Risk Assessment & Mitigation Flashcards
7 cards from real FHA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Assessment & Mitigation flashcards as text
Under FHA guidelines, what minimum remaining economic life must a property have relative to the mortgage term?
Answer: The remaining economic life must equal or exceed the mortgage term
FHA requires the appraiser to estimate remaining economic life and confirm it is at least equal to the mortgage term to ensure the collateral will support the loan.
When appraising a manufactured home for FHA financing, which foundation requirement must be met?
Answer: The home must be on a permanent foundation per the HUD Permanent Foundations Guide for Manufactured Housing
FHA requires manufactured homes to be on a permanent foundation that meets HUD's Permanent Foundations Guide, and an engineer certification is typically required.
An appraiser discovers that a property is located within 300 feet of a former dry-cleaning facility. What risk must be considered?
Answer: Soil and groundwater contamination from dry-cleaning solvents such as PCE/TCE
Dry-cleaning facilities commonly use perchloroethylene (PCE) and other chlorinated solvents that can contaminate soil and groundwater, posing environmental and health risks.
What is the FHA appraiser's responsibility when a property has a private well as the sole water source?
Answer: Require water quality testing that meets EPA safe drinking water standards unless waived by the lender
FHA requires water quality testing for private wells to ensure the water meets EPA standards for potability, protecting the health of future occupants.
How should an FHA appraiser handle a property where the septic system was recently pumped but shows signs of failure such as surfacing effluent?
Answer: Flag the system as a required repair and recommend inspection by a licensed septic professional
Surfacing effluent is a clear sign of septic failure; FHA requires the system to be functional, and a professional inspection must be completed before closing.
A home's crawl space has standing water and visible mold growth. Under FHA guidelines, this condition is classified as:
Answer: A health and safety hazard requiring remediation before loan closing
Standing water and mold in a crawl space constitute a health and safety hazard under FHA Minimum Property Requirements, requiring remediation prior to FHA loan closing.
Which statement best describes the FHA appraiser's role regarding radon gas?
Answer: Appraisers should recommend radon testing if the property is in a high-risk zone and evidence of mitigation is absent
FHA appraisers are expected to be aware of radon risk zones and recommend testing when indicators suggest elevated risk, though testing is not automatically required for all properties.