Congress Takes a Break Without Extending the National Flood Insurance Program

Congress elected to take a break before passing critical legislation that may have a huge affect on housing, particularly those of us who live in Harris County. It is no big secret that flooding is a sensitive issue in Harris County. Folks who live in Houston know that you don’t have to live in a flood zone in order to experience a flood.

Congress left on Washington on March 26th after failing to agree on an unemployment benefits bill. This bill included a provision that would extend the National Flood Insurance Program. What one has to do with the other is anybody’s guess, but with Congress determining to leave without finishing the job, we are now left with a gap that may slow things down and will certainly inconvenience some taxpayers.

The federal insurance programs authority to write new policies ends on March 28th at midnight. No new policies will be written and renewals will not be issued. For potential homeowners looking to close on a home in a flood zone this is catastrophic. Part of a lender’s requirements to secure a loan on a home in a flood zone is that the purchaser maintains flood insurance on the home. No flood insurance means that these loans will not be approved. These transactions will be forced to extend or terminate through no fault of the buyer or seller.

Congress will reconvene on April 12th, and is expected to renew the national flood insurance program retroactively. A similar situation occurred in late February and the NFIP was closed for several days until Congress renewed it on March 2nd. This hiatus will last much longer, leaving many of us in the real estate industry in a holding pattern.

While a renewal is almost certain, it is a shame that Congress would allow such a lapse to occur in the first place. At a time when many are finally beginning to see light at the end of the tunnel it seems foolish to handcuff an industry that kept the economy afloat during its darkest hour. Taxpayers involved in the sale of a home located in a flood zone will most certainly find themselves inconvenienced over the next couple of weeks. Will some sales fail because of the inaction of Congress? I hope not, but it seems almost utopian to believe that not a single transaction will fail due to this delay. Shame on Congress for putting us in this predicament!


Stacy is a licensed REALTOR® and the team leader of The Jones Team, a group of REALTORS® in Katy, who work together to provide exceptional service for their clients. Stacy and his team specialize in the areas west of downtown Houston. These incredible real estate agents can help you buy or sell a home in locations such as Katy, Cypress, far West and Northwest Houston, Richmond, Fulshear, Sugar Land, Spring Branch, Memorial, Spring, Tomball, The Woodlands, and Magnolia. Whether you are in the market to sell a home, buy a home, have a question about home appraisal value, need advice about home staging ,or have any other real estate related questions, Stacy and The Jones Team are available to help.


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