Consumer Compliance Outlook Spotlights Lender-Placed Flood Insurance

The most recent issue of the Federal Reserve publication Consumer Compliance Outlook features an article on lender-placed flood insurance. The article provides guidance on FEMA’s change in the waiting period requirements for lender force-placed insurance using the Mortgage Portfolio Protection Program (MPPP). It also addresses Section 100244(a)(1) of the Biggert-Waters Act, which “permits lenders to purchase force-placed insurance beginning on the date that a lender determines a property lacks coverage or the amount of coverage is insufficient, and it permits lenders to pass the cost of that force-placed insurance along to the borrower, including any associated fees.”