The servicer must ensure that a thorough property inspection is completed before it decides to liquidate the mortgage loan by initiating foreclosure.
When foreclosure proceedings are initiated, the servicer must ensure that a property inspection is completed within 35 days prior to foreclosure sale for
all conventional mortgage loans,
any FHA mortgage loan that cannot be conveyed to FHA,
all VA mortgage loans for which VA would not establish an “upset price,” and
any special servicing option RD mortgage loan.
See D2-2-10, Requirements for Performing Property Inspections for requirements when a property inspection is needed and A4-2.1-02, Property Inspection Vendor Management and Oversight for additional requirements for property inspection vendors. The servicer must also follow the procedures in Requesting Reimbursement for Property Inspections and Property Preservation Expenses in F-1-05, Expense Reimbursement to submit for reimbursement of associated expenses.
The following table provides references to Announcements that are related to this topic.