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HUD/FHA - Get A Home Inspection - FAQ's

HUD/FHA - For Your Protection: Get a Home Inspection - FAQ's

  • 1. When is it mandatory to use the "For Your Protection: Get a Home Inspection" form?

The form is mandatory for loans on dwellings that are more than 12 months old, excluding refinance transactions and Home Equity Conversions Mortgages.

  • 2.  When HUD is the seller (HUD Real Estate Owned [REO]), will the "For Your Protection" form be required?

Yes.

Homebuyer Summary

  • 1.  When is the use of the Homebuyer Summary mandatory?

The Homebuyer Summary is mandatory for loans on all existing homes, except for 203(k) program loans and streamline financing.

  • 2.  Is the Homebuyer Summary required for existing properties (over one year old)?

Yes. The form is also required for existing properties less than one year old. The form is not required for proposed construction and properties under construction.

  • 3.  Should the Homebuyer Summary reflect only items needing repair, or should it also reflect certifications that may be required (termite inspections, well tests, septic certifications, etc.)?

The Homebuyer Summary should reflect ALL conditions noted on the VC sheet. If there are none, the appraiser should state this on the Homebuyer Summary.

  • 4. If there are no repairs or conditions, is the Homebuyer Summary still required?

Yes. If there are no repairs or conditions, the Homebuyer Summary should so state.

Valuation Conditions:

  • 1.  When is the use of the Valuation Conditions Form mandatory?

The Valuation Conditions (VC) Form is mandatory on all existing homes, except for 203(k) program loans and streamline refinancing without an appraisal.

  • 2.  We're concerned that a completed VC Form will be interpreted by some in the home purchase process as being equivalent to a Home Inspection. What measures are in place to ensure this will not happen? What role can the Lender play here?

The VC Form is for use by lenders and will not typically be issued to the borrower(s). Purchasers are provided with the Homebuyer Summary which specifically provides them with a summary of the observations of an appraiser who visited the property, plus reminds them that an appraisal is different from a home inspection. The Lender's role is to ensure that the borrower(s) understand the Homebuyer Summary and acknowledges receipt of the form. Also, Form HUD-92564-CN "For Your Protection: Get a Home Inspection" is presented to the borrower(s) and signed on or before the contract is executed.

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