FHA refinance with a new unfinished addition

[psappraisals]

The borrowers are in process of adding an addition. It is currently sealed off from main dwelling. Exterior is finished, interior is currently blueboarded only with rough electrical, plumbing etc. Client wants me to do appraisal "as is". I am new a FHA appraisals, Am I able to do appraisal on main dwelling only and give no value to addition or do I need to have addition totally completed? According to the client the borrower needs money from refi to finish addition. Thanks for your help.

 

[Greg Bell]

What is sealed off???If access is possible then safety concerns would apply.Is addition permitted as livable area???Once an addition is started usually it must be completed before FHA mortgage insurance is issued.Looks like "Subject to MPR" to me..

 

[psappraisals]

Where the access way to main house will be is currently sealed over with plywood so no access is currently permitted. The addition will be living area when finished a family room and bathroom. The only access to addition is currently via exterior doors.

 

[CANative]

Other Health and Safety Deficiencies
Address all health and safety issues, physical deficiencies or adverse conditions that affect the livability, soundness or structural integrity of the property. The nature and degree of any health and/or safety issues will determine whether to address said deficiency in the narrative comments area of the report under “condition of the property”, or “physical deficiencies” affecting livability or structural soundness.

You will have to make the call.

 

[ghrousseau]

I doubt it will fly with any investor in this market. I know none of the investors we work with will take it as a FHA product. This loan should be really structured as a 203K which shouldn't be that difficult if the current owner has applied for permits and done everything legal.