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How It Works
How It Works
Before a person can receive a loan or other financial assistance from one of the affected agencies or lenders, there must be a check to see if the building is in a special flood hazard area. A special flood hazard area is the base (100-year) floodplain mapped on a flood insurance rate map (FIRM). It is shown as one or more zones that begin with the letter A or V.

Town's Flood Zones
The FEMA Flood Zones Map may also be viewed at the Department of Public Works, located at 127 Center Street South. Many lenders and insurance agents have copies, also. It is the agency's or the lender's responsibility to check the FIRM to determine if the building is in a special flood hazard area, although many communities provide assistance.

If the building is in a special flood hazard area, the Federal government requires the property owner or land owner to purchase a flood insurance policy on the building. The requirement is for structural coverage equal to the amount of the loan (or other financial assistance) or the maximum amount available, whichever is less. The maximum amount available for a single-family house is $250,000.

Items not Affected
The mandatory purchase requirement does not affect loans or financial assistance for items that are not covered by a flood insurance policy, such as vehicles, business expenses, landscaping and vacant lots. It does not affect loans for buildings that are not in the special flood hazard area, even though a portion of the lot may be flood prone. While not mandated by law, a lender may require a flood insurance policy for a property in any zone on a flood insurance rate map.

Additional Details
For more information about flood insurance and flood maps, please visit the FEMA website.