Unpermitted Additions

[Terraform]

Is this an immediate dis-qualifier for FHA loans?

 

[Blueprint]

It is not a disqualifier, though FHA will not loan on the unpermitted addition itself, whether it is perceived as GLA in the market or not. If there is gas going to the unpermitted addition, it will have to be capped off(allowing no gas to the entire property).

 

[Randolph Kinney]

Call the HOC and ask them.

However, you can't ignore what is there. You must analyze and report what is there and whether it should be considered as GLA and the market reaction to it.

You can show it as a separate line item on the grid and the value the market reflects (positive, negative or zero). Does it impair its marketability? Does it have a permanent heat source? Does it match the design, appeal, and quality of construction of the main dwelling? What is the policy on the local controlling authority for enforcing their permits or issuing reactive permits?

FHA is not the lender. The lender may want you to exclude any positive value contribution as an assignment condition. In any case, you must report and analyze what is there and its impact on value and marketability.

 

[CANative]

What the hell? Blueprint... that's not accurate.

When you say "unpermitted addition" do you mean an illegal use? Or do you mean a legal use that requires a permit and they didn't get one?

If it's the former then the property is not eligible. If it's the latter then FHA states:

3-5 CODE ENFORCEMENT FOR EXISTING PROPERTIES
Local municipalities design local housing code standards;
therefore, enforcement of such housing standards rests with the
local authority. HUD does not have the authority or the
responsibility for enforcing local housing codes except for
mortgages on properties to be insured under Section 221(d)(2)-a
program with mortgage limits at $36,000. Loans insured under
Section 221(d)(2) of the National Housing Act require code
enforcement. The appraiser should contact the lender for further
instructions if the mortgage is to be insured under Section
221(d)(2).

 

[Mike Kennedy]

Is this an immediate dis-qualifier for FHA loans?

"FHA Valuation Protocol FAQ Revised 1/24/13

Pg 9

"Does the appraiser determine what inspections are required or does the lender determine that?
Mortgagee Letter 2005-48 provides examples of property conditions that will continue to require automatic inspections.
The appraiser should note what
inspections, if any, are customary for the area, required by state or local law, or that are recommended based on observed property conditions.
Lenders must review the appraisal to determine whether the appraiser has
reported any property conditions that affect the health and safety of the
occupants, or the security and the soundness of the property, and must require Immediate repair or inspection where the property condition poses a threat to these criteria."

 

[CANative]

Off topic Mike.

 

[Ms. Janet]

Off topic Mike.

I think it may be illegal to use your copy and paste machine if you don't know "what municipality"

I'm calling citizens arrest

 

[CANative]

 

[JamesRockford]

............................

 

[Trout]

Highest and Best Use.

Legally permissible???