[Code of Federal Regulations]

[Title 12, Volume 6]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR614.4935]



[Page 144]

 

                       TITLE 12--BANKS AND BANKING

 

                 CHAPTER VI--FARM CREDIT ADMINISTRATION

 

PART 614_LOAN POLICIES AND OPERATIONS--Table of Contents

 

                 Subpart S_Flood Insurance Requirements

 

Sec. 614.4935  Escrow requirement.



    If a System institution requires the escrow of taxes, insurance 

premiums, fees, or any other charges for a loan secured by residential 

improved real estate or a mobile home that is made, increased, extended 

or renewed on or after October 4, 1996, the institution shall also 

require the escrow of all premiums and fees for any flood insurance 

required under Sec. 614.4930. The institution, or a servicer acting on 

behalf of the institution, shall deposit the flood insurance premiums on 

behalf of the borrower in an escrow account. This escrow account will be 

subject to escrow requirements adopted pursuant to section 10 of the 

Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2609) (RESPA), 

which generally limits the amount that may be maintained in escrow 

accounts for certain types of loans and requires escrow account 

statements for those accounts, only if the loan is otherwise subject to 

RESPA. Following receipt of a notice from the Director of FEMA or other 

provider of flood insurance that premiums are due, the institution, or a 

servicer acting on behalf of the institution, shall pay the amount owed 

to the insurance provider from the escrow account by the date when such 

premiums are due.