Can an FHA-approved Mortgagee use non-employees as Loan Officers?

No. The Mortgagee may use contract support for administrative, human resources, and clerical functions that include:

  • clerical assistance;
  • mortgage processing (typing of mortgage documents, mailing and collecting verification forms, ordering credit reports, and/or preparing for endorsement and shipping mortgages to the Purchasing Mortgagee);
  • ministerial tasks in mortgage servicing (processing of a foreclosure action, preservation and protection, and/or tax services);
  • legal functions;
  • Third Party Verification Services (TPV);
  • Quality Control; and
  • human resources services (payroll processing, payment of employment taxes and the provision of employee benefits) provided by a professional employer organization or a similar entity.  

For additional information see:
Handbook 4000.1 Section I.A.6.j at

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-05121