FHA loans · HUD Handbook 4000.1FHA loan on new construction: the inspections and builder forms the lender needs

HUD Handbook 4000.1 treats a home as new construction when it is proposed (no concrete or permanent material placed yet – digging footings doesn't count), under construction (from the first permanent material until 100% complete with no certificate of occupancy), or existing less than one year (complete, certificate of occupancy issued less than a year ago, and never occupied). A home sold after someone has lived in it is treated as existing, even if it's less than a year old. Site-built homes of one to four units (including one unit with an ADU), condo units in approved projects or legal phases and manufactured homes are eligible. For a site-built home the lender needs, depending on the stage at appraisal, the building permit and certificate of occupancy, or inspections by the local authority or an ICC-certified inspector – footing, framing and final for proposed construction, a final inspection otherwise – or, where no such inspector exists, by a licensed and bonded architect, structural engineer or qualified tradesperson. The case binder also needs form HUD-92541, the Builder's Certification of Plans, Specifications, and Site; form HUD-92544, the Warranty of Completion of Construction; inspection reports on form HUD-92051 or a state form; termite form HUD-NPMA-99-A (and 99-B if the home was treated) unless the county is exempt; a well water analysis where there's a well; and a septic report where the local authority requires one. The appraiser gets a HUD-92541 signed no more than 30 days before the appraisal was ordered, plus plans for a home 90% complete or less, or a list of remaining items for one more than 90% complete. New construction must meet HUD's Minimum Property Requirements and Standards.