House we are under contract to buy is in a high-risk flood zone
I sure didn't see that coming. We entered into contract this past Monday and when we went to apply for the mortgage and were signing all the paperwork for the mortgage application, one of the papers indicated that the house was in a flood zone. I didn't think too much of it at first, figuring maybe they put a whole package of papers into a mortgage application, but it kept bothering me so I looked up the address in the federal government flood zone website. It was quite a shock to see it come back saying it was a high-risk flood zone property. The house is not near any water that I'm aware of (although I know sometimes that doesn't matter) so it just was not something I even thought about.
However, I'm sort of wondering why the seller or his agent did not disclose that information. I guess it's possible they did not know? The seller has only owned the house for a little over a year -- it was a foreclosure that he bought and rehabbed.
I called one of the insurance agencies listed on the government website to get an idea of how much a flood insurance policy would be, and the agent told me that it is possible just part of the land is in the zone and not the actual house. Apparently that is common. If that's the case, the premium will be pretty cheap. If not, its going to be expensive.
If the house is in the high-risk zone, that's a deal breaker for me. Absolute deal breaker, as much as it pains me. What I'm not sure about is whether it should be a deal breaker if just part of the land is in the zone. I feel like that is a definite possibility because the house is situated up about 10 feet higher than street level.
I really am so surprised that this is not a required disclosure. I don't know that technically I would be able to use that to get out of the contract but it's sort of immaterial because we haven't had the inspection done yet and I have until today to get the earnest money to the agent, so it's not a big concern at this point.
I really don't know much at all about high-risk flood zones except not to buy a house in one. But as I read a little about it yesterday, I discovered that many times it's just the property, or a part of the property, and not the house that is high risk. Figures there would be something like that thrown into the mix to muddy the waters (heh).