Can I back out of this deal ?

[Luis Rodriguez]

I'll try to make a long story short here. We're in contract for a duplex in Queens, NY. My broker told us the house wouldn't need flood insurance before we made an offer. We're in the final steps before setting a closing date. We found out our mortgage was approved today and one of the conditions said that we needed flood insurance. I was already worried about the money we were spending and now this is getting to be too much. We were only able to put 5% down so the PMI is pretty high. Add on the $2776 a year for flood insurance. It feels like we're throwing a lot of money out the window. Now, no one ever told us we needed flood insurance. I did a little research online and I read about how the sellers have to disclose that the house is in a flood zone. Is that the case in NYC ? The house is in zone AE.