A real estate agent is representing a buyer who is purchasing a waterfront home in Miami-Dade County. The property is located in a Special Flood Hazard Area (SFHA). The buyer is obtaining an FHA loan. What insurance requirement must the agent inform the buyer about?
Correct Answer
B) Flood insurance is required and must be purchased before closing
Flood insurance is mandatory for properties in Special Flood Hazard Areas when obtaining federally-backed loans like FHA loans, and it must be in place before closing. This is a federal requirement that applies throughout Florida. Option A (optional) is incorrect as it's mandatory for SFHA properties with federal loans. Option C (only windstorm required) is incorrect as flood insurance is specifically required for SFHA properties. Option D (seller provides) is incorrect as the buyer is responsible for obtaining required insurance.
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