What is required of FHA borrowers before closing on a new mortgage loan?

The requirement for FHA borrowers before closing on a new mortgage loan primarily involves a property appraisal. This appraisal is essential as it determines the value of the property and ensures it meets the FHA's minimum property standards. The appraisal protects both the borrower and the lender by ensuring that the investment being made is sound and that the loan amount does not exceed the value of the property.

While a credit check is a standard part of the mortgage loan process, it is not specific to FHA loans, and the focus here is on the unique requirements linked to FHA lending. Similarly, a face-to-face meeting with a lender, while often beneficial, is not mandated specifically by FHA guidelines. Lastly, a loan payoff agreement pertains to the repayment of existing loans and is separate from the requirements for securing an FHA mortgage.

Overall, the appraisal process is a key step tailored to the FHA lending requirements, making it an integral part of closing on a new FHA mortgage loan.