FHA Loan Termite Inspection: When HUD Requires One

An FHA loan does not require a termite inspection on every home. On an existing home, an inspection becomes required when the appraiser sees evidence of infestation, or is told of one or of a prior treatment, and makes the appraisal subject to a pest inspection.

The rule is in HUD’s own handbook, and the answer for your file is on your appraisal. For what an inspector checks on any purchase, see my overview of a termite inspection for home buyers.

Does an FHA loan require a termite inspection?

An FHA loan does not automatically require a termite inspection for every existing home, but the Federal Housing Administration requires your lender to confirm the house is free of wood destroying insects and organisms.

This requirement sits directly inside HUD Handbook 4000.1, the official rulebook for FHA loans issued by the US Department of Housing and Urban Development. Section II.A.3.a.ii states, “For existing Properties, the Mortgagee must confirm that the Property is free of wood destroying insects and organisms.” In FHA paperwork, “Mortgagee” simply means your mortgage lender.

The same section of the handbook establishes when a professional pest inspection must be ordered: “If the appraisal is made subject to inspection by a qualified pest control specialist, the Mortgagee must obtain such inspection and evidence of any required treatment to confirm the Property is free of wood destroying insects and organisms.”

Under section II.B.4, HUD applies this exact same requirement to Home Equity Conversion Mortgages, which are FHA reverse mortgages. Unless an appraiser flags a concern or local rules intervene, an existing home does not get an automatic inspection mandate from HUD.

What makes the appraiser call for one?

An appraiser calls for an inspection when they spot physical signs of wood-destroying pests or when someone informs them of an active or past infestation.

HUD Handbook 4000.1, section II.D.3.m.iii directs the appraiser to look over the home during their visit. The handbook says, “The Appraiser must observe the foundation and perimeter of the buildings for evidence of wood destroying pests. The Appraiser’s observation is not required to be at the same level as a qualified pest control specialist.”

If the appraiser spots mud tubes, the dirt tunnels termites build to travel across exposed concrete, or is told of an infestation or a past treatment, the file changes. The handbook states that “If there is evidence or notification of infestation, including a prior treatment, the Appraiser must mark the evidence of infestation box in the “Improvements” section of the appraisal and make the appraisal subject to inspection by a qualified pest control specialist.”

That single phrase, “including a prior treatment”, carries significant weight for home buyers. If a seller discloses that the home was treated for subterranean termites five years ago, that notification forces the appraiser to require a fresh inspection, even if the building looks completely clear today.

Appraisers cannot call for pest reports arbitrarily. Section II.D.3.a.iv specifies that “Appraisers may not recommend inspections only as a means of limiting liability. The reason or indication of a particular problem must be given when requiring an inspection.” Look at the Improvements section of your appraisal report. If the pest box is checked, read the specific explanation written right next to it, because that note determines what your lender needs to see.

What does the lender need in the file?

Your lender needs a formal inspection report from a licensed pest control professional confirming that the home shows no evidence of unaddressed wood-destroying organisms.

When your mortgage file goes through its pre-endorsement review, the lender’s final file audit before closing, HUD section II.A.7.b.xvii requires them to check the paperwork. The handbook states that “The Mortgagee must confirm that the file contains the National Pest Management Association (NPMA) form NPMA-33, Wood Destroying Insect Inspection Report, or the state mandated infestation report, as applicable.” You can review my breakdown of form NPMA-33 to see what each section of that document covers.

The NPMA-33 form itself states right at the top that “This form is approved for FHA and VA loans.” If you are managing tight closing timelines, you can check my guide on how long a termite letter stays valid to see how long your lender will accept an issued report.

Which form counts in my state?

The form that counts in your state depends on whether your state government mandates its own official wood-destroying insect paperwork.

The NPMA-33 is widely used, but some states prescribe their own form for real estate transactions. For example, the California Structural Pest Control Board states that form 43M-41 supersedes the NPMA-33 in California as the official report for wood-destroying pests. In Texas, the Structural Pest Control Service says Rule 7.176 requires its department prescribed form, the SPCS/T-5, for real estate transactions.

If an inspector completes an NPMA-33 in a state that requires its own document, your lender’s underwriting department will reject the file. Check my list of state termite report requirements to confirm which official form your state requires.

What happens if the inspector finds termites?

If the inspector finds live termites or evidence of active infestation, the pests must be treated and any structural damage evaluated before the mortgage can close.

Because your lender must verify that the property is clear of wood-destroying organisms, a positive finding pauses the loan until treatment occurs and the inspector issues a clear follow-up report. However, HUD restricts how technicians apply chemicals on FHA properties. HUD Handbook 4000.1, section II.A.3.a.ii states that “Soil poisoning is an unacceptable method for treating termites unless the Mortgagee obtains satisfactory assurance that the treatment will not endanger the quality of the water supply.”

If termites have damaged structural framing members like floor joists or rafters, treating the insects is only the first step. In my view, damage that the appraiser or inspector considers a threat to the safety or structural soundness of the home becomes an obligatory repair issue that must be resolved prior to closing. If your property report turns up active pests or damage, read my guide on what happens after a failed termite inspection and learn how to navigate negotiating termite repairs with the seller.

What about a newly built house?

New construction homes operate under a completely different set of FHA termite rules focused on builder guarantees and preventive treatments rather than appraiser observations.

HUD Handbook 4000.1, section II.A.8 mandates form HUD-NPMA-99-A, the Subterranean Termite Protection Builder’s Guarantee, for all newly constructed homes. The only exception occurs if the property sits in a county listed as exempt on HUD’s Termite Treatment Exception Areas list. If a new home is built entirely of steel, masonry, or concrete with only minor interior wood trim and roof sheathing, no chemical treatment is required, and the builder simply notes that construction method directly on the form.

When a newly built house is treated with a soil termiticide, a field applied wood treatment, a bait system, or a physical barrier, the builder must also supply form HUD-NPMA-99-B, the New Construction Subterranean Termite Service Record. The builder’s guarantee is a HUD form, not a termite bond with a pest control company.

HUD also limits how builders apply protective chemicals after construction finishes. The handbook explicitly mandates that “The Mortgagee must reject the use of post construction soil treatment when the termiticide is applied only around the perimeter of the foundation.”

House Type	Primary FHA Requirement	Trigger Mechanism	Key Paperwork
Existing Home	Inspection only if the appraisal is made subject to one	Appraiser observation or past treatment notice	Form NPMA-33 or State Form
New Construction	Builder’s guarantee	Required unless the county is on HUD’s exception list	Form HUD-NPMA-99-A & HUD-NPMA-99-B

Is FHA different from VA here?

FHA ties its inspection requirement to specific observations made on an individual home, whereas the Department of Veterans Affairs ties its requirement directly to regional geographic location maps.

Under VA Circular 26-22-11, the VA requires a wood-destroying pest report as a Minimum Property Requirement for certain properties in areas where the Termite Infestation Probability Map puts the probability at “very heavy” or “moderate to heavy.” The same circular authorizes veterans to be charged the inspection fee where the Notice of Value requires the report.

FHA does not rely on a regional probability map for existing homes. Under HUD’s text, an existing home in a high-risk southern state needs an inspection only when the appraiser sees evidence, or is told of an infestation or a prior treatment. A home in a low-risk northern state needs one on the same trigger. You can review the complete details of the VA rules in my guide to the VA loan termite inspection.

Who pays for it?

The termite passages in HUD Handbook 4000.1 do not dictate whether the buyer or the seller must pay for the termite inspection or any subsequent extermination costs.

Because those passages are silent on payment, the purchase contract between the buyer and seller decides who pays for the inspection fee and any needed treatments. You can explore typical real estate customs in my breakdown on who pays for a termite inspection.

When booking an inspection to satisfy a lender requirement, state licensing is crucial. The US Environmental Protection Agency notes that firms offering termite services must be licensed by your state, and homeowners should ask to see a company’s license before hiring them.

If you need a few days to select an inspector, you do not need to panic about rushing into a contract. The University of Kentucky Department of Entomology notes that termites damage wood slowly, so the damage from taking an extra day or week to choose a company is generally inconsequential. To make sure you pick a qualified inspector, read my guide on how to vet a pest control company.

How you should handle your FHA inspection

My recommendation for handling an FHA termite inspection comes down to four practical steps, though keep in mind I have not seen your specific appraisal report or mortgage loan file.

First, examine your appraisal report the moment your lender releases it. Look directly at the Improvements section to see if the appraiser marked the pest infestation box, and read the written explanation carefully to see what triggered the requirement.

Second, disclose any past termite treatments to your lender and appraiser early in the transaction. Because HUD requires an inspection whenever there is notification of a prior treatment, a treatment that surfaces late in the file can delay closing.

Third, hire an inspector who holds an active state license and uses your state’s approved paperwork. You can schedule a professional inspection with a verified local operator through my wood-destroying insect inspection directory.

Fourth, negotiate payment responsibilities directly inside your purchase contract before ordering the report. Establishing upfront whether the buyer or seller pays for required extermination or repairs prevents sudden financial disputes right before closing.

Sources

• Handbook 4000.1, FHA Single Family Housing Policy Handbook (Update 18, redline copy) — US Department of Housing and Urban Development, 2026-08-12. Accessed 2026-10-01.
• Form NPMA-33: Wood Destroying Insect Inspection Report (7/01/19) — National Pest Management Association, hosted by US Department of Housing and Urban Development, 2019-07-01. Accessed 2026-10-01.
• Frequently Asked Questions Regarding the Use of the National Pest Management Association’s Wood Destroying Insect Inspection Form (NPMA-33) in California — California Structural Pest Control Board, undated. Accessed 2026-10-01.
• Texas Official Wood Destroying Insect Report, Form SPCS/T-5 (Rev. 9/1/2020) — Texas Department of Agriculture, Structural Pest Control Service, 2020-09-01. Accessed 2026-10-01.
• Circular 26-22-11: Pest Inspection Fees and Repair Costs — Veterans Benefits Administration, US Department of Veterans Affairs, 2022-06-15. Accessed 2026-10-01.
• Termites: How to Identify and Control Them — US Environmental Protection Agency, 2025-10-21. Accessed 2026-10-01.
• Termite Control: Answers for Homeowners (ENTFACT-604) — University of Kentucky Department of Entomology — Michael F. Potter, 2026-03. Accessed 2026-10-01.