When an FHA loan applicant wants to buy a home with an FHA-insured mortgage, the property must be appraised and an FHA-approved appraiser, who reviews the home to make sure it meets FHA standards.
Depending on where the home is located, FHA loan rules or local ordinances may require pest control treatments on the property. The appraiser may also require them if evidence of termites or other insects is evident at appraisal time.
The FHA rules for termite treatment are spelled out at FHAOutreach.gov. Those rules include guidance on the particular types of treatment, references, and guidelines on reporting and licensing requirements for pest control agencies used to treat a property to be purchased with an FHA mortgage.
For new construction properties in “termite prone areas,” FHA rules say “acceptable treatment methods for protection include chemical soil treatment, pressure preservative treated wood, naturally termite resistant wood or physical barriers (such as metal or plastic termite shields), bait systems, or any combination of these methods.”
The FHA also has requirements for existing construction properties. “Generally the treatment method will be as recommended on the inspection report.” But FHA rules make it clear that some types of termite treatments are not acceptable under some circumstances. “Where the home uses an individual water supply system, soil poisoning is an unacceptable treatment method unless satisfactory assurance is provided that the construction and location of the water supply system meets the specific requirements of 24 CFR Part 200.926d.”
FHA rules go on to say chemical treatments and bait systems “must be approved by the Environmental Protection Agency (EPA) and applied in accordance with the EPA label instructions.” As with many such requirements, FHA regulations, local code and federal law, where applicable, all apply in such situations because of complex issues regarding health and safety.
Some homes may never need or require termite control treatments. Others are located in areas well-known for their termite issues and as such are required to have the treatment performed and documented as a condition of getting an FHA loan approved.