Mortgage Industry Standards Maintenance Organization (MISMO), the real estate finance industry’s standards group, is initiating an endeavor to standardize flood risks disclosure.
The effort stems from MISMO’s Environmental, Social & Governance (ESG) Community to develop a process providing consumers access to information and resources aiding property flood risk insight.
“MISMO is committed to facilitating the development and adoption of standards to support the exchange of ESG information, and this new flood risk initiative addresses an ‘environmental’ aspect of ESG and the industry’s need for standardized data in this space,” MISMO President Seth Appleton said. “This new group is focused on helping the real estate finance industry efficiently meet the needs of homebuyers by developing standardized flood risk resources. MISMO is the perfect place for this collaboration, which will necessarily include lenders, servicers, vendors, GSEs, government agencies, regulators, and others.”
According to MISMO, there is no standardized information available to help consumers understand a property’s flood risk or how that risk may change over time.
The initiative will include targeting resources MISMO can provide the industry to make standardized flood risk information more widely available to consumers, such as a white paper or resource document providing information on the specific risks taken on or the flood history of the property.
Additionally, officials are seeking to establish a roadmap resulting in the creation of a standard disclosure an agency or company can adopt to provide to consumers during the loan closing process.