source:
  type: guide
  id: hud-4000-1-i-c-eligibility-requirements
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part I — c. Eligibility
    Requirements (05/16/2024)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part I — c. Eligibility
    Requirements (05/16/2024).
  coverage_tier: operative
obligations:
- id: hud-4000-1-i-c-eligibility-requirements-full
  canonical_id: hud-4000-1-i-c-eligibility-requirements-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part I — c. Eligibility
    Requirements (05/16/2024)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part I — c. Eligibility
      Requirements (05/16/2024)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: 'c. Eligibility Requirements (05/16/2024) i. Business Form (A)
      Standard A Nonsupervised or Investing Mortgagee must be organized in one of
      the following acceptable business forms. A sole proprietorship is not an acceptable
      business form. (1) Corporation (a) Definition A Corporation is an entity chartered
      in the United States or its territories. (b) Standard The corporation must be
      organized in accordance with federal and state laws regarding corporations and
      must provide for permanent succession. (c) Required Documentation The corporation
      must submit copies of its articles of incorporation and bylaws with its application.
      I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application
      and Eligibility Requirements for Approval Handbook 4000.1 9 Last Revised: 11/26/2025
      (2) Limited Liability Company (a) Definition A Limited Liability Company (LLC)
      is organized under applicable state law which creates a legal entity with a
      combination of the legal and tax attributes of corporations and partnerships.
      (b) Standard The LLC must: • consist of two or more members, unless its single
      member is a corporation or LLC consisting of two or more persons or members;
      • ensure each natural person is of legal age as recognized by the state of incorporation
      at the time such natural person becomes a member; • have a minimum term of existence
      of 10 years from the date of application; and • provide for succession and continuance
      in the event of the withdrawal or death of a member. (c) Required Documentation
      The LLC must submit its Articles of Organization and operating agreement with
      its application. The Articles of Organization and operating agreement must contain
      language addressing the requirements listed in the FHA LLC Standard section
      above. The application must include the names and TINs of all members. (3) Series
      Limited Liability Company (a) Definition A Series LLC is a specific type of
      LLC that is composed of separate membership interests, which are divided into
      individual series. (b) Standard The Series LLC must comply with all requirements
      for approval of an LLC. The Series LLC must be organized in accordance with
      state law that does not conflict with FHA requirements. The Series LLC’s operating
      agreement must stipulate that: • no series may participate in FHA programs unless
      the approved Mortgagee owns 100 percent of the membership interests in that
      series; and I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021)
      3. Application and Eligibility Requirements for Approval Handbook 4000.1 10
      Last Revised: 11/26/2025 • the approved Mortgagee remains fully liable for the
      debts, liabilities, obligations and expenses of any and all series that participate
      in FHA programs. (c) Required Documentation The Series LLC must submit its Articles
      of Organization and operating agreement with its application. The application
      must include the names and TINs of all series participating in FHA programs
      and of all members in the series participating in FHA programs. (4) Partnership
      (a) Definition A Partnership is a for-profit business operation between two
      or more entities that share ownership and management responsibilities. (b) Standard
      The partnership must: • be organized in accordance with relevant state law;
      • have a term of existence that continues for a minimum term of 10 years from
      the date of application; and • be structured to continue to exist even if a
      partner withdraws. Each general partner must be a corporation or other chartered
      institution consisting of two or more individuals. The partnership must designate
      a managing general partner, who: • has as its principal activity the management
      of one or more partnerships, all of which are Mortgagees, lenders, or property
      improvement or Manufactured Housing loan lenders; and • has exclusive authority
      to deal directly with the Secretary or its designee on behalf of each partnership.
      (c) Required Documentation The partnership must submit its partnership agreement.
      The partnership agreement must contain language addressing the requirements
      listed in the FHA Partnership Standard section above. The partnership must submit
      the names and TINs of all general partners as well as the names and SSNs of
      all officers and directors of the managing general partner. I. DOING BUSINESS
      WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application and Eligibility
      Requirements for Approval Handbook 4000.1 11 Last Revised: 11/26/2025 (5) Nonprofit
      (a) Definition A nonprofit is a charitable organization or corporation, civic
      league, social welfare organization, or local employee association organized
      for purposes other than profit. (b) Standard The nonprofit must be recognized
      as exempt from taxation by the Internal Revenue Service (IRS) under Internal
      Revenue Code (IRC) Section 501(a) as an entity described in Sections 501(c)(3)
      and (4). A nonprofit organized as a Corporation, LLC, or Partnership must also
      comply with all requirements for the applicable business form. (c) Required
      Documentation The nonprofit must provide a copy of its IRS exemption letter.
      The nonprofit must submit all Business Formation Documents required of its business
      form. (B) Required Documentation The Mortgagee must submit its Business Formation
      Documents in the online application. ii. Mortgagee Name (A) Definitions (1)
      Institution Name The Mortgagee’s Institution Name is the legally registered
      corporate name associated with the Mortgagee’s home office. (2) “Doing Business
      As” Name The “Doing Business As” (DBA) name is any registered name or alias
      that the Mortgagee has a legal right to use. (B) Standard The Mortgagee must
      use as its institution or DBA name the name shown on its Business Formation
      Documents or for which it has received approval from its state of formation.
      The Mortgagee is prohibited from using any restricted word in, or as part of,
      its institution or DBA name in a manner that would violate the Helping Families
      Save Their Homes Act of 2009 (Pub.L. 111–22) or 18 U.S.C. § 709, which places
      I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application
      and Eligibility Requirements for Approval Handbook 4000.1 12 Last Revised: 11/26/2025
      restrictions on “federal,” “government,” or “national” and related words, unless
      the Mortgagee is exempt from these statutory prohibitions. The Mortgagee’s institution
      name and all DBA names used by a Mortgagee for conducting FHA business must
      be registered with FHA. The Mortgagee must use only those names that are registered
      with FHA in Advertising and promotional materials related to FHA programs. (C)
      Required Documentation A Nonsupervised or Investing Mortgagee must submit its
      Business Formation Documents. A Supervised Mortgagee must submit a copy of the
      state license or registration for its home office as verification of its institution
      name. The Mortgagee must submit documentation from the state showing it is legally
      approved to use its institution name or DBA name, if the name differs from that
      shown on its Business Formation Documents. iii. Office Facilities (A) Definitions
      (1) Home Office The Mortgagee’s Home Office is the main office from which it
      manages its FHA business. (2) Branch Offices Branch Offices are all other offices
      from which a Mortgagee will conduct its FHA business. (B) Standard (1) Home
      Office A Mortgagee must designate a headquarters or “home office” for its FHA
      business. A Mortgagee’s home office does not have to be its corporate office.
      The Mortgagee’s home office must have a staff of at least two full-time employees.
      The Mortgagee may not rely on a shared receptionist to satisfy this full-time
      employee requirement. A Mortgagee’s home office facility must: • be located
      in a commercial space that is separate from any other entity (except for reception-type
      entrances or lobbies); I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees
      (09/20/2021) 3. Application and Eligibility Requirements for Approval Handbook
      4000.1 13 Last Revised: 11/26/2025 • be clearly identified, including having
      a permanently affixed business sign and other means of identification commonly
      used by businesses, so that the general public and other businesses will know,
      at all times, exactly which entity is being represented and is conducting business;
      and • display a fair housing poster if the Mortgagee deals with Borrowers and
      the general public. Exception for Investing Mortgagee without Servicing Authority
      In lieu of the staffing and facilities requirements, an Investing Mortgagee
      shall have officers or employees who are capable of managing its activities
      in purchasing, holding, and selling Title I Loans or Title II Mortgages. (2)
      Branch Offices Mortgagees may register any branch offices that will conduct
      FHA business in accordance with the requirements set forth in the branch office
      requirements. This includes any branches that will originate, underwrite, and/or
      service FHA-insured Mortgages. The Mortgagee must ensure each registered branch
      office has at least one full- time employee. The Mortgagee may not rely on a
      shared receptionist or contractors to satisfy this full-time employee requirement.
      The Mortgagee must display a fair housing poster in branch offices that deal
      with Borrowers and the general public. (C) Required Documentation FHA will verify
      compliance with the office facilities requirements through any onsite visits.
      The Mortgagee must maintain an up-to-date list of all offices meeting the standard.
      iv. Ownership and Personnel The Mortgagee must comply with the following requirements
      for its ownership and personnel. (A) Principal Owners (1) Definition A Principal
      Owner is any individual or entity meeting the following thresholds or roles
      for the applicable business form: Business Form Principal Owners Publicly Traded
      Corporation 10% or more ownership I. DOING BUSINESS WITH FHA A. FHA Lenders
      and Mortgagees (09/20/2021) 3. Application and Eligibility Requirements for
      Approval Handbook 4000.1 14 Last Revised: 11/26/2025 Business Form Principal
      Owners Private or Close Corporation 25% or more ownership Limited Liability
      Company All Members Partnerships All Partners (2) Standard The Mortgagee must
      ensure that none of its Principal Owners are suspended, debarred, or otherwise
      excluded from participation in FHA programs. See Restricted Participation. (3)
      Required Documentation A Supervised, Nonsupervised, or Investing Mortgagee must
      identify all Principal Owners. The Mortgagee must submit this information in
      the online application. (B) Personnel Requirements (1) Corporate Officers (a)
      Definitions (i) Corporate Officers of Nonsupervised and Investing Mortgagees
      A Corporate Officer is a natural person who serves as one of the following positions
      for a Nonsupervised or Investing Mortgagee: • owner; • President; • Vice President
      in charge of managing or overseeing any aspect of the Mortgagee’s FHA business;
      • Chief Operating Officer (COO); • Chief Financial Officer (CFO); • Director;
      • Corporate Secretary; • Chief Executive Officer (CEO); • General Counsel; •
      Chairman of the Board; • General Partner; or • member or manager of an LLC.
      (ii) Corporate Officers of Supervised and Government Mortgagees A Corporate
      Officer is a natural person who serves as one of the following positions for
      a Supervised or Government Mortgagee: • President; I. DOING BUSINESS WITH FHA
      A. FHA Lenders and Mortgagees (09/20/2021) 3. Application and Eligibility Requirements
      for Approval Handbook 4000.1 15 Last Revised: 11/26/2025 • Vice President in
      charge of managing or overseeing any aspect of the Mortgagee’s FHA business;
      • Chief Operating Officer (COO); • Chief Financial Officer (CFO); • Director;
      • Corporate Secretary; • Chief Executive Officer (CEO); • General Counsel; •
      Chairman of the Board; • General Partner; or • specifically designated staff
      member(s) of a Government Mortgagee. (b) Standard The Mortgagee must ensure
      that no Corporate Officers are suspended, debarred or otherwise excluded from
      participation in FHA programs. See Restricted Participation. The Mortgagee must
      ensure its Corporate Officers only represent a single Mortgagee, unless the
      following criteria are met: • the entities represented have some or all of the
      same Corporate Officers or Principal Owners; and • there is a clear and effective
      separation of the entities, and Borrowers know at all times exactly which entity
      is being represented and with whom they are conducting business. (c) Required
      Documentation The Mortgagee must identify all Corporate Officers listed above
      who will be directly involved in managing, overseeing, or conducting FHA business.
      The Mortgagee must submit all of this information in the online application.
      A Nonsupervised, Government, or Investing Mortgagee must submit a current resume
      covering the most recent seven-year period for each of these Corporate Officers.
      (2) Officer in Charge (a) Definition The Officer in Charge is the Corporate
      Officer designated to manage and direct the Mortgagee’s FHA operations. I. DOING
      BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application
      and Eligibility Requirements for Approval Handbook 4000.1 16 Last Revised: 11/26/2025
      (b) Standard The Mortgagee must designate as the Officer in Charge a full-time
      Corporate Officer who is exclusively employed by the Mortgagee and has at least
      three years of experience in the specific Mortgagee functions or activities
      that the Mortgagee is approved to perform, including: • originating or servicing
      Single Family or multifamily Mortgages; • investing funds in real estate Mortgages;
      or • managing other individuals performing these services. A Corporate Officer’s
      experience in real estate sales or brokerage does not qualify. (i) Exception
      for Officer in Charge of an Investing Mortgagee without Servicing Authority
      An Officer in Charge of an Investing Mortgagee without servicing authority is
      not required to be exclusively employed by the Mortgagee. (c) Required Documentation
      The Mortgagee must designate the Officer in Charge and submit a current resume
      covering the most recent seven-year period detailing the individual’s relevant
      experience in the online application. (3) Employees (a) Definition Employees
      are individuals under the direct supervision and control of the Mortgagee. (b)
      Standard (i) Eligibility of Employees The Mortgagee must not employ any individual
      who will participate in FHA transactions if the individual is suspended, debarred,
      under a Limited Denial of Participation (LDP), or otherwise excluded from participation
      in FHA programs. See Restricted Participation. (ii) Compensation The Mortgagee
      must not compensate employees who perform underwriting or Quality Control (QC)
      activities on a commission basis. I. DOING BUSINESS WITH FHA A. FHA Lenders
      and Mortgagees (09/20/2021) 3. Application and Eligibility Requirements for
      Approval Handbook 4000.1 17 Last Revised: 11/26/2025 The Mortgagee must report
      all employee compensation in accordance with IRS requirements. (iii) Secure
      and Fair Enforcement for Mortgage Licensing Act of 2008 Compliance The Mortgagee
      must ensure that it and its employees comply with the requirements of the Secure
      and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) (12 U.S.C.
      § 1501 et seq.), including the licensing and registration of its employees in
      the NMLS. (iv) Conflicts of Interest The Mortgagee’s employees will be subject
      to FHA’s Conflicts of Interest policy. (v) Underwriters The Mortgagee must ensure
      that its underwriters are not managed by and do not report to any individual
      who performs mortgage origination activities. The Mortgagee must ensure that
      its underwriters: • meet basic eligibility requirements; and • perform the underwriting
      function in a manner consistent with FHA guidelines. (vi) HECM Originators The
      Mortgagee and any other party that participates in the origination of a HECM
      transaction must not participate in, be associated with, or employ any party
      that participates in or is associated with any other financial or insurance
      activity, unless the Mortgagee demonstrates that it or any other party maintains
      firewalls and other safeguards designed to ensure that: • individuals participating
      in the origination of the HECM must have no involvement with, or incentive to
      provide the Borrower with, any other financial or insurance product; and • the
      Borrower must not be required, directly or indirectly, as a condition of obtaining
      a HECM, to purchase any other financial or insurance product. (c) Required Documentation
      The Mortgagee must certify that it meets these requirements in the online application.
      I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application
      and Eligibility Requirements for Approval Handbook 4000.1 18 Last Revised: 11/26/2025
      v. Creditworthiness (A) Definitions (1) Institutional Creditworthiness A Creditworthy
      Institution is a Mortgagee with a credit background for the seven- year period
      preceding the FHA Mortgagee approval application or the lifespan of the institution
      if less than seven years that: • reflects no delinquent accounts or collections
      and no legal actions; or • reflects legal actions that have been adequately
      resolved, and/or delinquent accounts or collections that have been adequately
      resolved or that have an acceptable explanation. (2) Individual Creditworthiness
      A Creditworthy Individual is a person whose credit background for the seven-year
      period preceding the FHA Mortgagee approval application or for the length of
      the individual’s credit history if less than seven years: • reflects no delinquent
      accounts or collections, and reflects no legal actions that would impair the
      individual’s credit, such as a foreclosure action, judgment, lien, or bankruptcy;
      or • reflects legal actions that have been adequately resolved, and/or delinquent
      accounts or collections that have been adequately resolved or that have an acceptable
      explanation. (B) Standard A Nonsupervised or Investing Mortgagee must demonstrate
      that it is a creditworthy institution, and that its Principal Owners and Corporate
      Officers are creditworthy individuals. (C) Required Documentation A Nonsupervised
      or Investing Mortgagee must submit the following credit reports. (1) Report
      on Mortgagee A Nonsupervised or Investing Mortgagee must submit a commercial
      credit report not more than 90 Days old with its application. The Mortgagee
      must provide written explanations for all negative items disclosed on the credit
      report. (2) Reports on Principal Owners and Corporate Officers A Nonsupervised
      or Investing Mortgagee must submit a personal credit report for each of its
      Principal Owners and Corporate Officers with its application. The I. DOING BUSINESS
      WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application and Eligibility
      Requirements for Approval Handbook 4000.1 19 Last Revised: 11/26/2025 personal
      credit report must be a Residential Mortgage Credit Report (RMCR) or a Tri-Merged
      Credit Report (TRMCR) not more than 90 Days old. The Mortgagee must submit a
      written explanation from the relevant Principal Owner or Corporate Officer for
      any negative item disclosed on the credit report. vi. State License or Registration
      Supervised, Nonsupervised, and Investing Mortgagees must meet the following
      licensing requirements. (A) Business License or Registration (1) Standard The
      Mortgagee must ensure that its home office and each branch office have all licenses,
      registrations, or approvals required for the types of Mortgagee functions or
      activities performed by such office for the jurisdiction in which that office
      is located. A Mortgagee that has been refused a state license or been Sanctioned
      by any state in which it will originate FHA Mortgages must disclose the circumstances
      of the refusal or Sanction and the resolution to FHA. (2) Required Documentation
      The Mortgagee must submit a copy of its state license, registration or equivalent
      approval for the state in which the home office is located. The Mortgagee, through
      a Corporate Officer, must certify at application that it has not been refused
      a license or been sanctioned by any state in which it will originate FHA Mortgages.
      If the Mortgagee has been subject to an action against its license, it is Unable
      to Certify. It must follow the unable to certify procedures and must submit
      documentation concerning the action that shows the nature of the action and
      evidence of an acceptable resolution (such as reinstatement or subsequent approval
      of a license, payment of Sanctions or fines, or similar documentation). (3)
      Exception for Mortgagees Exempt from State Licensing Requirements If the Mortgagee
      is exempt from state licensing requirements, the Mortgagee must submit documentation
      of the applicable exemption. I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees
      (09/20/2021) 3. Application and Eligibility Requirements for Approval Handbook
      4000.1 20 Last Revised: 11/26/2025 (B) Personnel Licenses (1) Standard The Mortgagee
      must ensure that its Corporate Officers, employees, and Affiliates conducting
      FHA business for or on behalf of the Mortgagee have all state and federal licenses
      and registrations required for the Mortgagee functions or activities that such
      individuals or Affiliates will perform. (2) Required Documentation The Mortgagee
      must certify that it meets this requirement as part of the online application.
      vii. Financial Requirements (A) Standard Supervised, Nonsupervised, and Investing
      Mortgagees must meet the following adjusted net worth and liquidity requirements
      at all times. (1) Adjusted Net Worth The Mortgagee must compute its adjusted
      net worth in accordance with the HUD OIG Handbook 2000.04, Consolidated Audit
      Guide for Audits of HUD Programs. (a) Single Family Programs The Mortgagee must
      have a minimum adjusted net worth of $1,000,000 plus 1 percent of the total
      volume in excess of $25,000,000 of FHA Single Family Mortgages originated, underwritten,
      serviced, and/or purchased during the prior fiscal year, up to a maximum required
      adjusted net worth of $2,500,000 at all times. (b) Multifamily Programs (i)
      With Servicing The Mortgagee must have a minimum adjusted net worth of $1,000,000
      plus an additional net worth of 1 percent of the total volume in excess of $25,000,000
      of FHA multifamily Mortgages originated, purchased, and/or serviced during the
      prior fiscal year, up to a maximum required net worth of $2,500,000. (ii) Without
      Servicing The Mortgagee must have a minimum adjusted net worth of $1,000,000
      plus an additional net worth of one-half of 1 percent of the total volume in
      I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021) 3. Application
      and Eligibility Requirements for Approval Handbook 4000.1 21 Last Revised: 11/26/2025
      excess of $25,000,000 of FHA multifamily Mortgages originated during the prior
      fiscal year, up to a maximum required net worth of $2,500,000. (c) Dual Participation
      A Mortgagee approved to participate in both Single Family and multifamily programs
      must have a minimum adjusted net worth of $1,000,000 plus an additional net
      worth of 1 percent of the total volume in excess of $25,000,000 of the aggregate
      of FHA Single Family and multifamily Mortgages originated, underwritten, purchased,
      and/or serviced during the prior fiscal year, up to a maximum required net worth
      of $2,500,000. (2) Liquidity Liquid assets must be computed in accordance with
      the HUD OIG Handbook 2000.04, Consolidated Audit Guide for Audits of HUD Programs.
      The Mortgagee must hold no less than 20 percent of its required adjusted net
      worth in liquid assets. (B) Exception for Government Mortgagees The adjusted
      net worth and liquidity requirements do not apply to Government Mortgagees.
      Government Mortgagees are not required to submit financial information to FHA.
      (C) Required Documentation Supervised, Nonsupervised, and Investing Mortgagees
      must submit the computation of adjusted net worth, along with the documentation
      described below. (1) Small Supervised Mortgagees A Small Supervised Mortgagee
      must submit a copy of its Unaudited Regulatory Report (i.e., report of condition
      and income, also known as the “call report,” which is submitted on the Federal
      Financial Institutions Examination Council Forms 031, Consolidated Reports of
      Condition and Income for a Bank with Domestic and Foreign Offices, and 041,
      Consolidated Reports of Condition and Income for a Bank with Domestic Offices
      Only; or a consolidated or fourth quarter NCUA call report, submitted on NCUA
      Form 5300 or 5310) signed by a Corporate Officer that aligns with its fiscal
      year end. I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021)
      3. Application and Eligibility Requirements for Approval Handbook 4000.1 22
      Last Revised: 11/26/2025 (2) Large Supervised, Nonsupervised, and Investing
      Mortgagees (a) Audit of Financial Statements The Mortgagee must submit financial
      statements reported in accordance with the HUD OIG Handbook 2000.04, Consolidated
      Audit Guide for Audits of HUD Programs. (b) Accounting and Auditing Standards
      The Mortgagee must have prepared its financial statements in accordance with
      Generally Accepted Accounting Principles (GAAP) and had its audit performed
      in accordance with Generally Accepted Auditing Standards (GAAS). (c) Audit Period
      Covered A Mortgagee’s audited financial statements must cover the most recent
      fiscal year. For companies operating for fewer than 12 months, the audited financial
      statements must cover all months of operation. The end date of the audited financial
      statements must align with the applicant’s fiscal year end period at the time
      of application. If the end date for the audited financial reports is more than
      six months old, the Mortgagee must also submit unaudited financial statements,
      signed by a Corporate Officer, for the most recent interim accounting period
      ending less than three months prior to submission of the application. viii.
      Principal Activity of Nonsupervised Mortgagees (A) Standard A Nonsupervised
      Mortgagee must derive at least 50 percent of its gross revenue from its activities
      in lending or investing of funds in real estate Mortgages, consumer installment
      notes or similar advances of credit, the purchase of consumer installment contracts,
      or from a directly related field. A directly related field is something directly
      related to the lending or investing of funds in real estate Mortgages, not simply
      actions relating to real estate in general. (B) Required Documentation The Nonsupervised
      Mortgagee must submit audited financial statements that reflect the sources
      of its revenue. I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021)
      3. Application and Eligibility Requirements for Approval Handbook 4000.1 23
      Last Revised: 11/26/2025 ix. Funding Program (A) Nonsupervised Mortgagees (1)
      Standard A Nonsupervised Mortgagee that originates FHA Mortgages must maintain
      a warehouse line of credit or other mortgage-funding program acceptable to FHA.
      Title I Mortgagees must have a minimum $500,000 warehouse line of credit or
      funding program. Except for multifamily Mortgagees, Title II Mortgagees must
      have a minimum $1,000,000 warehouse line of credit or funding program, and must
      ensure the funding program or warehouse line of credit is sufficient to fund
      the Mortgagee’s average 60-Day origination operations. The Mortgagee’s average
      60-Day origination operations refer to loans closed and funded, and/or purchased
      by the Mortgagee during the Mortgagee’s highest 60-Day period by mortgage amount
      over the past 12 months. (2) Required Documentation The Mortgagee must submit
      documentation that it either 1) has a line of credit issued directly to the
      Mortgagee; or 2) has an agreement with a financial institution. The documentation
      must ensure the funding program or warehouse line of credit is sufficient to
      fund the Mortgagee’s average 60-Day origination operations. (B) Investing Mortgagees
      (1) Standard An Investing Mortgagee must have available, or have arranged for,
      funds or a line of credit sufficient to support a projected investment of at
      least $1,000,000 in property improvement, Manufactured Housing or real estate
      loans or Mortgages. (2) Required Documentation The Mortgagee must submit documentation
      that it either 1) has a line of credit issued directly to the Mortgagee; or
      2) has an agreement to support the projected investment. x. Fidelity Bond (A)
      Standard A Mortgagee must have fidelity bond coverage that meets the minimum
      coverage amount set by FHA. The Mortgagee must ensure that its fidelity bond
      coverage is in a I. DOING BUSINESS WITH FHA A. FHA Lenders and Mortgagees (09/20/2021)
      3. Application and Eligibility Requirements for Approval Handbook 4000.1 24
      Last Revised: 11/26/2025 form generally acceptable to one of the secondary mortgage
      market agencies, such as Freddie Mac, Fannie Mae, or the Government National
      Mortgage Association (GNMA, or Ginnie Mae). A Government Mortgagee will meet
      this requirement if it maintains alternative insurance coverage that is approved
      by FHA and that ensures the faithful performance of the Mortgagee’s responsibilities.
      (B) Required Documentation The Mortgagee must submit documentation evidencing
      that it has acceptable fidelity bond coverage. xi. Errors and Omissions Insurance
      (A) Standard A Mortgagee must have errors and omissions insurance that meets
      the minimum coverage amount set by FHA. The Mortgagee must have errors and omissions
      insurance that is generally acceptable to one of the secondary market agencies,
      such as Freddie Mac, Fannie Mae, or Ginnie Mae. A Government Mortgagee will
      meet this requirement if it maintains alternative insurance coverage that is
      approved by FHA and that ensures the faithful performance of the Mortgagee’s
      responsibilities. (B) Required Documentation The Mortgagee must submit documentation
      evidencing that it has acceptable errors and omissions insurance. xii. Quality
      Control Plan (A) Standard A Title II Mortgagee and Title I Lender that originates,
      underwrites, closes, endorses, or services FHA-insured Title II Mortgages or
      Title I Loans must have a QC Plan that meets FHA’s requirements, as described
      in Quality Control, Oversight, and Compliance. The Title II Mortgagee and Title
      I Lender must maintain and update its QC Plan as needed to ensure it is fully
      compliant with all applicable FHA requirements at all times. (B) Required Documentation
      The Mortgagee must submit a copy of its QC Plan. I. DOING BUSINESS WITH FHA
      A. FHA Lenders and Mortgagees (09/20/2021) 3. Application and Eligibility Requirements
      for Approval Handbook 4000.1 25 Last Revised: 11/26/2025 The Title II Mortgagee
      and Title I Lender must maintain and update its QC Plan as needed to ensure
      it is fully compliant with all applicable FHA requirements at all times. xiii.
      Unique Entity Identifier All FHA-approved Mortgagees must register for, obtain,
      and maintain a Unique Entity Identifier (UEI) number at www.SAM.gov and the
      registration must result in a status of “Active Registration.” To maintain an
      “Active Registration” in the SAM.gov database after the initial registration,
      the applicant is required to review and update its information in the SAM.gov
      database every 365 days to ensure it is current, accurate, and complete. The
      UEI must be entered in the Lender Electronic Assessment Portal (LEAP) Institution
      Profile to demonstrate compliance. The “Core Data” in www.SAM.gov must match
      the TIN and institution name in the LEAP Institution Profile for the approved
      Mortgagee.'
  judgment: false
