Is Flood Insurance Escrowed?

Beginning Jan. 1, 2016, if you have flood insurance, you may also have the option to escrow your flood insurance premiums. The change comes as a result of a final rule implementing the Homeowner Flood Insurance Affordability Act of 2014.

Why is flood insurance escrowed?

The escrow provisions are designed to improve compliance with flood insurance requirements by ensuring that borrowers with designated loans secured by residential improved real estate or a mobile home set aside funds to maintain flood insurance for the life of the loan.

Does FNMA require flood insurance to be escrowed?

Fannie Mae does not require an escrow deposit for property or flood insurance premiums for an individual unit in a condo, co-op, or PUD when the project in which the unit is located is covered by a blanket insurance policy purchased by the homeowners' association or co-op corporation.