May 2, 2015
We have two questions today that are linked by a common answer. The first question:
“Isabela, PR (00662). what is HUD/FHA requirement regarding septic tank covered with grass. the complete back yard, including septic tank is covered. I am undergoing a HARP refinance…”
The answer to this question depends on what the state/local code requirements are for septic tanks.
FHA loan rules include a requirement that septic systems meet the approval of the local authority. If you contact the FHA directly by calling their toll-free number, you will learn that the FHA does not–and cannot–maintain archives of all state and local building codes across the United States. A borrower who needs information like this should contact the local authority to learn what the rules might be.
The second reader question:
“Re:HECM. Last time I checked my condo was in a building that didnt quite meet the owner-occupied standard. Has that changed? Is there any way to access the equity in my condo (Bought 10 yrs ago, $45,000)?”
It’s not quite clear whether the question refers to the FHA loan owner-occupier requirement for all single family FHA home loans or if the question refers to a condo project that is not “essentially residential” in nature according to HUD 4155.1. However, if the reader is asking whether the property in question has changed in its ability to be considered for an FHA home loan, that’s a question best left to a lender who may or may not need to have the condo project added to the FHA approved list.
FHA home loans for new purchases, HECM, or cash out refinancing would require the owner to occupy the property as the principal residence.
These two questions and others like them may require the applicant to do some research on local requirements or to talk to a lender to see what may be possible in the specific situation. FHA loan rules do establish minimum standards and guidelines, but these standards can be supplemented by more strict requirements at the local or state level. Lender standards may also play a role in some transactions depending on the nature of the issue.
Do you have questions about FHA home loans? Ask us in the comments section. All comments and questions are held for review before being posted to the website.
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.
Browse by Date: