Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
FHA inspection
I know we have ten days to schedule this, so we're doing this sometime within the next week.
I found this blurb online: "If the appraisal comes back and the house has some maintenance issues, they will need to be fixed before closing, or you may be disqualified for the FHA loan."
What sort of maintenance issues would disqualify an FHA loan? Would they have to be pretty serious maintenance issues? I am nervous about how picky they will be. The home we're under contract for is in really good shape but obviously I'm not an inspector so there are probably things they will find. I guess I'm curious as to what degree of severity the maintenance issue needs to be for them to disqualify the loan.
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Re: FHA inspection
That is helpful, thank you! Any information is helpful, really. We are so brand new at this.
Is an unattached garage considered in any of this? Or is it just livable spaces?
We bought a bank-owned with FHA, and they found several things that had to be fixed before closing: The door from the house to the garage needed to have an auto-close hinge (fire safety), the built in microwave needed to be working, and a few other things that I can't remember at the moment.
We looked at many houses during our search and the realtor would point out things that wouldn't pass FHA (additions, broken appliances, peeling paint, etc).
FHA is known for being very strict with inspections, but as with most things, it will really depend on your inspector. Some are more strict, and some are more relaxed. Be prepared for the worst....and be prepared to pay them to come out again to re-inspect, if anything needs to be fixed after the first inspection.
FHA inspections are very picky. The inspector will look for everything to be up to code and safe. No peeling paint, banisters on all stairwells, GFI outlets near water sources, no broken windows, functioning smoke detectors, etc. They'll inspect anything that is being financed...detatched garages too.
They'll do a regular inspection, but there will be additional items to inspect to meet the FHA regulations.
http://pandce.proboards.com/index.cgi#general
An inspection is NOT the same as an appraisal. There is no such thing as an FHA inspection. An inspection is not mandatory, although it is highly recommended. If you do choose to get an inspection, the inspector will not look at anything anything differently than he would for a conventional loan.
However, the appraisal must be done by an FHA appraiser who will make sure that it meets HUD guidelines. There are certain criteria the house must be in order to obtain FHA financing. There can't be peeling paint, missing flooring, missing handrails, electric, septic, and major items like siding and roofing must all meet the guidelines. The appraiser HAS to note in his report that it does/does not meet FHA guidelines, and that he is not an inspector.
For something like the garage being converted to the studio, he needs to make sure that proper permits were obtained. If so, it needs to be noted. If not, it might change your appraised value.
Also, you have ten days to get the inspection. Not ten days to get the appraisal. It is entirely possible that your house could pass an inspection, and then not meet the criteria for the FHA appraisal. I see a lot of posters get this confused on this board, so wanted to make sure that you understand inspection and appraisal are not the same.
Actually that's a really good point that I just learned today - it is an FHA *appraisal*, not inspection. The inspection that we order comes first, and then the FHA appraisal.
I emailed our realtor tonight to ask her about the permit issue. The sellers were honest about it on the disclosure and wrote down that no permit was pulled. Basically they added french doors, a skylight, and a loft and carpet to the garage. She emailed me back and her train of thought is because it is detached from the home it shouldn't be a problem but she told me she'd talk with her FHA contacts to see if there's any potential issue.
Basically because this is a short sale home, sold as is, the seller will do no repairs. So if it is determined that it has to be converted back to a garage in order to pass, we just can't do it. Hopefully it doesn't turn out like that. We love the house.
Edited by moderator.