March 10, 2015
A reader asks, “FHA mortgages, at one time,required the properties to meet stringent guidelines for habitability; (ie)roof, heating and other standards were the seller’s responsibilities, before escrow closed…. Are these parameters no longer an issue? Can a government secured loan be approved without these conditions being met?”
FHA loan rules still require an appraisal of any home to be purchased with a new purchase single family FHA mortgage and certain types of FHA refinancing. The FHA appraisal is required to establish the fair market value of the property and to make sure the home meets basic FHA minimum property requirements.
FHA appraisals should not, however, be misconstrued as a seal of approval from the FHA. Just because a home passes the FHA appraisal process with few or no required corrections does not insure the home is free from defects.
A borrower should always pay for the optional but strongly recommended home inspection performed by a licensed professional.
A home inspection is a far more in-depth look at the property than an appraisal. An FHA appraiser is not required to walk out onto the roof, for example, where a home inspection would give you detailed information about the state of the roof and other aspects of the home.
Your FHA appraiser is not an expert in all areas of the property. He or she may spot glaring issues that don’t comply with FHA minimum standards or state/local building code, but a licensed home inspector will see your potential home in a more more detailed way.
Borrowers who need more information on the appraisal or home inspection process should talk to a loan officer, a real estate agent or contact the FHA directly by calling 1-800 CALL FHA.
Do you have questions about FHA home loans? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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