FHA issued Mortgagee Letter 2025-18 eliminating outdated and costly FHA appraisal protocols. Per the Mortgagee Letter (ML), FHA removed the following from HUD Handbook 4000.1, FHA Single Family Housing Policy Handbook (Handbook 4000.1):

• The Economic Life/Section 223(e) (II.A.3.a.ii(I)) and renumbered subsequent sections to remove requirements for the underwriter to use the appraiser’s opinion of remaining economic life;
• Photograph requirements that exceed industry standards in Photograph, Exhibits, and Map Requirements (II.D.4.a);
• The remaining economic life reporting requirement in Effective Age (II.D.4.c.iii(D));
• The redundant requirement for additional comparable sales and listings in FHA Appraisal Requirements for Market Conditions and Changing Markets – Required Analysis and Reporting (II.D.4.c.iii(F)(3)); and
• Additional Appraisal Requirements for 223(e) Mortgages (II.D.8).

The provisions of this ML went into effect June 27, 2025.

Click to view the FHA Mortgagee Letter 2025-18: https://www.tenaco.com/wp-content/uploads/2025/07/FHA-Mortgagee-Letter-2025-18-06-27-25.pdf