Flood Zone Disclosure
Definition
Flood zone disclosure requires informing buyers whether a property is located in a designated flood zone as mapped by FEMA. Properties in high-risk flood zones may require mandatory flood insurance.
Example
A property is located in FEMA Zone AE, a high-risk flood area. The buyer's lender requires flood insurance as a condition of the mortgage. Annual flood insurance premiums are $1,200 in addition to the homeowner's insurance policy. The seller must disclose the flood zone designation.
Exam Tip
Standard homeowners insurance does NOT cover floods—separate flood insurance is required. Flood insurance is MANDATORY in Special Flood Hazard Areas (SFHAs) for federally backed loans. FEMA maps determine flood zones. Remember that flood zone status can affect property value and insurance costs significantly.
Related Disclosures Terms
Protected Classes
Protected classes are groups of people who are legally shielded from discrimination based on specific characteristics.
Lead-Based Paint Disclosure
The Lead-Based Paint Disclosure is a federally mandated disclosure required for all residential properties built before 1978. Sellers and landlords must disclose known lead-based paint hazards and provide the EPA pamphlet "Protect Your Family From Lead in Your Home."
Property Condition Disclosure
A property condition disclosure is a written statement by the seller detailing the known condition of the property, including defects, repairs, and issues with major systems. Most states require sellers to complete this form.
Seller's Disclosure Statement
A seller's disclosure statement is a form that sellers complete to inform buyers about the condition and history of the property, including known defects, past repairs, insurance claims, and environmental issues.
Megan's Law Disclosure
Megan's Law requires states to make information about registered sex offenders available to the public. Some states require real estate agents to inform buyers about the availability of sex offender registries.
Radon Disclosure
Radon disclosure involves informing buyers about the presence or potential presence of radon gas in a property. Radon is a naturally occurring radioactive gas that can accumulate in buildings and is the second leading cause of lung cancer.
Frequently Asked Questions
Test Your Disclosures Knowledge
Practice with exam-style questions to make sure you can apply Flood Zone Disclosure and other disclosures concepts.