Let’s take a minute to dispel some of the rumors surrounding the FHA appraisal. The FHA program is a government insured mortgage that a great program for home buyers by allowing for low down payments and less than prefect credit. However, sometimes due to some bad information in the real estate community, this program often receives a reputation for being overbearing and difficult. Let us be clear, this could not be further from the truth!
One of the most common myths about a FHA mortgage is that the appraisal requirements are difficult to pass. While the standard FHA program does have a general expectation that homes be relatively move-in ready (no doubt this is because the program is low down payment loan for most applicants), this is not a difficult process for most homes. Here is a quick guide on the general parameter’s a FHA appraiser is looking for during his/ her inspection:
-Utilities (power and water) must be on and functioning
-Exposed/ faulty wiring
-Peeling paint for homes built prior to 1978
-Bars on windows (or anything else blocking the windows)
-Water damage/ rotted wood
-Non-operational swimming pools (murky/ green water)
-Attic needs to be insulated and the appraiser will need access to inspect
Most of all, the FHA appraisal is meant to address the 3 S’s. Per the U.S. Department of Housing and Urban Development, this refers to:
Safety: The home should protect the health and safety of the occupants.
Security: The home should protect the security of the property (as collateral for the mortgage loan)
Soundness: The property should not have any physical deficiencies or conditions affecting its structural integrity.
If these general parameters are meet, a home could be a candidate for FHA financing. Please keep in mind that this is not an all-inclusive list, but more of a guideline to help with the understanding of the FHA appraisal process. If you would like to discuss a particular FHA appraisal situation, or would like a second option; feel free to send an email or call to speak to one of our Loan Officers.
Branch Manager; SunPoint Home Loans
NMLS 410530; Company NMLS 1788