12 CFR 761 (Cross Reference 1007)

National Credit Union Administration

§ 761.1

exclusions, conditions, and premiums associated with flood insurance policies issued on
behalf of the NFIP and policies issued on behalf of private insurance companies and contact an insurance agent as to the availability, cost, and comparisons of flood insurance coverage.
[Escrow Requirement for Residential Loans
Federal law may require a lender or its
servicer to escrow all premiums and fees for
flood insurance that covers any residential
building or mobile home securing a loan that
is located in an area with special flood hazards. If your lender notifies you that an escrow account is required for your loan, then
you must pay your flood insurance premiums
and fees to the lender or its servicer with the
same frequency as you make loan payments
for the duration of your loan. These premiums and fees will be deposited in the escrow account, which will be used to pay the
flood insurance provider.]
llFlood insurance coverage under the
NFIP is not available for the property securing the loan because the community in
which the property is located does not participate in the NFIP. In addition, if the nonparticipating community has been identified
for at least one year as containing a special
flood hazard area, properties located in the
community will not be eligible for Federal
disaster relief assistance in the event of a
Federally declared flood disaster.
[80 FR 43262, July 21, 2015]

APPENDIX B TO PART 760—SAMPLE
CLAUSE FOR OPTION TO ESCROW FOR
OUTSTANDING LOANS
Escrow Option Clause

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You have the option to escrow all premiums and fees for the payment on your
flood insurance policy that covers any residential building or mobile home that is lo-

cated in an area with special flood hazards
and that secures your loan. If you choose
this option:
• Your payments will be deposited in an escrow account to be paid to the flood insurance provider.
• The escrow amount for flood insurance
will be added to the regular mortgage payment that you make to your lender or its
servicer.
• The payments you make into the escrow
account will accumulate over time and the
funds will be used to pay your flood insurance policy when your lender or servicer receives a notice from your flood insurance
provider that the flood insurance premium is
due.
To choose this option, follow the instructions below. If you have any questions about
the option, contact [Insert Name of Lender
or Servicer] at [Insert Contact Information].
[Insert Instructions for Selecting to Escrow]
[80 FR 43263, July 21, 2015]

PART 761—REGISTRATION OF RESIDENTIAL
MORTGAGE
LOAN
ORIGINATORS
AUTHORITY: 12 U.S.C. 1751 et seq. and 5101 et
seq.
SOURCE: 78 FR 32545, May 31, 2013, unless
otherwise noted.

§ 761.1 Cross reference.
The rules formerly at 12 CFR part 761
have been republished by the Consumer
Financial Protection Bureau at 12 CFR
part 1007, ‘‘S.A.F.E. Mortgage Licensing Act—Federal Registration of Residential Mortgage Loan Originators
(Regulation G)’’.

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