On December 15, 2022, the Federal Housing Administration (FHA) published a mortgagee letter clarifying its conflict-of-interest policy to detail what individuals and employees can be compensated on a single-family transaction. NAR has long advocated for these changes to FHA in order to protect the federal government and FHA’s fund from potential losses and abuses of its programs.
The policy, effective immediately, dictates that participants with a direct impact on the mortgage approval decision cannot have multiple roles or sources of compensation from a single-family FHA transaction. This includes underwriters, appraisers, inspectors, and engineers. However, employees that do not have a direct impact on the approval decision can have additional roles for services performed and permitted by HUD, so long as they comply with all applicable transaction laws and requirements.