The National Flood Insurance Act of 1967 and the Flood Disaster Protection Act of 1973 (FDPA), as amended, govern the National Flood Insurance Program (NFIP). Among other things, these statutes require the purchase of flood insurance on certain properties and make available federally subsidized flood insurance to owners and improved real estate or mobile homes located in special flood hazard areas if the community where the improved real estate or mobile home is located participates in the NFIP.

The Mandatory Purchase Requirement states that the national bank or federal savings association shall not make, increase, extend or renew any designated loan unless the building or mobile home any personal property securing the loan is covered by flood insurance for the term of the loan.

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