Consumer complaint received 2024-08-30
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: JPMORGAN CHASE & CO. (MA)

I was contacted by Chase Bank by letter that they had determined that my condominium address is in a flood zone, and therefore, I must buy flood insurance to protect their interest in the condo unit. Oddly, they also wrote that FEMA determined my home was in a flood zone.

If I did not purchase flood insurance for them, they would do so for me and pass the costs on to me by raising my mortgage. They then wrote that if I believe I'm not in a flood zone, to contact FEMA and to request an amendment or revision to the flood map ( XXXX or XXXX ) and that I would have to pay for any costs associated with getting them to revise the map and send proof. I went to the FEMA website, entered my address and it showed that I was NOT in a flood zone as of XX/XX/year>. So I'm not sure what they are supposed to revise or amend. 

I called Chase to get more information and the person I spoke to reiterated that FEMA made this determination. I point her to the FEMA website and she said she was not sure how to read the map. She asked me to contact FEMA and to go through the XXXX process. 

I called FEMA and the person I spoke to said ( 1 ) that FEMA does not communicate with banks about flood map updates, and ( 2 ) Chase bank has a third party they contract with that makes the " Standard Flood Hazard Determinations '' ... or something like that. This XXXX representative then went to their maps and confirmed that my home is not in a flood zone. I asked XXXX what to do and they recommended doing both of the following actions : ( 1 ) Go through the XXXX process but that it takes 60 days ; ( 2 ) File a complaint with the regulatory body over the organization that Chase contracts with to make the determinations, and to contact the state attorney general. FEMA gave me a number to call. 

I called that number, went through a long menu of option, spoke to someone who then told me that it does sound like Chase is engaged in forced-insurance. She then said the best entity to help me through this is the Consumer Finance Protection Bureau.

I decided to contact Chase one more time. I explained the situation, and relayed to them what FEMA said and that FEMA denies communicating with them directly ( contradicting what the previous Chase representative said ). This new Chase rep admits that it was another entity that makes that determination, and reiterated the only remedy available to me is to fill out the XXXX forms at my expense. She also reiterated that if I don't buy a flood insurance policy for Chase, they would do it for me, and pass the costs to me, even though it'll take 2 months before FEMA can send proof that I'm not in a flood zone. She mentioned something about offering a refund if they were wrong, but that seems to contradict aspects of what is written in the letter, particularly where there's a gap in coverage.

In short, as best as I understand it, Chase contracts with some 3rd Party to make determinations about whether a property is in a flood zone, then Chase claims that it was FEMA who made that determination, then demands homeowners to buy flood insurance to protect Chase 's interest in the property. If the homeowner doesn't comply, Chase will buy what they openly admit may not be the most affordable insurance. To comply with their demand, they give homeowners LESS than the 60 days it takes to go through the XXXX process ( which you may have to pay for ) to prove you are not in the flood zone, even though ANYONE can simply go to the FEMA website, enter their address, and see that they are not in a flood zone. 

I did a quick XXXX search and it seems Chase has a history of doing this. 

This is not at all fair.