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Monday, March 24, 2014

Obama Signs Flood Insurance Affordability Bill

President Obama on Friday signed ABIA and ABA-backed flood insurance affordability legislation that previously cleared the House and Senate by large bipartisan majorities. The new law reinstates lower rates for grandfathered properties that were repealed under the 2012 Biggert-Waters law and extends the effective date for new escrow rules required under Biggert-Waters from July 6, 2014 to Jan. 1, 2016.

The law also clarifies that many loans would not be subject to mandatory escrow requirements, including those originated, refinanced, increased, extended or renewed before Jan. 1, 2016. The costs of the law are offset by a $25 annual fee on NFIP policy holders for primary residential properties and a $250 annual fee for policies on second homes and businesses.