Required by Federal Law, lenders are responsible for ensuring that all properties in their loan portfolio are protected against damage or loss caused by floods. If a property is deemed to be in a flood zone, a lender may Force-Place Flood Insurance on the home. This will typically happen if the borrower does not have enough flood insurance to meet the legal minimum required to protect the home in the event of a flood.

Lenders and borrowers may order a Flood Zone Determination to see if a home is within a flood zone area. Flood Zone Determinations provide lenders and their borrowers with a Standard Flood Hazard Determination Form (SFHDF) and the flood zone information necessary to determine whether flood insurance is required. Each Flood Zone Determination is based on the current FEMA Flood Insurance Rate Map (FIRM), as required by federal regulations.