Does FHA have any employment requirements that apply to staff of sponsored Third-Party Originators?

Sponsored Third-Party Originators involved in FHA loan transactions must comply with all applicable federal, state, and local licensing and other requirements governing their loan origination activities.

If the sponsored Third-Party Originator is also an FHA-approved lender, it is subject to FHA personnel requirements.

Additionally, an FHA-approved lender may not pay anything of value, directly or indirectly, in connection with any insured mortgage transaction or transactions to any person or entity if such person or entity has received any other consideration from the borrower, seller, builder, or any other person for services related to such transactions or related to the purchase or sale of the mortgaged property.  

For additional information, see Handbook 4000.1 I.A.5.a.v and I.A.3.c.iv(B)(3) available at: https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh and the Code of Federal Regulations at 24 CFR § 202.8 and 24 CFR § 202.5(l)  


All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.


Topic Number: KA-03033