[timob1973]

I understand that flood is required to be escrowed if a loan is made, increased, extended or renewed on or after 01-01-2016 (if no exemptions apply), however if a the property is later remapped into a flood zone are we required to escrow or simply provide the option to escrow the flood premiums? It seems that the making, increasing, extending or renewing is the actual trigger but trying to confirm.

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[rcooper]

timob1973 –
You are correct. The preamble to the final rule says this on page 35 (https://www.fdic.gov/news/board/2015/2015-06-16_notice_sum_c_fr.pdf):

Another financial institution commenter requested that the Agencies clarify that a flood map change on or after January 1, 2016 that causes a building, which had not previously been located in an SFHA, to be located in an SFHA would not impose a duty on a lender to begin escrowing flood insurance premiums and fees for a loan that is secured by such building. Section 102(d) of the FDPA, as amended, applies to loans that experience a triggering event on or after January 1, 2016. Because a map change is not a triggering event, lenders would not be required to escrow flood insurance premiums and fees based solely on that change.

[Author]

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