Let’s talk about homes that require flood insurance. They aren’t very common in Colorado, but I’ve dealt with them, and they can bite you if you’re not careful.
What’s the big deal?
The biggest issue homeowners face is the cost. At 4% interest, a mortgage costs you $4.77 per month per $1000 borrowed. If you are considering buying a $250,000 home that requires a monthly flood insurance premium of $250, then you are paying the same amount monthly that you would for a $302,000 home that doesn’t require flood insurance… yikes! So homes that require flood insurance may not sell for as much because extra money will be needed to pay for that insurance every month, money that can’t go towards paying the mortgage. And as the great flood of 2013 showed, 100 year floods do happen!
Get Your Flood Map
So how do you know if your current home or the home you are thinking of buying is in a flood zone? The Federal Emergency Management Agency (FEMA) determines flood zones, and they have a decent online mapping service where you can search any address here: https://msc.fema.gov/portal. You enter the address on the first page and then the site is a little confusing as the first map just lets you select an area, you then have to hit the “Map Image -> View/Print” button to get the actual flood map. These maps are great to know which areas to avoid. Mortgage companies will also pull up flood certificates to determine if a property will require flood insurance as part of the loan approval process.