The American Bankers Association today advised legislators to support legislation to reauthorize the National Flood Insurance Program through completion of next year. In a letter to House Financial Services Committee leaders, the association stated reauthorization continues to be a high top priority for banks since stability in the NFIP is vital to making sure that debtors in flood vulnerable locations can access the insurance coverage required to safeguard their homes and the security protecting their mortgage.
ABA likewise advised Congress to think about reauthorizing the NFIP on a longer-term basis. “The ongoing series of short-term extensions of program authority—and the potential for lapses in authority—destabilize the mortgage process,” the association stated. “As ABA has stated previously, there is a growing focus by banks and regulators to ensure that physical risks are adequately addressed. The availability of flood insurance, and particularly of the NFIP, is an essential element of those efforts and long-term reauthorization of the program is vital to a coordinated approach to ensuring resiliency of the housing finance system and to the continued ability of low-and moderate-income borrowers to access mortgage credit.”