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The agency redrew flood map boundaries this summer across 100 communities in 12 states.

FEMA flood map revisions have moved thousands of properties into high-risk flood zones, triggering new flood insurance requirements for homeowners in affected communities.

The agency redrew flood map boundaries this summer across 100 communities in 12 states, according to Cotality. Thousands of properties now fall within a Special Flood Hazard Area, or SFHA. Homeowners affected by the changes must secure flood insurance within 45 days or potentially face disruptions.

An SFHA represents an area where a home has a 1% chance of flooding in any given year.

Insurance Costs Add to Escrow Payments

Properties that recently fell outside high-risk zones may now require flood insurance. Cotality said the coverage can add hundreds of dollars per month to a mortgage payment.

For 10% of homeowners, the amount paid into escrow for property taxes and hazard insurance already exceeds the principal and interest owed on the home.

FHA borrowers can face particular financial pressure from the changes. These borrowers typically have lower down payments, tighter debt-to-income ratios, and less capacity to absorb sudden increases in expenses.

When an FHA-financed property enters an SFHA, mandatory flood insurance premiums become part of the homeowner’s monthly mortgage payment through escrow.

Cotality also reported that escrow payments have increased 45% compared with five years ago. In states with revised flood maps, escrow costs now account for more than one-third of a mortgage payment.

Florida Leads NFIP Policies

Florida has nearly 1.8 million National Flood Insurance Program policies in force, the most among states included in Cotality’s data. Texas follows with 593,472 policies, while Louisiana has 412,131.

New Jersey has 196,511 policies, and South Carolina has 193,038.

The revised maps also moved substantial numbers of properties into and out of SFHAs. Escambia County, Florida, had 2,344 properties mapped into an SFHA, the highest figure listed. Pender County, North Carolina, followed with 678, while Chattanooga, Tennessee, had 635.

Meanwhile, 2,016 properties in Pembroke Pines, Florida, were mapped out of an SFHA. Another 1,309 properties in Escambia County were removed from the designation.

Flood Coverage and Mortgage Costs

Cotality reported that serious mortgage delinquencies, defined as payments at least 90 days late, are increasing for some borrowers in states with large numbers of NFIP policies.

In states where flood map panels underwent significant revisions, average escrow costs already represent a substantial share of monthly mortgage payments. Cotality reported shares of 30% in North Carolina, 36% in Missouri, and 41% in New York.

At the same time, reconstruction costs have increased 40% over five years, according to Cotality. Following Hurricane Helene, the company estimated uninsured flood losses of $20 billion to $30 billion.

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