 26 percent chalice of belnll flooded. C 2) NotICe to Borrowr about Federal Diltuter Relief A..ti8tance-l1l Notice in participating communities. The 1m. proved real estate or mobile home se- curIntl your loan Is or will be located In a community that Is now partiCipating In the National Flood Insurance Pro- llf&DL It the property Is damaIled by flOO<llnll In a federally declared dIsas, ter, Federal disaster reUef assistance may be available. However. such ..... slstance will be unavailable If your community haa been Identified aa a flood.prone area for one year or loncer and Is not partlclpatlnll In the Nation. al Flood Insurance Program when the assistance 18 approved. Thls 8B8l8tance. usually In the fonn of a loan with a fa- vorable Interest rate, may be available for damages Incuned In excess of your flood Insurance. ClI) NotICe in nonparticipating com. munities. The Improved real estate or mobile home securlnll your loan Is or will be located In a community that Is not partlclpatlng In the National Flood Insurance Program. Thls means that the property Is not eligible for Federal flood Insurance. It the proper. ty Is damalled by flOO<llnllIn a federal. Iy declared disaster. Federal disaster relief assistance for the property will be unavailable If your community has been Identified aa a flood.prone area for one yelU' or lonller. Such lI88istance may be available only If, at the time the assistance would be approved. your cOmlllunlty Is participating In the National Flood Insurance Program or haa been identified aa a flood,prone area for less than one year. -19.