The Federal Housing Administration (FHA) issued clarification on Thursday regarding the extent in which employees in single-family housing transactions are allowed to play dual roles — and how much they are allowed to be compensated from a single FHA-insured transaction.

The clarification, issued in a Mortgagee Letter by FHA Commissioner Julia Gordon, notes that participants who 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.”

In particular, the restrictions pertain to four types of employees: underwriters, appraisers, inspectors details ⇒

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