U.S. Department of Housing and Urban Development
Mortgagee Letter 2026-10
Date: June 23, 2026
Subject: Updates to FHA Quality Control Requirements for Appraisal Field Reviews
Source: https://www.hud.gov/sites/default/files/hudclips/documents/2026-10hsgml.pdf

Purpose: This Mortgagee Letter (ML) updates FHA quality control (QC) requirements
to allow greater flexibility and alternatives to appraisal field reviews.

Effective Date: The provisions of this ML are effective immediately. All updates
will be incorporated into a forthcoming update of the HUD Handbook 4000.1, FHA
Single Family Housing Policy Handbook (Handbook 4000.1). AS OF THIS ML'S
EFFECTIVE DATE, THE HANDBOOK 4000.1 TEXT HAS NOT YET BEEN UPDATED TO REFLECT THIS
CHANGE — THIS ML IS THE CONTROLLING DOCUMENT UNTIL THE HANDBOOK CATCHES UP.

Affected Programs: All FHA-insured mortgage programs.

Summary of Changes: This ML updates requirements in Property and Appraisals
(V.A.3.c.ii(C)). Specifically, it makes appraisal field reviews an OPTIONAL
component of appraisal QC, removing the prior requirement that Mortgagees obtain
appraisal field reviews on at least 10 percent of origination and underwriting QC
reviews. Field reviews may still be obtained if the Mortgagee determines they're
needed to adequately assess an appraisal report's compliance, but they are no
longer mandatory at the 10% sampling level.

Full redlined text of Handbook 4000.1 Property and Appraisals (V.A.3.c.ii(C)),
before and after this change, is preserved in Attachment 1 of the source PDF
(see Source URL above) — download the full PDF for the complete redline if a
word-for-word comparison is ever needed.

Signed: Joseph M. Gormley, Performing the Delegable Duties of the Assistant
Secretary for Housing - Federal Housing Commissioner