The League has updated the Notice of Special Flood Hazards form sold by the W.C.U.L. Services Corp. for use in certain real estate and mobile home-secured loans and credit sale transactions. A final proof version of the form may be viewed here:
Notice of Special Flood Hazards – WCUL #82010 (rev. 3/16) (8½ x 11 inch, one 2-sided sheet).
A description of the changes to the form is provided later in this Compliance Courier, along with a link to a copy with the changes highlighted. All state and federal credit unions should obtain and use the revised form at their earliest convenience as the text of the NCUA’s model form has changed.
When a credit union makes, increases, extends, or renews a loan secured by a building or a mobile home located or to be located in a special flood hazard area, the credit union must mail or deliver a written notice to the borrower and to the servicer in all cases, whether or not flood insurance is available under the Act for the collateral securing the loan.
How to obtain the fillable .pdf forms
A license to use this form may be purchased through The League’s website, www.theleague.coop > Products & Solutions > Credit Union Forms The purchased form may be downloaded immediately.
As previously announced, WCUL forms are sold only in fillable .pdf format. Preprinted paper forms and single-use forms are no longer offered. A license must be purchased and then you may print your own.
Revisions to the form
The hyperlink below goes to a proof copy of the revised Notice of Special Flood Hazards form with the changes highlighted. Yellow highlighting on the linked final proofs shows the locations of new or revised text; pink shows new or revised fields. There may be some additional changes not highlighted, including but not limited to deleted text or fields, change in number of characters in fields, etc.
#82010 – Pink and Yellow highlighted version.
The Notice of Special Flood Hazards – WCUL #82010 (rev. 3/16) form is updated to:
- Expand the title at the top of the form to Notice of Special Flood Hazards and Availability of Federal Disaster Relief Assistance;
- Expand the form to two sides, to be duplex-printed, with the signature lines moved to the back;
- Insert spaces for the name and address of the servicer of the loan (if other than the credit union), and the property address;
- Change the label in the caption from Applicant(s) to Borrower(s);
- Change the title of the Director of the Federal Emergency Management Agency (FEMA) to Administrator;
- Lengthen the space provided to identify the community so the NFIP community name can be included as well as the community number;
- Change the text to say This area has a one percent (1%) chance of a flood,… rather than …at least a one percent (1%) chance of a flood;
- Change the labels for the Participating Community and Non-Participating Community sections;
- Revise the language describing the limit on NFIP coverage;
- Add language regarding any structures on the property that are not subject to the mandatory flood insurance requirements;
- Revise the description of flood insurance coverage available under the NFIP;
- Add a new required paragraph regarding the availability of private flood insurance and advice about comparing it with the NFIP product;
- Add a new paragraph sometimes required, regarding the possibility that an escrow may be mandated for certain residential loans;
- Add a large blank field at the end of the text in case needed to provide some relevant additional information, to the extent permitted by law or perhaps required in the future;
- Add a signature line for the credit union official providing the notice and the date the notice is mailed or delivered;
- Provide name and signature lines for three borrowers rather than two applicants;
- Add a name, address, and signature lines for a servicer other than the credit union;
- Change the form from a two-copy set to a single copy. The credit union may specify the number of copies it desires when printing the form;
- Remove the Credit Union and Borrower copy labels. However, a small form field is provided in the bottom center of the form to insert such labels if desired; and
- Add a fillable field in the footer, which a credit union may use to record information as desired. If the form is not duplex printed, the next best thing may be to insert the borrowers’ names, the date, and the form title in this footer on each page.
Additional guidance
When a credit union makes, increases, extends, or renews a loan secured by a building or a mobile home in a special flood hazard area, the credit union must mail or deliver a written Notice of Special Flood Hazard and Availability of Federal Disaster Relief Assistance to the borrower. This applies in all cases, whether or not flood insurance is available. A notice must also be provided to the servicer of the loan; it may consist of a copy of the borrower’s notice. See ii Release No. B003 – Flood Insurance for details.
The Notice of Special Flood Hazards form is modeled after the sample in Appendix A of the NCUA flood insurance rule. A credit union will be considered to be in compliance with the flood insurance requirement for notice to the borrower under § 760.9 of the NCUA rule by providing written notices with the sample language within a reasonable time before the closing of the transaction.
The League summarizes the requirements of the NCUA flood insurance rule in ii Release No. B003.
Escrow Option Clause not included
This WCUL form does not include a new separate notice that is sometimes required. That notice informs the borrower of the option to escrow all premiums and fees for required flood insurance, and the method by which the borrower may request the escrow. Credit unions are exempt from the notice requirement at least until they have assets of $1 billion. Details of the requirement are provided in subsection (d) of 12 CFR § 760.5. Sample language for the notice is provided in 12 CFR § 760 Appendix B.
Use of WCUL fillable .pdf forms
Credit unions may use the fillable .pdfs on their desktops or have them mapped to their data processing systems. It is up to the credit union to forward their licensed .pdf files to the data processor, if they choose, for installation and mapping for use on the credit union’s system. Your data processor will not have the forms until you forward them! Credit unions may also share this Compliance Courier with their data processor if doing so will aid in mapping fields.
Laser forms should be printed and reviewed for proper display. Compare printouts of the installed forms to the final proofs available through the links above.
Please keep in mind that the license for WCUL forms permits use of the same .pdf files for manual completion on a desktop. This may be a valuable option during the time it may take for a data processor to map the fields when putting an updated form on the system.
Please address form order questions to Jeff Bonk at 800-242-0833, ext. 6044, and questions about completion of the form and compliance to John C. Engel at ext. 6007.
Important reminders
Please keep in mind that WCUL forms are designed for use in transactions subject to Wisconsin law and applicable federal law.
Please remember that the forms you use are important legal documents. Credit unions are responsible for reviewing forms to determine that they are appropriate for the transaction. Users should read and become familiar with the terms of each form they use and how they must be completed in compliance.