Announcement 2026-063 FHA Waiver to Well Water Distance Requirements for Existing Construction

FHA Waiver to Well Water Distance Requirements for Existing Construction

Newrez LLC "Newrez" Approved Correspondent Clients, The Federal Housing Administration (FHA) announced that it has issued a broad waiver to the well distance requirements for Individual Water Supply Systems, which are part of FHA’s Minimum Property Requirements (MPR) for Existing Construction set forth in Single Family Housing Policy Handbook 4000.1. 

Announced July 27, 2026 and effective immediately in FHA INFO 2026-17.

With this waiver, FHA is streamlining its well water distance requirements.

FHA’s well water distance requirements do not universally align with those of many local jurisdictions where local authorities have officially deemed lesser distances safe, compliant with local codes, and acceptable for residential use other than those found in the FHA Handbook 4000.1.
 
This waiver applies only to existing construction when:

• the property meets the distance requirements of the local jurisdiction*; and

• acceptable water testing results are documented by the mortgagee.

*The local jurisdiction refers to the local health authority, environmental agency, or governing municipality who has inspected, permitted, or grandfathered the private water system in its current configuration.

This waiver is effective immediately and does not apply to FHA's minimum property standards (MPS) for new construction, which is covered under separate regulations.
 
This memo is issued as interim guidance to address FHA Info 2026-17 ahead of a forthcoming update to HUD Handbook 4000.1. Until HUD publishes the revised handbook language, the guidance outlined above should be followed for all applicable loans.