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FHA - public utilities cost to hook up

Discussion in 'FHA/HUD and VA' started by Kevin Thompson, Apr 17, 2009.

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  1. Kevin Thompson

    Kevin Thompson New Member

    0
    Apr 25, 2004
    Professional Status:
    Licensed Appraiser
    State:
    Minnesota
    Are FHA appraisers required to determine if city water and sewer are available when the subject is on a septic and well?
     
  2. Vegan702

    Vegan702 Senior Member

    0
    Feb 24, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Nevada
  3. Kevin Thompson

    Kevin Thompson New Member

    0
    Apr 25, 2004
    Professional Status:
    Licensed Appraiser
    State:
    Minnesota
    Thanks, found it in the manual. Silly me.
     
  4. h2obio

    h2obio New Member

    0
    May 30, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    I ran into this recently and argued unsuccessfully.......basically, they want to know if it's "feasible". So, considering the sewer hookup was several miles away, it didn't appear feasible....... the county planner wouldn't stand up and make that statement, so I was forced to......good luck!
     
  5. kevingrehan

    kevingrehan Junior Member

    0
    Feb 20, 2009
    Professional Status:
    Certified Residential Appraiser
    State:
    Mississippi
    Underwriter to decide. How the heck do you know how much it cost to run plumbing to a subject. Unless you are a plumber. I'm waiting for someone to tell me where a drain field is!
     
  6. timd354

    timd354 Elite Member

    109
    Jan 11, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Maryland
    What are you talking about? If the water and sewer is not available at the property line (usually in the street or an alley), then it is simply not feasible to hook up unless the property owner has the ability to run water and sewer across public property and or neghboring private properties (which obviously is not the case).
     
  7. Lloyd Bonafide

    Lloyd Bonafide Senior Member

    0
    Jan 15, 2006
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Exactly right. If they are at the street, then the underwriter might have something to think about. But it can cost a small fortune just to get permits, and get the sewer or water hooked up from in front of your house. And if the property owner has a septic system that works, then in my mind it is not economically feasible to hook up to a public sewer, especially in a high-cost permit area where it might cost the property owner $20,000 or more for the permit plus the actual cost of the work.
     
  8. Tom Woolford

    Tom Woolford Elite Member

    84
    Nov 20, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Someone probably will correct me, but I believe the threshold is if the cost is 3% of MV or less to complete the hookup. That said, Most lenders are not going to wait while bids are made to get that figure. It does happen. I had a home that had sewer available on the street, but the house was built before it was installed and was on septic. Cost to connect was much less than the 3%.
     
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  9. h2obio

    h2obio New Member

    0
    May 30, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    I believe that Tom is correct about the 3%. It comes down to whether you are willing to state that it's "feasible" or not.........in most cases it's not, but if the utilities are at the street it may be feasible.......in my case the UW wouldn't back down and the utilities were several miles away, so I was forced to make the statement that it was not feasible--after arguing for two weeks.........
     
  10. Mike Boyd

    Mike Boyd Elite Member

    0
    Jan 18, 2002
    Professional Status:
    Retired Appraiser
    State:
    California
    Then, it is not feasible, is it? What's the problem?

    Marshall & Swift has cost estimates to run water and sewer lines. Typically, there are also water and sewer HOOK-UP FEES in addition to the actual cost of extending the main lines.

    Furthermore, the subject may not be in a district that allows public funding or the use of the public facilities. It may have to first be ANNEXED into a district. Typically, if water and sewer is NOT in the street, it is not feasible.
     
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