FHA—Subdivision Site Suitability Requirement
Developers who expect to offer FHA-insured mortgage loans for homes in their proposed or newly-completed subdivisions must complete a Builder's Certification of Plans, Specifications, & Site disclosure statement. Some of the issues that might affect project viability are: toxic waste, flood, noise and earth movement. FHA classifies unstable land as "foreseeable hazards and adverse conditions."
FHA Landslide/ Soil Hazard Concerns:
(1) Does the site have any rock formations, high ground water levels, inadequate surface drainage, springs, sinkholes, etc.?
(2) Does the site have unstable soils (expansive, collapsible, or erodible)?
(3) Does the site have any excessive slopes?
(4) Does the site have any earth fill?