Have questions...

[Dreamhouse2020]

My mom me and our family are trying to buy a property that we all feel is our dream home. It is a foreclosure and had some issues in one of two detached garages on the property. It sat empty for close to three years when we fell in love with it. We wrote our contract and thr bank accepted our offer. Then our financing changed from Conventional to FHA. We took it upon ourselfs to repairs 5 holes in the roof of one of the garages/ workshop. We changed outlets to GFCIs and washed walls, cleaned closets, and cleaned the yard. Three whole days of non stop work. The house itself is in good condition and should not have any fixes needed from appraisal. The appraisal is tomorrow and im concerned that the damage inside from where the holes were, will need to be repaired before close. There's plywood that is wet from rain and snow coming through the roof holes. I guess my question is...will the appraiser require those pieces of plywood be removed before close? Or..will he say since the holes are repaired, and no rain or snow can get in, we can fix the inside after closing??
Thanks in advance for thr help!

 

[Overimprovement]

Honestly it depends on the appraiser. There are some gray areas in how the FHA handbook is interpreted. Basically, we observe, we do not inspect. An FHA appraiser should note whatever damage that exists, but is not required (and usually not qualified) to determine the cause. The lender is really the one who determines if the loan meets their guidelines for submission. An appraiser will never say a home doesn't qualify for an FHA loan, only that certain conditions exist that may not meet minimum guidelines.

An inspection may be recommended, depending upon the severity of the noted and observed conditions during their inspection (observation). Worse case scenario is an inspection shows no further issues or x and y need repaired, and once done, the loan continues forward. Its never a dead stop, unless there is some external factor like oil bubbling up 5' from the property line.

Good luck!

 

[GWISC]

Worst case scenario, is that the lender calls for specific repairs the appraiser has noted in their report. Rather than trying to guess what the appraiser is going to report, just wait for the report. Generally, most repairs are minor; ie scrape and paint areas showing defective paint surfaces, add a handrail to a set of stairs, remove debris from site, add dirt around the foundation for better drainage etc... If your house is as you describe, and only has a few areas of damp drywall, then that sounds to me to be a relatively easy fix (if required). Well, it would be an easier fix than say gutting an interior due to excessive mold or other issues.

My suggestion is to wait for the appraisal report. You could also request that you would like to meet the appraiser during the time of the inspection so that you can get a better idea as to what the appraiser is looking for. It could be beneficial to you and you may learn of other items about your house you may not have known about.

I see your in Illinois. All I can say as a Wisconsinite is "Go Badgers!!". I just had to get in one jab.

Good luck!!

 

[Ariba]

We took it upon ourselfs to repairs 5 holes in the roof of one of the garages/ workshop. We changed outlets to GFCIs and washed walls, cleaned closets, and cleaned the yard. Three whole days of non stop work.

I call that trespassing.

 

[GWISC]

Ariba, I am sure they had permission to access the property from the REO lender. I myself would wait until the report comes out to avoid doing unnecessary work, especially spending money on a house that you don't yet have title to.

 

[Ariba]

Ariba, I am sure they had permission to access the property from the REO lender. I myself would wait until the report comes out to avoid doing unnecessary work, especially spending money on a house that you don't yet have title to.

There is no lender in the world that would give potential buyers access to the property let alone permission to work and/or make repairs on a property. If not just for the liability.

 

[Ariba]

duplicate post

 

[TMG]

FHA = the three S's: Safety, Security, Soundness

Safety: Are there any places on the property where you could injure yourself? Broken windows, stairs w/o railings, falling, tripping hazards etc?
Security: Can the place be made secure? i.e. doors, windows, etc function and lock.
Soundness: Does the bldg, foundation, mechanicals, outbldgs, fencing, etc have any structural or other issues? Exterior peeling paint is a big no-no.

 

[GWISC]

The last time I was doing FHA was a while ago. I don't believe that much as changed. Safe, Sound and Secure is a VA standard, not FHA. When I was doing FHA, they had a laundry list of required inspections which also includes any items the appraiser deemed as being needed that may not have been specifically covered in the handbook.

 

[Terrel L. Shields]

I call that trespassing.

Wrong answer. It might be, but likely wasn't.

I myself would wait until the report comes out to avoid doing unnecessary work, especially spending money on a house that you don't yet have title to.

Right answer. If it doesn't close, guess what? You're out the money. I know a couple who bought land and cleaned fence rows, bush-hogged the acreage, cut trees and built fence. Then found out the owner had no clear title. They were out a lot of labor and some expense.

And the bank may have an issue with any "repairs" you do such that might keep them from perfecting their lien. I recall one instance where some guy buys a property and sent dozers out immediately to start a foundation. The banker came by to look at the property and nixed the loan. The dozer guy would have a lien potential on the property that would supersede the banks. In the end, he lost his earnest money and someone else bought the property before he could get financing. I was told explicitly not to start construction on my house before the loan was approved.