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f. Conflicts of Interest (12/15/2022)
This policy applies to all FHA-insured transactions unless otherwise specified in program requirements.
Participants that have a direct impact on the mortgage approval decision are prohibited from having multiple roles or sources of compensation, either directly or indirectly, from a single FHA-insured transaction. These participants are:
• underwriters
• Appraisers
• inspectors
• engineers
Indirect compensation includes any compensation resulting from the same FHA-insured transaction, other than for services performed in a direct role. Examples include, but are not limited to:
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I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021)
6. Post-approval Operations
• compensation resulting from an ownership interest in any other business that is a party to the same FHA-insured transaction; or
• compensation earned by a spouse, domestic partner, or other Family Member that has a direct role in the same FHA-insured transaction.
The Mortgagee must ensure that participants with a direct impact on the mortgage approval decision do not have multiple roles or sources of compensation from the same FHA-insured transaction.
Participants that do not have a direct impact on the mortgage approval decision may have multiple roles and/or sources of compensation for services actually performed and permitted by HUD, provided that the FHA-insured transaction complies with all applicable federal, state, and local laws, rules, and requirements.