Thanks a lot everybody for the information and opinions. Its definitely helpful.

I live about 2 blocks from there - the streets right near the train station also border a river. They flood pretty badly and more often than 100 years. If the property isn't in that immediate area and is on higher ground (like mine is) you'll probably be OK but stay away from those low-lying homes unless you want an indoor pool in your basement every major storm.

I live in New Milford. I would not let a family member purchase a home in that section of town.I saw the devastion and would not wish that on anyone.

The 100 yr flood zone was named that because flooding is not commonplace, but an occurrence that takes place about every 100 years. That's not to say that if it happens to you, you won't be miserable.
Some things to consider are how high off the water is the home you are considering? Is there a basement or crawl space to take on the water, or are you buying a slab? Water in your basement or crawl is not nearly as devestating as when it enters your living space.
Keep in mind that if you do purchase flood insurance that it does not cover personal items, just the mechanicals (furnace, hot water heater, etc.) Most plans only cost around $1000./year.
Finally, in real estate you get what you pay for. This home out of the risk of the flood zone will cost you more--so it's a trade off. My recommendation to you would be to talk to a local realtor. One who has lived in town and knows the history of the flood zone. It may not be much of an issue at all.

There are many homes in flood zones in a lot of towns. It is really a personal decision as to whether or not you buy in a flood zone. There are a lot of homes that fit your price range without a flood zone. Please contact me through my website and I can email you listings that fit your needs.
I look forward to hearing from you.
Sharon Kozinn

Flood insurance is intended to compensate home owners from financal loss due to flooding. However it does not compensate you from the inconvenience that often exceeds the financial loss. Most of the rivers flowing through Bergen county are prone to flood. The Hackensack and Saddle rivers would be the ones that would impact you if you afre looking in the general area and in that price range,
I would suggest widening your search somewhat and you should be able to fine something in you price range and still keep within easy commuting. Fairlawn is one that springs to mind.