FHA Home Inspection Criteria: What FHA, VA and USDA Require

Short answer: There is no such thing as an "FHA home inspection." FHA, VA and USDA set minimum property requirements that the appraiser checks, and all three tell the borrower to get a separate home inspection. As an inspector, your job is unchanged, but you should know which conditions those handbooks turn into required repairs, because your client, and their agent, will ask.

Clients using government-backed loans often believe the appraisal already checked the property, or that their inspection has to meet an "FHA standard." Both are wrong, and the fastest way to earn an agent's trust on these deals is to explain the difference clearly.

FHA, VA and USDA do not perform home inspections

Each agency says so in writing.

FHA. Lenders must give every FHA borrower form HUD-92564-CN, "For Your Protection: Get a Home Inspection," at first contact (HUD Handbook 4000.1, section II.A.1). The form says: "A home inspection will only occur if you arrange for one; FHA does not perform home inspections." It also says, in bold: "Appraisals are NOT Home Inspections!" and that "FHA does not guarantee the value or condition of your new home."

VA. VA Pamphlet 26-7, Chapter 12, has a subsection titled "Appraisal is Not a Home Inspection." It says "The fee appraiser will not perform operational checks of mechanical systems or appliances," and that the Notice of Value issued to the Veteran "includes a recommendation that the Veteran may wish to obtain a home inspection."

VA's own home buying page puts it more simply: "an appraisal isn't the same as an inspection."

USDA. Handbook HB-1-3555, section 12.9, says "Lenders must encourage applicants to obtain a detailed home inspection of the property" and "must provide applicants with Form HUD-92564-CN."

The Consumer Financial Protection Bureau's homebuyer toolkit makes the same point for every loan type: "A home inspector is different from a home appraiser."

The one exception: USDA says that if the appraiser is not familiar with the HUD standards, "the lender should obtain a home inspection report provided by a home inspector deemed qualified by the lender." That is the closest any of these programs comes to requiring your report.

What the FHA appraiser actually checks

HUD Handbook 4000.1 (last revised August 12, 2026) says the Minimum Property Requirements and Minimum Property Standards "form the basis for identifying the deficiencies of the Property that the Appraiser must note within the appraisal report" (section II.D.3.b).

The appraiser is not doing your job, but the handbook asks for more than many inspectors expect. From section II.D.3:

• Mechanical systems (II.D.3.f). "The Appraiser must operate the applicable systems and observe their performance." They operate a sample of switches, fixtures and receptacles, flush toilets and run a sample of faucets. They are "not required to insert any tool, probe or testing device inside the electrical panel."
• Heating. The permanent heating system must heat living areas "to a minimum of 50 degrees Fahrenheit." Central air is not required, but if installed it "must be operational."
• Water heater. Must have "a temperature and pressure-relief valve with piping to safely divert escaping steam or hot water."
• Roof (II.D.3.g). The roof must prevent moisture entry and have "a remaining physical life of at least two years." If less, the appraisal is made "subject to inspection by a professional roofer."
• Attic and crawl space (II.D.3.j and l). Observed "to the extent these areas are safely accessible." The appraiser does not move insulation or stored items.
• Appliances (II.D.3.d). Appliances that stay and contribute to value "must be operational."

Compare that with a home inspection under your state or association standard of practice, and the gap is obvious. The appraiser samples. You inspect.

A draft rewrite, not in effect. On September 22, 2026, FHA posted a draft rewrite of its Minimum Property Requirements on its Single Family Drafting Table, with feedback accepted through November 6, 2026 (FHA INFO 2026-22). FHA says the draft "is not official Departmental policy and cannot be used in connection with any FHA-insured mortgage until finalized," and that its existing policies remain in effect until amended. As of November 11, 2026, the Drafting Table lists it as not yet published. HUD's summary of the draft lists, among other changes: removing the roof covering section (II.D.3.g) and a heating and cooling section as redundant to UAD condition ratings, removing the defective exterior paint repair requirement, removing the specific attic, crawl space and kitchen appliance observation requirements, and reducing the lead-based paint repair scope from the entire property to the dwelling structure. Everything else on this page describes the handbook in force today. If the draft is finalized, several rows below will change.

Conditions the handbooks name as repair or further-inspection triggers

This is the table agents want. It lists conditions the FHA handbook and the VA pamphlet name directly. The lender, not the appraiser or you, decides which repairs are required: HUD says "Regardless of the Appraiser's suggested repairs, the Mortgagee will determine which repairs are required" (II.D.3.n).

What HUD says is not required. Section II.D.3.n says "Cosmetic or minor repairs are not required," and gives examples: "missing handrails that do not pose a threat to safety, holes in window screens, cracked window glass, defective interior paint surfaces in housing constructed after 1978, minor plumbing leaks that do not cause damage (such as a dripping faucet)." It also says that if a component "is functioning well but has not reached the end of its useful life, the Appraiser should not recommend replacement because of age."

VA takes the same line: appraisers "should not recommend repairs of cosmetic items" or minor deferred maintenance.

VA-specific points inspectors run into

Termite inspections. VA requires a wood destroying insect inspection report on the Notice of Value when the property is in an area mapped as "very heavy" or "moderate to heavy" termite infestation probability. High-rise condominium units are exempt. If you offer WDI work, this is steady demand. See our guides to the NPMA-33 form and WDO vs. WDI inspections.

No "subject to inspection" appraisals. VA says "Appraisers must not prepare appraisals subject to inspections." The appraiser recommends repairs instead. That is different from FHA, where the appraiser can condition the appraisal on a further inspection.

Water testing. For a private well, VA says "All testing must be performed by a disinterested third party," including collecting and transporting the sample, and "At no time will the Veteran or other interested party collect and/or transport the sample." Results are valid for 90 days unless the local authority says otherwise.

USDA-specific points

USDA's guaranteed loan program applies the HUD 4000.1 property standards to existing dwellings (HB-1-3555, section 12.9). A few rules differ:

• Termite and pest inspections are required "if the lender, appraiser, inspector, or State law requires the inspection." Note the word inspector: your report can trigger one.
• Well water analysis must come from "the local health authority or a state certified laboratory" and "must be no greater than 180 days old at loan closing" (section 12.6).
• Well to septic distance must be measured and must meet the HUD handbook or be acceptable to the local or state health authority.

Wells and water: three programs, three timelines

If you offer well inspection and water testing, these loan rules drive demand and timing.

FHA also requires a pressure tank with "a minimum capacity of 42 gallons," or a device that delivers the same between pump cycles.

What to do differently on a government-backed deal

Your inspection standard does not change. Your communication should.

1. Ask about the loan type when you book. Add it as a custom booking question. It tells you which follow-up services the client may need, such as WDI or water testing.
2. Explain the difference early. Point the client to HUD-92564-CN. They were supposed to get it at first contact.
3. Write findings that map cleanly. When you find peeling paint on a 1960s property, a roof near the end of its life or evidence of termites, say so plainly, with location and photos. The agent will cross-check your report against the appraisal. Our guide to defect comments that hold up helps.
4. Do not write "FHA required" in your report. You are not the appraiser or the lender. Describe the condition and recommend the right professional. Let the lender apply its rules.
5. Check your agreement on third-party reliance. With USDA, a lender may ask for your report. Your home inspection agreement should say who can rely on it.

Binsr templates are fully configurable, with custom comment types, tags and severity levels, so you can tag findings a lender may care about without changing your standard of practice. One inspection can also produce separate reports, such as a WDI form or a water test report next to the home inspection. Binsr has the NPMA-33 form built in.

Frequently asked questions

Keep reading

• Well inspections and water testing as an add-on
• The NPMA-33 form
• WDO vs. WDI inspections
• Radon testing for home inspectors
• What agents want from an inspection report
• How to price ancillary inspection services

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