During a recent training for a group of realtors, we had a solid discussion regarding the Letter of Map Amendment, also known as a LOMA. The LOMA, issued by FEMA, is an “official amendment, by letter” to a Flood Insurance Rate Map. This letter is provided to the property owner and the community and states that the structure in question is out of the 100-year floodplain and does not require the full risk flood insurance policy.
As I mentioned in a previous post, I have had a few instances of realtors calling me the day they are helping their client close on a property and ask for help with the flood insurance problem. Trying to get out of paying flood insurance can take a while, so let us learn how it is done.
It’s all about that structure
If you have checked the floodplain maps for your client and found no issue, stop reading this post and move on to something more important. However, if you check the maps and find your property surrounded by a sea of colors, it is probably in the floodplain. Sometimes, the property is on the edge of all the colors on the map and / or the colors split the property in half. The primary concern is the location of the structure. If the mapped 100-year floodplain is touching the structure, even a tiny corner, then there will be a requirement to purchase the full risk policy. This is where the Letter of Map Amendment can help save the day.
As with any government program…there is a form to be filled out. The highly descriptive “LOMA application form” must be filled out and submitted to FEMA by a licensed surveyor. The applicant must show:
- that the lowest ground touching the structure (also known as the Lowest Adjacent Grade, or LAG) is at or above the Base Flood Elevation;
- or the structure is completely out of the Special Flood Hazard Area.
Basically, the form is stating that an error has been made in the floodplain modeling and the structure is naturally higher in elevation than the floodplain.
The important part of this application is that it must be completed by a licensed surveyor; otherwise it will not be deemed acceptable. The surveyor will take a few elevation shots of the LAG and compare it to the Base Flood Elevation. If the LAG is higher, then you win! Finally, the surveyor will create an elevation certificate that describes their findings.
Now you wait…
Once the LOMA application form is submitted, a letter will be sent to the applicant notifying them of its acceptance. This process can take a bit of time, perhaps even a few months before you get notification from FEMA. This is because they are busy receiving floodplain related requests from many places.
In the community where the structure is located, the appropriate department (such as the Jeffersonville Building Commissioner’s office), receives a notice of the LOMA. Every so often, the City receives a notice from FEMA with all the new LOMA’s that have been added in our area.
The flood finale
If you plan to start the process as soon as possible, you can potentially save your client thousands of dollars through the acquisition of a LOMA. While this is not always possible, it is worth taking a few extra minutes to check into…you might make your client very happy!