According to HUD/FHA, the lender must obtain a written agreement between the borrower and the general contractor, or if there is no general contractor, for each contractor. The contractor must agree in writing to complete the work for the amount of the Cost Estimate and within the allotted time frame. The Agreement must include a provision for binding arbitration when construction disputes cannot be resolved by lender intercession.
REFERENCE: https://www.hud.gov/FHAFAQ
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