FR-6609-N-01 Request for Information Regarding Single Family Minimum Property Requirements (MPR)

The Collateral Risk Network (CRN) supports the FHA's effort to modernize and streamline Single Family Minimum Property Requirements (MPRs) to reduce regulatory burdens and improve access to housing. They argue that current MPRs are often outdated, overly rigid, and place unnecessary technical inspection burdens on appraisers, and they recommend focusing on material defects while clarifying communication and appraiser roles.

The commenter, a former government regulator now working for a lender, argues that FHA should maintain its distinct Minimum Property Requirements (MPRs) rather than adopting the Fannie Mae and Freddie Mac Property Condition Rating (PCR) framework. They advocate for simplifying and clarifying the existing MPRs—such as defining "habitable" and reducing intrusive inspection requirements—to protect entry-level borrowers while improving operational efficiency for lenders and appraisers.

The commenter suggests that FHA should expand post-closing repair flexibility by providing specific guidance on escrow limits and timeframes. They also recommend creating a dedicated, easily identifiable section for Minimum Property Requirements (MPRs) in the Handbook to improve clarity for stakeholders.

A veteran Certified General Appraiser argues that appraisers lack the specific training and insurance coverage to certify the condition of home components. The commenter suggests that if condition certification is the goal, a professional inspector should be engaged instead of relying on the appraisal.

Richard Negro, a Certified Residential Appraiser, supports the modernization of FHA's Minimum Property Requirements (MPRs) by advocating for clearer definitions of "Safety" and a distinct separation of responsibilities between appraisers and underwriters. He argues that FHA should provide more objective guidance and training to reduce inconsistent underwriting decisions and improve transparency for borrowers.

A group of leading appraisal organizations supports the FHA's efforts to modernize Minimum Property Requirements (MPRs) while emphasizing the need to preserve borrower protections and collateral risk management. They argue that modernization should focus on improving clarity, consistency, and reducing administrative burdens rather than weakening fundamental safety standards.

An individual appraiser (implied by the context of navigating appraisal guidelines) suggests that HUD should make its Minimum Property Requirements (MPR) more accessible, clearer, and more regionally specific. The commenter advocates for public transparency and the creation of a basic checklist for borrowers to reduce ambiguity during the appraisal process.

The American Valuation Society (AVS) supports the modernization of FHA's Minimum Property Requirements (MPRs) by recommending the adoption of a shared FHA–VA existing-home property acceptability standard. They argue for aligning FHA's processes with the VA's model—specifically regarding visual appraisal scope, named review filters, and proportional repair verification—while adopting the GSE's condition and quality rating systems to ensure consistency across all lending channels.

The Association of Texas Appraisers (ATA) supports the FHA's efforts to modernize and streamline Minimum Property Requirements (MPRs) by advocating for a converged, two-layer system with the VA and GSEs. They argue for adopting shared UAD condition ratings and data standards while maintaining a stricter, separate eligibility decision for public programs to ensure safety and consistency across the mortgage market.

The National Association of Appraisers (NAA) supports modernizing FHA's Minimum Property Requirements (MPRs) to align with GSE requirements. They argue that current MPRs create unnecessary barriers for borrowers and suggest streamlining the process by reducing requirements that exceed GSE standards and allowing for more flexible repair options like escrows or virtual inspections.