FHA ?

[larryhaskell]

I have an FHA ? but I'm posting it here because there is a sense of urgency on the part the lender, etc., etc., etc. I inspected a house that has a non-permitted garage conversion to a second living unit. It is highly unlikely that a permit would have been given per the local zoning authority. I have talked to an underwriter about this issue and she faxed me a page of what looks like a HUD document discussing non-permitted structures. She highlighted the part that addresses patios and slabs for sheds but ignored the part about converted garages to additional living areas and that if this is not a legal use HUD won't insure the property. I have searched through 4150.2 on All Regs but didn't find this particular page. Can anyone direct me to the appropriate document where non-permitted structures is located? I did a search on All Regs in the FHA section for non-permitted structures and had no hits. Thanks in advance for any help.

 

[mbrunson]

If by a "second living unit" you mean that the single family home has been converted to a multiple-family dwelling, then the real question is not about permits. The question HUD really cares about is legal use. Does the current zoning allow for a two unit property. If not, then this property is not FHA insurable.

Don't get confused about the issue. When HUD talks about "legal use" they are asking if the addition/conversion is allowable under current zoning. They are not asking you to find out if the addition/conversion is permitted.

Call your local HOC for any clarification.

If the area in question is actually just a garage converted to livable area, simply provide one or two comps with similar garage conversions and demonstrate the market acceptance of garage conversions.


SDG

Mike

 

[Mike Garrett RAA]

Non conforming use. Was it grandfathered? Is it the Highest and Best Use? Is it legal? If the answer is no...then the loan won't fly. Call the HOC for clearification, if necessary. Don't rely on the lender.