If you’re buying a home, you probably want to move in as soon as possible. However, you also have every right to expect that the house will be safe and move-in ready.
Some people might want to move in and make the repairs later, but with an FHA loan, many repairs must be completed prior to closing. While this may seem inconvenient, it ensures that your house will be more like a home than a construction site on moving day. In fact, if your house doesn’t meet the basic safety standards outlined below, you won’t be allowed to close on your loan.
Here are some of the things that appraisers are on the lookout for.
Common Repair Items
Exposed Floorboards and Wall Studs: These indicate unfinished construction and could potentially make the house unsafe. Construction must be completed prior to closing.
Chipped or Peeling Paint: Due to the potential for lead-based paint, if the home was built prior to 1978, the FHA requires that all areas of chipping, peeling or otherwise defective paint be scraped and painted and the chips disposed of properly.
Water Damage: Visible water damage can be an indicator of roof damage, plumbing problems or foundation issues. Areas that have water damage are also at risk of developing mold. All roof, plumbing, foundation and mold issues must be remedied prior to closing on the home.
Major Renovations: The appraiser must determine the value of the finished product, so major renovations, which can take months, must be completed prior to close.
Holes in the Roof or Siding: Damage to the roof or siding can lead to water infiltration that can harm the home in other ways in the long run. The FHA requires that such issues be repaired.
Driveway or Sidewalk Damage and Missing Handrails: Poorly maintained sidewalks and driveways and missing handrails are considered safety hazards by the FHA and must be corrected.
Other Potential Appraisal Issues
In addition to correcting structural deficiencies, there are a couple other basic appraisal guidelines that the seller will need to follow in order to avoid delays:
- All utilities must be turned on
- All rooms and areas must be accessible, including the attic, crawl space and detached structures
Additional structures on the property will be held to the same standards as the house.
Getting the Fix
If you find out that something needs to be fixed before you can close, the repair cost can be paid either by you or by the seller. If you end up paying for the repairs as a buyer, you may be able to get the seller to offset the cost by lowering the price of the house. If you pay for the repairs, you need to make sure you have enough money left over to close.
Any repairs that the seller agrees to complete as part of the purchase agreement must be finished before the loan can close.
Check out our FHA page for more information on these loans. Do you have any additional questions about property conditions? Let us know in the comments.
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