Expensive flood insurance forces decisions: insurance or homelessness
BATON ROUGE - Many homeowners are patiently waiting on lawmakers to vote on the Flood Insurance Affordability Act. If the legislation does not pass, insurance rates for homeowners could skyrocket.
The new rules have caused home values to drop because of the uncertainty over rates and the fact that many people will be unable to afford the extra cost.
A new homeowner in Baton Rouge says he's facing a tough reality after learning his flood insurance rate will go up by 500 percent.
"[I'm] losing my house after I bought it a year ago," said John Parker.
A few months ago, Parker received a letter from his mortgage company about his increase in insurance. The home was added to new flood insurance maps in 2008. Parker says most of his neighborhood, including his home, has never flooded.
He sought two opinions from engineering companies; both came back with similar results and showed his current home elevation was about three feet below the base flood elevation, thanks to recent changes in the regulations.
Parker, along with others, could be facing challenges as soon as February if they are unable to pay the new rates.
The Flood Insurance Affordability Act would delay increasing cost of flood insurance, caused by the Biggert-Waters Act, allowing FEMA to complete a study determining affordable rates.