From Mortgagee Letter 2005-48:
FHA no longer mandates automatic inspections for the following items and/or
conditions in existing properties:
* Wood Destroying Insects/Organisms: inspection required only if evidence of
active infestation, mandated by the state or local jurisdiction, if customary to
area, or at lender's discretion
* Well (individual water system): test or inspection required if mandated by
state or local jurisdiction; if there is knowledge that well water may be
contaminated; when the water supply relies upon a water purification system
due to presence of contaminants; or when there is evidence of:
Corrosion of pipes (plumbing)
Areas of intensive agriculture within 1/4 mile
Coal mining or gas drilling operations within 1/4 mile
Dump, junkyard, landfill, factory, gas station, or dry cleaning operation within
1/4 mile
Unusually objectionable taste, smell or appearance of well water
(superceding the guidance in Mortgagee Letter 95-34 that requires well
water testing in the absence of local or state regulations)
* Septic: test or inspection required only if evidence of system failure, if
mandated by state or local jurisdiction, if customary to the area, or at
lender's discretion
* Flat and/or unobservable roof
(Emphasis added.)
So, a flat roof doesn't require an automatic inspection. It's up to the appraiser to recommend one if conditions warrant and up to the DEU to decide.
