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U.S. Code as of:
01/19/04
Section 4104a. Notice requirements
(a) Notification of special flood hazards
(1) Regulated lending institutions
Each Federal entity for lending regulation (after consultation
and coordination with the Financial Institutions Examination
Council) shall by regulation require regulated lending
institutions, as a condition of making, increasing, extending, or
renewing any loan secured by improved real estate or a mobile
home that the regulated lending institution determines is located
or is to be located in an area that has been identified by the
Director under this chapter or the Flood Disaster Protection Act
of 1973 as an area having special flood hazards, to notify the
purchaser or lessee (or obtain satisfactory assurances that the
seller or lessor has notified the purchaser or lessee) and the
servicer of the loan of such special flood hazards, in writing, a
reasonable period in advance of the signing of the purchase
agreement, lease, or other documents involved in the transaction.
The regulations shall also require that the regulated lending
institution retain a record of the receipt of the notices by the
purchaser or lessee and the servicer.
(2) Federal agency lenders
Each Federal agency lender shall by regulation require
notification in the manner provided under paragraph (1) with
respect to any loan that is made by the Federal agency lender and
secured by improved real estate or a mobile home located or to be
located in an area that has been identified by the Director under
this chapter or the Flood Disaster Protection Act of 1973 as an
area having special flood hazards. Any regulations issued under
this paragraph shall be consistent with and substantially
identical to the regulations issued under paragraph (1).
(3) Contents of notice
Written notification required under this subsection shall
include -
(A) a warning, in a form to be established by the Director,
stating that the building on the improved real estate securing
the loan is located, or the mobile home securing the loan is or
is to be located, in an area having special flood hazards;
(B) a description of the flood insurance purchase
requirements under section 102(b) of the Flood Disaster
Protection Act of 1973 [42 U.S.C. 4012a(b)];
(C) a statement that flood insurance coverage may be
purchased under the national flood insurance program and is
also available from private insurers; and
(D) any other information that the Director considers
necessary to carry out the purposes of the national flood
insurance program.
(b) Notification of change of servicer
(1) Lending institutions
Each Federal entity for lending regulation (after consultation
and coordination with the Financial Institutions Examination
Council) shall by regulation require regulated lending
institutions, in connection with the making, increasing,
extending, renewing, selling, or transferring any loan described
in subsection (a)(1) of this section, to notify the Director (or
the designee of the Director) in writing during the term of the
loan of the servicer of the loan. Such institutions shall also
notify the Director (or such designee) of any change in the
servicer of the loan, not later than 60 days after the effective
date of such change. The regulations under this subsection shall
provide that upon any change in the servicing of a loan, the duty
to provide notification under this subsection shall transfer to
the transferee servicer of the loan.
(2) Federal agency lenders
Each Federal agency lender shall by regulation provide for
notification in the manner provided under paragraph (1) with
respect to any loan described in subsection (a)(1) of this
section that is made by the Federal agency lender. Any
regulations issued under this paragraph shall be consistent with
and substantially identical to the regulations issued under
paragraph (1) of this subsection.
(c) Notification of expiration of insurance
The Director (or the designee of the Director) shall, not less
than 45 days before the expiration of any contract for flood
insurance under this chapter, issue notice of such expiration by
first class mail to the owner of the property covered by the
contract, the servicer of any loan secured by the property covered
by the contract, and (if known to the Director) the owner of the
loan.
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