A buyer who borrows to buy a house in a federal flood zone receives a written notice. One federal sample notice reads: “This area has a one percent (1%) chance of a flood equal to or exceeding the base flood elevation (a 100-year flood) in any given year. During the life of a 30-year mortgage loan, the risk of a 100-year flood in a special flood hazard area is 26 percent (26%).”
The notice also says: “Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance.”