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? Association water

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Cres Ann Hoyt

Sophomore Member
Joined
Feb 11, 2004
Professional Status
Certified Residential Appraiser
State
New Jersey
I did an appraisal in a lake community where the subject is hooked up to the association water, not an individual well. Lender wants to know if this meets HUD guidelines. I've been looking through the guidelines and can't seem to find the answer when it pertains to association water supply. Anyone ever deal with this?
 

RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
I am not aware of any guidelines for association water supplies. Does the association maintain the water system? Is there a fee specificly for the water system or is it paid in the normal HOA? If it is an approved system, then I don't see why it would not meet HUD/FHA guidelines.
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
9. How would shared well agreements be treated?
[FONT=Times New Roman,Times New Roman]Wells shared by up to four properties are acceptable provided that there is an acceptable legal agreement between the property owners, the quality of the water is found acceptable, there is sufficient capacity, and it is in accordance with local well codes. A shared well must have a shared well agreement and shall be binding upon signatory parties and their successors in title[/FONT][FONT=Times New Roman,Times New Roman].
[/FONT]
 

Mike Boyd

Elite Member
Joined
Jan 18, 2002
Professional Status
Retired Appraiser
State
California
An "association" water system is usually a Mutual Water Company. Mutuals must have FHA approval to be acceptable. In the past, lists of approved Mutuals were available for each county. Mutuals can LOSE FHA approval if they exceed their capacity or if there is a water quality problem. You should know the difference between a public utility and a mutual water company. In CA, private water companies must meet certain guidelines and when approved, are properly identified as a public utility.
 

RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Mike, that is some interesting information. Do you have a source for that?
 

timd354

Elite Member
Joined
Jan 11, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
The easiest way to find out the status of the association's water system up is to call the loacl health department or water and sewer commision or whoever it is that regulates water systems in your jurisdiction. Also, try calling the HOA, they may be able to provide the doumentation and information needed.
 

Caterina Platt

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
New Mexico
Went thru the Public vs. Community battle a few months ago

We have a community system here that WF was adamant was public. In my research for HUD's definitions I found these documents from the 4075.12 Handbook, Chapter 2.

The information as to whether the system is HUD approved or not needs to come from the administrator of the water system. This is the lender's responsibility, but what I end up doing is putting the name of the system and the contact number in the report.
 

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