What is a Coastal Barrier Resource Area (CBRA)? Does the flood insurance purchase requirement apply to loans secured by properties located in a CBRA?
A Coastal Barrier Resource Area (CBRA) is a geographic area designated by Congress that is protected from development because of its rich biological habitats and geologic features. Since the passage of the Coastal Barrier Resources Act of 1982, federal funds in the form of a loan, insurance payment, subsidy, grant, or guarantee are prohibited except for certain emergency situations. No federally backed loans can be made for the purpose of constructing or purchasing improved property in a CBRA. Federal flood insurance is not available on properties that were built, or substantially improved, after the area was designated as a CBRA. Even though conventional loans can be made to purchase improved property in these areas, lending institutions should be aware that such loans would not be protected by flood insurance. As for the mandatory purchase of flood insurance requirements, lending institutions are required to determine if the buildings on these properties are within the Special Flood
Related Questions
- What is a Coastal Barrier Resource Area (CBRA)? Does the flood insurance purchase requirement apply to loans secured by properties located in a CBRA?
- Can I purchase flood insurance through the National Flood Insurance Program (NFIP) if my home is not in a special flood hazard area?
- Why is there a requirement to purchase flood insurance in communities that have not suffered flooding in many years or ever?
