FHA FAQ

Use the FAQ section of your site to answer those routine questions that always come up and need to be answered. This is a great way to tell us more about what you can offer, fill in some details that might intrigue us, and show us how knowledgeable and helpful you can be.

The Appraiser must visually observe all areas of the crawl space and notify the Mortgagee of the deficiency of Minimum Property Requirements (MPR) and Minimum Property Standards (MPS) when the crawl space does not satisfy any of the following criteria:

• The floor joists must be sufficiently above ground level to provide access for maintaining and repairing ductwork and plumbing.

• If the crawl space contains any system components, the minimum required vertical clearance is 18 inches between grade and the bottom of the floor joists.

• The crawl space must be properly vented unless the area is mechanically conditioned.

• The crawl space must be free of trash, debris, and vermin.

• The crawl space must not be excessively damp and must not have any water pooling.

• If moisture problems are evident, a vapor barrier and/or prevention of water infiltration must be required. 

If there is evidence of a deficient condition, the Appraiser must report this condition and render the appraisal subject to inspection and repairs, if necessary.
 
In cases where access through a scuttle is limited, and the Appraiser cannot fully enter the crawl space, For additional information see Handbook 4000.1 II.D.3.l the insertion of at least the head and shoulders of the Appraiser will suffice. 

If there is no access to the crawl space but there is evidence of a deficient condition (such as water-stained subflooring or smell of mold), the Appraiser must report this condition and the Mortgagee must have a qualified third party perform an inspection.  If there is no access, the Appraiser must report the lack of accessibility to the area in the appraisal report.
 
There is no requirement to cut open walls, ceilings or floors. Not all houses (especially historic houses) with a vacant area beneath the flooring are considered to have a crawl space; it may be an intentional void, with no mechanical systems and no intention or reason for access. 

The Appraiser must observe the interiors of all attic spaces.   The Appraiser is not required to disturb insulation, move personal items, furniture, equipment or debris that obstructs access or visibility. If unable to view the area safely in their entirety, the Appraiser must contact the Mortgagee and reschedule a time when a complete visual observation can be performed, or complete the appraisal subject to inspection by a qualified third party.

In cases where access through a scuttle is limited and the Appraiser cannot fully enter the attic, the insertion of at least the head and shoulders of the Appraiser will suffice.   If there is evidence of a deficient condition (such as a water-stained ceiling, insufficient ventilation, or smell of mold), the Appraiser must report this condition, and render the appraisal subject to inspection and repairs if necessary.  

If there is no access or scuttle, the Appraiser must report the lack of accessibility to the area in the appraisal report. There is no requirement to cut open walls, ceilings or floors. 

An observation performed in accordance with these guidelines is visual and is not technically exhaustive. 

For additional information see Handbook 4000.1 II.D.3.j 

The appraiser must obtain a copy of the lease from the Mortgagee and must analyze and report the terms of the ground lease, including:

• the amount of the Ground Rent, 

• the term of the lease, 

• if the lease is renewable, 

• if the lessee has the right of redemption (the right to obtain a Fee Simple title by paying the value of the Leased Fee to the lessor, thereby cancelling the ground rent), and 

• if the Ground Rent can increase or decrease over the life of the lease term. 

In valuing the Leasehold Interest, the Appraiser must apply the appropriate techniques to each of the approaches to value included in the analysis.

• In the cost approach, the value of the land reported must be its Leasehold Interest.

• In the Gross Rent Multiplier (GRM) income approach, the sales used to derive the GRM factor must be based on properties under similar Ground Rent terms (or be adjusted to similar Ground Rent terms).

• In the sales comparison analysis, the comparable sales must be adjusted for their lack of similarity to the subject in the “Ownership Rights” section of the Sales Comparison Approach (SCA) grid. 

For additional information see Handbook 4000.1 II.D.7.c at

After Improved Value refers to the value as determined by the Appraiser based on a hypothetical condition that the repairs or alterations have been completed. 

The Appraiser must make the appraisal “subject to the following repairs or alterations on the basis of a hypothetical condition that the repairs or alterations have been completed.”  The Appraiser must review the 203(k) consultant’s work write-up or the contractor’s proposal and cost estimates. The Appraiser must notify the Mortgagee of any health and safety issues in the property that are not addressed in the work write-up or proposal.  When the consultant or contractor has modified the work write-up or proposal, the Appraiser must complete the appraisal based on the final work write-up or the contractor’s final proposal and cost estimates. 

The Appraiser must include the work write-up or proposal as an exhibit to the appraisal report. 

For additional information see Handbook 4000.1 II.D.12.c.ii  at

The Mortgagee must confirm that any Overhead Electric Power Transmission Lines do not pass directly over any dwelling, structure or related property improvement, including pools. The power line must be relocated for a property to be eligible for FHA-insured financing.  

The residential service drop line may not pass directly over any pool, spa or water feature.   If the dwelling or related property improvements are located within the Easement area, the Mortgagee must obtain a certification from the appropriate utility company or local regulatory agency stating that the relationship between the improvements and Local Distribution Lines conforms to local standards and is safe. 

For additional information see Handbook 4000.1 II.A.3.a.ii(B) 

If the dwelling or related improvements were built on or after 1978, the Appraiser must report all defective paint surfaces on the exterior and require repair of any defective paint that exposes the subsurface to the elements.

If the dwelling or related improvements were built before 1978, the Appraiser must note the condition and location of all defective paint and require repair in compliance with 24 CFR 200.810(c) and any applicable Environmental Protection Agency (EPA) requirements. The Appraiser must observe all interior and exterior surfaces, including common areas, stairs, deck, porch, railings, windows and doors, for defective paint (cracking, scaling, chipping, peeling, or loose). Exterior surfaces include those surfaces on fences, detached garages, storage sheds, and other outbuildings and appurtenant Structures.

For Condominium Units built before 1978, the Appraiser must observe the interior of the unit, common unit and exterior surfaces and appurtenant Structures of the specific unit being appraised; and address the overall condition, maintenance and appearance of the Condominium Project. The Appraiser must note the condition and location of all defective paint in the unit, common area and exterior, and require repair in compliance with 24 CFR 200.810(c) and any applicable EPA requirements.

For additional information see:

• Handbook 4000.1 II.D.3.i and II.D.3.m.i. 

• Federal Register 24CFR, 200.810

The Appraiser must state the remaining economic life as a single number or as a range for all property types, including condominiums. The Appraiser must provide an explanation if the remaining economic life is less than 30 years.  The Appraiser must apply the appropriate technique to estimate the economic life of the subject and not just report a number without analysis.  The Mortgagee must confirm that the term of the mortgage is less than or equal to the remaining economic life of the property. 

For additional information see Handbook 4000.1 II.D.4.c.iii(D) and II.A.3.a.ii(I)

Leasehold refers to the right to hold or use Property for a fixed period of time at a given price, without transfer of ownership, on the basis of a lease contract. Leasehold Interest refers to real estate where the residential improvements are located on land that is subject to long-term lease from the underlying fee owner, creating a divided estate in the Property.

Forward Mortgage Requirements:
A Mortgage secured by real estate under Leasehold requires a renewable lease with a term of not less than 99 years, or a lease that will extend not less than 10 years beyond the maturity date of the Mortgage.

HECM Requirements:
A reverse mortgage, or Home Equity Conversion Mortgage (HECM), secured by real estate under Leasehold requires a renewable lease for not less than 99 years, or a lease having a remaining period of not less than 50 years beyond the date of the 100th birthday of the youngest mortgagor. Sub-Leasehold Estates are not eligible for FHA mortgage insurance.

An Appraiser must contact the Mortgagee if the Leasehold Interest does not meet this requirement.

For additional information see Handbook 4000.1 II.D.3.b.i(B)(1) and II.D.3.b.i(D) at

Non-Standard House Style refers to unique Properties in the market area, including log houses, earth sheltered housing, dome houses, houses with lower-than-normal ceiling heights, and other houses that in the Appraiser’s professional opinion, are unique. 

The Appraiser must provide a comment that the Non-Standard House Style appears structurally sound and readily marketable and must apply appropriate techniques for analysis and evaluation. In order for such a property to be fully marketable, the Appraiser must demonstrate that it is located in an area of other similar types of construction and blend in with the landscape.  The Appraiser may require additional education, experience, or assistance for these types of properties. 

For additional information see Handbook 4000.1 II.D.3.b.vii(C) 

The Appraiser must limit required repairs to those repairs necessary to:

• maintain the safety, security and soundness of the Property;

• preserve the continued marketability of the Property; and

• protect the health and safety of the occupants.

The Appraiser may complete an as-is appraisal for existing Properties when minor property deficiencies, which generally result from deferred maintenance and normal wear and tear, do not affect the health and safety of the occupants or the security and soundness of the Property. Cosmetic or minor repairs are not required, but the Appraiser must report and consider them in the overall condition when rating and valuing the Property. Cosmetic repairs include missing handrails that do not pose a threat to safety, holes in window screens, cracked window glass, defective interior paint surfaces in housing constructed after 1978, minor plumbing leaks that do not cause damage (such as a dripping faucet), and other inoperable or damaged components that in the Appraiser’s professional judgment do not pose a health and safety issue to the occupants of the house.

If an element is functioning well but has not reached the end of its useful life, the Appraiser should not recommend replacement because of age.

The nature and degree of any noted deficiency will determine whether the Appraiser must address the deficiency in the narrative comments area of the report under “condition of the property” or “physical deficiencies” affecting livability or structural soundness.

The Appraiser must limit required repairs to those repairs necessary to:

• maintain the safety, security and soundness of the Property.

• preserve the continued marketability of the Property; and

• protect the health and safety of the occupants.

The Appraiser must notify the Mortgagee and make the appraisal subject to an inspection by a qualified individual or Entity when the observation reveals evidence of a potential safety, soundness, or security issue beyond the Appraiser’s ability to assess.

The Appraiser must report and describe the indication of a particular problem when requiring an inspection of any mechanical system, structural system, or other component requiring a repair.

The Mortgagee must evaluate the appraisal in accordance with the requirements for Defective Conditions. When defective conditions exist and correction is not feasible, the Mortgagee must reject the Property. The Mortgagee may only approve a Property after the Mortgagee confirms that all defects reported by the Appraiser have been corrected. If the property was made subject to inspection and either the inspection found no issues or the inspection found issues that were mitigated and approved by the inspector, then and only then can the mortgagee / lender approve the property.

For more information see Handbook 4000.1 II.A.3.a, II.A.3.a.ii(M), II.A.3.a.i and II.D.3.n at

The effective date of the appraisal cannot be before the FHA case number assignment date unless the Mortgagee certifies, via the certification field in the Appraisal Logging Screen in FHA Connection, that the appraisal was ordered for conventional lending or government guaranteed loan purposes. The Mortgagee must retain documentation in the case binder substantiating conversion of the mortgage to FHA.
 
The Mortgagee must ensure that the appraisal was performed

• by an FHA Roster Appraiser; and 

• in accordance with FHA appraisal reporting requirements as detailed in Handbook 4000.1 and the Appraisal Report and Data Delivery Guide.

The appraisal must be in full compliance with the Uniform Standards of Professional Appraisal Practice (USPAP), which requires that this be classified as a new assignment. The intended use of the appraisal must indicate that it is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage.  Additionally, FHA and the Mortgagee must be indicated as the intended users of the appraisal report.
 
If the Appraiser determines that the scope of work is met with regard to Minimum Property Requirements, Minimum Property Standards, and USPAP compliance, and further determines that a re-inspection of the Property is not necessary, the effective date of the appraisal may be the date of the original inspection. However, if an FHA-compliant inspection is required, the date of the inspection will become the effective date of the new appraisal.

For FHA policy information see Handbook 4000.1 II.A.1.a.iii(B)(7) and II.D.1.a at

In cases where a Borrower has switched Mortgagees, the first Mortgagee must, at the Borrower’s request, transfer the appraisal to the second Mortgagee within five business days. The Appraiser is not required to provide the appraisal to the new Mortgagee.

The client name on the appraisal does not need to reflect the new Mortgagee.

If the original Mortgagee has not been reimbursed for the cost of the appraisal, the Mortgagee is not required to transfer the appraisal until it is reimbursed.  

The second Mortgagee may not request the Appraiser to re-address the appraisal. If the second Mortgagee finds deficiencies in the appraisal, the Mortgagee must order a new appraisal. 

For additional information see Handbook 4000.1 II.A.1.a.iii(B)(8) 

In cases where a Borrower has switched Mortgagees, the first Mortgagee must, at the Borrower’s request, transfer the appraisal to the second Mortgagee within five business days. The Appraiser is not required to provide the appraisal to the new Mortgagee.

The client name on the appraisal does not need to reflect the new Mortgagee.

If the original Mortgagee has not been reimbursed for the cost of the appraisal, the Mortgagee is not required to transfer the appraisal until it is reimbursed.  

The second Mortgagee may not request the Appraiser to re-address the appraisal. If the second Mortgagee finds deficiencies in the appraisal, the Mortgagee must order a new appraisal. 

For additional information see Handbook 4000.1 II.A.1.a.iii(B)(8) 

The Appraiser must not include the value of leased mechanical systems and components in the Market Value of the subject Property. This includes furnaces, water heaters, fuel or propane storage tanks, solar or wind systems (including power purchase agreements), and other mechanical systems and components that are not owned by the property owner. The Appraiser must identify such systems in the appraisal report. 

For additional information see Handbook 4000.1 II.D.3.b.vii(G) available at 

The Appraiser must notify the Mortgagee if mechanical systems do not appear:

• to have reasonable future utility, durability and economy.

• to be safe to operate.

• to be protected from destructive elements; nor

• to have adequate capacity.

The Appraiser must observe the physical condition of the plumbing, heating and electrical systems. The Appraiser must operate the applicable systems and observe their performance.

If the systems appear to be damaged or do not appear to function properly, the Appraiser must condition the appraisal for repair or further inspection.

If the Property is vacant, the Appraiser must note in the report whether the utilities were on or off at the time of the appraisal.

If the utilities are off at the time of inspection, the Appraiser must ask to have them turned on and complete all requirements under Mechanical Component (Handbook 4000.1 II.D.3.f). However, if it is not feasible to have the utilities turned on, then the appraisal must be completed without the utilities turned on or the mechanical systems functioning.

If the utilities are not on at the time of observation and the systems could not be operated, the Appraiser must:

• render the appraisal as subject to re-observation;

• condition the appraisal upon further observation to determine if the systems are in proper working order once the utilities are restored; and

• complete the appraisal under the extraordinary assumption that utilities and mechanical systems, and appliances are in working order.

The Appraiser must note that the re-observation may result in additional repair requirements once all the utilities are on and fully functional.

If systems could not be operated due to weather conditions, the Appraiser must clearly note this in the report.

The Appraiser should not operate the systems if doing so may damage equipment or when outside temperatures will not allow the system to operate.  Electrical, plumbing, or heating/cooling certifications may be required when the Appraiser cannot determine if one or all of these systems are working properly.

If the subject of the appraisal assignment for a new FHA-insured mortgage is a HUD Real Estate Owned (REO) Property, the requirements for the Appraiser are the same as for any other Property.

If the utilities are turned off at the time of inspection, the Appraiser must ask to have them turned on and complete all requirements under Mechanical Components in Handbook 4000.1, Section II.D.3.f.  However, if it is not feasible to have the utilities turned on, then the appraisal must be completed without the utilities turned on or the mechanical systems functioning.

If the utilities are not on at the time of observation and the systems could not be operated, the Appraiser must:

• render the appraisal as subject to re-observation.

• condition the appraisal upon further observation to determine if the systems are in proper working order once the utilities are restored; and

• complete the appraisal under the extraordinary assumption that utilities and mechanical systems, and appliances are in working order.

The Appraiser must note that the re-observation may result in additional repair requirements once all the utilities are on and fully functional.

For more information, see Handbook 4000.1 II.D.3.f and II.D.12.e.iii(B)

An Onsite Sewage Disposal System refers to wastewater systems designed to treat and dispose of effluent on the same Property that produces the wastewater. The Appraiser must:

• note the deficiency of Minimum Property Requirements (MPR) or Minimum Property Standards (MPS) and notify the Mortgagee if the Property is not served by an off-site sewer system and any living unit is not provided with an Onsite Sewage Disposal System adequate to dispose of all domestic wastes in a manner that will not create a nuisance, or in any way endanger the public health.
• visually observe the Onsite Sewage Disposal System and its surrounding area.
• require an inspection to ensure that the system is in proper working order if there are readily observable signs of system failure.
• report on the availability of public sewer to the site.
• note the deficiency of MPR or MPS and notify the Mortgagee if there is evidence that the Onsite Sewage Disposal System is not sufficient.
  

The Mortgagee must confirm that a connection is made to a public or community sewage disposal system whenever feasible and available at a reasonable cost. If connection costs to the public or community system are not reasonable, the existing Onsite Sewage Disposal Systems are acceptable provided they are functioning properly and meet the requirements of the local health department.

When the Onsite Sewage Disposal System is not sufficient and an off-site system is available, the Mortgagee must confirm connection to an off-site sewage system. When the Onsite Sewage Disposal System is not sufficient and an off-site system is not available, the Mortgagee must reject the Property unless the Onsite Sewage Disposal System is repaired or replaced and complies with local health department standards.

The Appraiser must examine the foundation for readily observable evidence of safety or structural deficiencies that may require repair. If a deficiency is noted, the Appraiser must describe the nature of the deficiency and report necessary repairs, alterations or required inspections in the appraisal where physical deficiencies or adverse conditions are reported. 

For Manufactured Housing, the appraisal must be conditioned upon the certification of an engineer or architect that the foundation is in compliance with the Permanent Foundations Guide for Manufactured Housing (PFGMH) available at https://www.hud.gov/program_offices/administration/hudclips/guidebooks/4930.3G   

Basement:  The Appraiser must notify the Mortgagee of the deficiency of Minimum Property Requirements (MPR) or Minimum Property Standards (MPS) if the basement is not free of dampness, wetness, or obvious structural problems that might affect the health and safety of occupants or the soundness of the Structure. 

The Mortgagee must confirm that all foundations will be serviceable for the life of the mortgage and adequate to withstand all normal loads imposed. 

Note: Finished basements are not included in the total gross living area. 

The Office of Single-Family Housing’s implementation of the Department's Lead Safe Housing program will include the provision of full lead-based paint inspections (rather than only paint testing) of all HUD Real Estate Owned (REO) properties constructed before 1978 that are sold with FHA-insured financing. If the inspection identifies the presence of deteriorated lead-based paint, properties sold with FHA insurance will be subject to lead-based paint stabilization of such paint and clearance testing. HUD will only order a lead-based paint evaluation for HUD REO properties constructed before 1978 and purchased with FHA-insured financing.

In cases where a borrower has switched Mortgagees, the first Mortgagee must, at the borrower’s request, transfer the appraisal to the second Mortgagee within five business days. The appraiser is not required to provide the appraisal to the new Mortgagee. The client’s name on the appraisal does not need to reflect the new Mortgagee. 

If the original Mortgagee has not been reimbursed for the cost of the appraisal, the Mortgagee is not required to transfer the appraisal until it is reimbursed.  The second Mortgagee may not request the appraiser to re-address the appraisal. If the second Mortgagee finds deficiencies in the appraisal, the Mortgagee must order a new appraisal.  

The new Mortgagee must enter the borrower’s information in FHA Connection. The new Mortgagee must collect an appraisal fee from the borrower, and send the fee to the original Mortgagee, who, in turn, must refund the fee to the original borrower. 

A second appraisal may only be ordered by the second Mortgagee under the following limited circumstances:
•    the first appraisal contains material deficiencies as determined by the underwriter for the second Mortgagee;
•    the Appraiser performing the first appraisal is prohibited from performing appraisals for the second Mortgagee; or
•    the first Mortgagee fails to provide a copy of the appraisal to the second  Mortgagee in a timely manner, and the failure would cause a delay in closing and harm to the Borrower, including loss of interest rate lock, violation of purchase contract deadline, occurrence of foreclosure proceedings and imposition of late fees. 

For additional information see Handbook 4000.1 II.A.1.a.iii(B)(8) and (9)

No. Your state appraisal regulatory office must send an update to the National Registry in order for your status to be changed in the FHA appraiser roster. The Appraisal Subcommittee (ASC) does not independently make changes to individual records in the National Registry.

The Mortgagee must order a new appraisal for each mortgage or refinance case number assignment and may not reuse an appraisal that was performed under another case number, even if the prior appraisal is not yet more than 120 days old. 

The FHA appraisal validity period is 120 days. 

The 120 day validity period for an appraisal may be extended for 30 days at the option of the mortgagee if:

(1) the mortgagee approved the borrower or HUD issued the Firm Commitment before the expiration of the original appraisal; or 
(2) the borrower signed a valid sales contract prior to the expiration date of the appraisal. 

An appraisal update must be performed before the initial appraisal, with no extension, has expired.  Where the initial appraisal is subsequently updated, the updated appraisal is valid for a period of 240 days after the effective date of the initial appraisal report that is being updated. 

For additional information see Handbook 4000.1 II.A.1.a.i(A)(1)(b) available at

The following guidance may be used immediately for existing cases and must be used for FHA case numbers assigned on or after January 4, 2021.
 
The Mortgagee must provide the Appraiser with a fully executed form HUD-92541 Builder’s Certification of Plans, Specifications and Site, signed and dated no more than 30 Days prior to the date the appraisal was ordered, and

• For Properties 90 percent completed or less, the Mortgagee must provide a copy of the floor plan, plot plan, and any other exhibits necessary to allow the Appraiser to determine the size and level of finish of the home they are appraising.

• For Properties greater that 90 percent but less than 100 percent complete, the Mortgagee must provide the Appraiser with a list of components to be installed or completed after the date of inspection.

When New Construction is less than 90 percent complete at the time of the appraisal, the Appraiser must document the floor plan, plot plan, and exhibits necessary to determine the size and level of finish.

When New Construction is 90 percent or more complete, the Appraiser must document a list of components to be installed or completed after the date of appraisal.

FHA does not require a survey of the property. However, the lender may require a survey and the borrower can be charged for a property survey.

If the Mortgagee notified the Appraiser or the Appraiser has evidence that a Property is contaminated by the presence of methamphetamine (meth), either by its manufacture or by consumption, the Appraiser must render the appraisal subject to the Property being certified safe for habitation.

A Property identified as contaminated by the presence of methamphetamine (meth), either by the manufacture or consumption, is ineligible due to this environmental hazard until the Property is certified safe for habitation.

If the effective date of the appraisal is prior to certification that the Property (site and dwelling) is safe for habitation, the Appraiser will complete the appraisal subject to certification that the Property is safe for habitation.

If the effective date of the appraisal is after certification that the Property (site and dwelling) is safe for habitation, and the Mortgagee has provided a copy of the certification by the certified hygienist, the Appraiser must include a copy of the certification in the appraisal report.

The Appraiser must analyze and report any long-term stigma caused by the Property’s contamination by meth and the impact on value or marketability.

For additional information see Handbook 4000.1 II.A.3.a.ii(L) and II.D.3.m.ii 

The Mortgagee must provide the appraiser with a fully executed form HUD-92541, Builder's Certification of Plans, Specifications, and Site, signed and dated no more than 30 days prior to the date the appraisal was ordered.  

A manufactured home must have been constructed on or after June 15, 1976, in conformance with the federal Manufactured Home Construction and Safety Standards (MHCSS), as evidenced by an affixed HUD Certification Label or a letter of label verification issued on behalf of HUD. Manufactured Homes produced prior to this date are ineligible for FHA-insured financing.

Manufactured Housing refers to structures that are transportable in one or more sections.  Manufactured Housing may also be referred to as mobile housing, sectionals, multi-sectionals, double-wide, triple-wide or single-wide.

To be eligible for FHA mortgage insurance as a Single Family Title II Mortgage, all Manufactured Housing must comply with the following: 

• have a floor area of not less than 400 sq. feet;  

• be constructed on or after June 15, 1976, in compliance with the Federal Manufactured Home Construction and Safety Standards as evidenced by the affixed HUD Certification Label;

• the Manufactured Home and site exist together as a real estate entity in accordance with state law (but need not be treated as real estate for purposes of state taxation); 

• be built and remain on a permanent chassis; 

• be designed to be used as a dwelling with a permanent foundation built in accordance with the Permanent Foundations Guide for Manufactured Housing (PFGMH); 

• have been directly transported from the manufacturer or the dealership to the site; 

• the finished grade elevation beneath the Manufactured Home or, if a basement is used, the grade beneath the basement floor is at or above the 100-year return frequency flood elevation; and

• be designed for occupancy as a Principal Residence by single family or a lease that meets Valuation of Leasehold Interests requirements.  

For additional information see Handbook 4000.1 II.A.1.b.iv(B)(7) and II.D.5.a. and b.

Manufactured units may be moved only from the manufacturer's or dealer's lot to the site on which the unit will be insured. The manufactured unit must not have been installed or occupied previously at any other site or location.   

If the Appraiser observes additions or structural changes to the original manufactured home, the Appraiser must condition the appraisal upon inspection by the state or local jurisdiction administrative agency that inspects manufactured housing for compliance, or a licensed structural engineer may report on the structural integrity of the manufactured dwelling and the addition if the state does not employ inspectors. 

Data Plate refers to a paper document located on the interior of the property that contains specific information about the unit and its manufacturer.  Manufactured homes have a data plate affixed in a permanent manner, typically adjacent to the electric service panel, the utility room or within a cabinet in the kitchen.   

The Mortgagee may obtain a copy of the foundation certification from a previous FHA-insured Mortgage, showing that the foundation met the guidelines published in the Permanent Foundations Guide for Manufactured Housing (PFGMH) that were in effect at the time of certification, provided there are no alterations and/or observable damage to the foundation since the original certification. 

The Appraiser must include a sufficient number of sales to produce a credible value. The Appraiser must include at least two Manufactured Homes in the Sales Comparison Approach (SCA) Grid, except when the subject Manufactured Home has been certified based on the construction requirements of Fannie Mae's MH Advantage® or Freddie Mac's CHOICEHome® program — if that certification criteria is met, the appraiser must include at least two comparable sales with similar certification, when available.

The Appraiser must include a sufficient number of sales to produce a credible value. At least two of the comparable sales properties must be Manufactured Homes in the Sales Comparison Approach (SCA) Grid, except for Fannie Mae's MH Advantage® or Freddie Mac's CHOICEHome® certified homes, for which appraisers must include at least two comparable sales with similar certification, when available. 

The towing hitch and Running Gear must be removed.  Running Gear refers to a mechanical system designed to allow the manufactured housing unit to be towed over public roads. 

The permanent foundation of a Manufactured Home that is eligible for FHA mortgage insurance is built in accordance with the Permanent Foundations Guide for Manufactured Housing (PFGMH).   

Skirting refers to a non-structural enclosure of a foundation crawl space intended to ensure the crawl space is free from exposure to the elements and free from vermin, trash, and debris. Typically, but not always, it is a lightweight material such as vinyl or metal attached to the side of the Structure, extending to the ground (generally, not installed below frost depth).

Stationary storage tanks that contain flammable or explosive material pose potential hazard to housing, including hazards from fire and explosions.

When an Individual Water Supply System is present, the Appraiser must report on the availability of connection to a public and/or Community Water System and any jurisdictional conditions requiring connection.  When the Appraiser obtains evidence that any of the water quality requirements are not met, the Appraiser must notify the Mortgagee and provide an estimated cost to cure.

The Mortgagee must confirm that a connection is made to a public or Community Water System whenever feasible and available at a reasonable cost. If connection costs to the public or community system are not reasonable, the existing onsite systems are acceptable, provided they are functioning properly and meet the requirements of the local health department.

When an Individual Water Supply System is present, the Mortgagee must ensure that the water quality meets the requirements of the health authority with jurisdiction. If there are no local (or state) water quality standards, then water quality must meet the standards set by the Environmental Protection Agency (EPA), as presented in the National Primary Drinking Water regulations in 40 CFR §§ 141 and 142.

Use the FAQ section of your site to answer those routine questions that always come up and need to be answered. This is a great way to tell us more about what you can offer, fill in some details that might intrigue us, and show us how knowledgeable and helpful you can be.

A well water test is required for, but not limited to, Properties:

The following guidance may be used immediately for existing cases and must be used for FHA case numbers assigned on or after January 4, 2021.

The Appraiser must notify the Mortgagee of the deficiency of Minimum Property Requirements (MPR) or Minimum Property Standards (MPS) if the roof covering does not prevent entrance of moisture or provide reasonable future utility, durability and economy of maintenance and does not have a remaining physical life of at least two years. 

The appraiser must analyze and report if close proximity to heavily traveled roadways or railways has an effect on the marketability and value of a site because of excess noise and safety issues. 

The Uniformed Standards Professional Appraiser Practice (USPAP), requires appraisers to analyze all prior sales of the subject property within the past three (3) years for all types of real property (including one-to-four family), if such information is available in the normal course of business.     Except under limited circumstances, a re-sale within 90 days of the last sale is not eligible for an FHA-insured Mortgage.  The temporary waiver of FHA's regulation that prohibits the use of FHA financing to purchase single family properties that are being resold within 90 days of the previous acquisition, expired on December 31, 2014.

Property Flipping is indicative of a practice whereby recently acquired property is resold for a considerable profit with an artificially inflated value.

No.  Property flipping is a practice whereby a recently acquired property is resold, often for a considerable profit.  If there is a partial continuity of ownership, a quit claim deed transaction is not a sale and is not subject to the rules prohibiting property flipping. The use of a quit claim will not be deemed a flip as long as at least one of the original owners retains an ownership interest in the property after the quitclaim is recorded.

The eligibility of a Property for a Mortgage insured by FHA is determined by the time that has elapsed between the date the seller has acquired title to the Property and the resale date.

Defective Conditions