Environmental Hazards & Site Conditions Flashcards

Under FHA guidelines, when must an appraiser identify and flag defective paint in a pre-1978 home?

Answer: Whenever paint is peeling, chipping, flaking, or otherwise defective on any surface

FHA Handbook 4000.1 requires appraisers to identify all defective paint—peeling, chipping, flaking, or worn—on any interior or exterior surface of pre-1978 homes and require repair (paint stabilization) before loan closing.

What is the minimum required distance between a private well and a septic tank under FHA Minimum Property Requirements (MPR)?

Answer: 50 feet

FHA MPRs specify that a private well must be at least 50 feet from any septic tank to minimize the risk of contamination of the drinking water supply.

A property is located in FEMA Flood Zone AE. What must an FHA appraiser note in the appraisal report?

Answer: That the property is in a Special Flood Hazard Area and NFIP flood insurance will be required as a condition of FHA financing

Zone AE is a Special Flood Hazard Area (SFHA); FHA requires the appraiser to note this and flag that NFIP flood insurance is a mandatory condition of the loan.

When an FHA appraiser observes friable asbestos-containing materials (ACM) in a home, what is the appropriate course of action?

Answer: Note the condition in the report and require remediation by a licensed professional before loan closing

Friable ACM is a health and safety hazard; FHA appraisers must note its presence and condition the appraisal on remediation by a qualified asbestos abatement contractor prior to loan closing.

Which condition related to underground storage tanks (USTs) requires an FHA appraiser to flag a property for further environmental review?

Answer: Observable evidence of a current or former UST on the subject property or within approximately 300 feet

FHA guidance directs appraisers to flag evidence of current or former USTs on the property or within the immediate vicinity (approximately 300 feet) as a potential environmental hazard requiring further investigation.

What is the FHA appraiser's primary responsibility when a property is located in a high-radon-potential zone?

Answer: Note the high-radon-potential designation and recommend radon testing by a qualified specialist if appropriate

Appraisers are not radon inspectors; their role is to note if the property is in a high-radon-potential area per EPA maps and recommend further testing by a qualified professional, not to test or require mitigation themselves.

A pre-1978 home has lead-based paint that is intact, well-adhered, and shows no visible deterioration. Under FHA guidelines, what action is required?

Answer: Note the potential presence of LBP but require no repair action if the paint is not defective

FHA only requires repair of defective (peeling, chipping, flaking) lead-based paint; intact, well-adhered paint in pre-1978 homes does not trigger a repair requirement.