November 2, 2015
We get many reader questions about the FHA appraisal process that include the phrase “FHA inspection”.
But there is no such thing as an FHA “inspection”, there is only an appraisal designed to make sure the property to be purchased with an FHA loan meets minimum standards and establish the fair market value of that property.
It’s a mistake to assume that a home that “passes” an FHA appraisal is free from problems or defects. The FHA appraisal is never intended to be a stamp of approval on the home or a guarantee of any kind. That is why the FHA and HUD urge borrowers to pay for the optional but extremely important home inspection as well as the appraisal.
The home inspection is something the borrower must schedule and pay for on his or her own–the lender and the FHA are not involved at all in this process.
The inspection is essentially a way for the borrower to insure the home being purchased goes much farther than simply meeting FHA minimum standards.
Home inspections are carried out by trained, qualified professionals that you can find in your local area. The home inspector will examine the roof, the basement, the mechanical systems in the home and many other things and give you a determination as to the current condition of the property.
Borrowers who buy a home relying on the FHA appraisal alone are really making a purchase without being fully informed about what they are buying. In the same way you should never purchase a vehicle without a test drive, you should never buy a home without an inspection.
Do you work in residential real estate? You should know about the free tool offered by FHA.com. Designed especially for real estate websites, this is a widget that displays FHA loan limits for the counties serviced by those websites. It is very easy to spend a few seconds customizing the state, counties, and widget size for the tool; you can copy the code and paste it into your website with ease. Get yours today:
http://www.fha.com/fha_loan_limits_widget
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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