In Desperate Need of Advice

[missthang]

My husband and I are currently in the process of buying a REO home. The house has some minor things wrong such as: 2 small holes in floor, hole in ceiling, missing wall cabinets and only 2 light fixtures in the entire house. We have to go with a conventional mortgage and we have been told that when the appraiser comes out they may deem it non livable. Does anyone have any info about my situation? Thanks in advance!

 

[Michigan CG]

Is the mortgage going through FHA?

 

[Restrain]

If a home is not complete, the appraiser may either do the home "as is" with significant adjustments, or "subject to completion of repairs", with a list of needed repairs. It's going to depend on the lender, type of loan, etc.

Talk with your lender about what they are going to require, because the appraisal will be based on the lender's guidelines.

 

[Blueprint]

Based on what you are saying, it sounds like the improvement is livable. That being said, holes in floors and ceilings are not typical issues. Why would the lender be telling you this? It sounds like there may be some missing info. Please provide more detailed info to us if you want a more detailed response. Thanks.

 

[Richard Rector]

An unethical appraiser may just ignore these problems. An ethical appraiser would report these problems and appraise the property as is and estimate a cost to cure or appraise the property subject to the items being repaired based on the lender's guidance. This would mostly apply to the missing lights and any safety issues or major defects. The lender will most likely require the completion of the repairs before settlement if the appraisal is made subject to the repairs being completed. If the appraisal is made as is the lender can still require the repairs to be done before settlement or they can close the loan with the property in as is condition at their discretion. If you are very well qualified and have a large down payment they will be more likely to let it close as is. Also, if the original lender which now ownes the property is providing the financing they will be more likely to settle as is to prevent the sale from falling thru. The worst case is if the lender requires repairs before closing you will need to get access to the property, make repairs and have it reinspected $100 to $150 fee? In most cases the REO owner/management company will not make the repairs. You can always ask or tell them the sale will fall thru if you don't do these repairs. It all depends on how much you want the property and if you feel it is a really good deal. If you think its a really good deal and are sure you want the house you may want to go ahead and do the repairs before the appraiser even goes out to see it. Good luck!

 

[missthang]

The house is being sold as is with the minor problems it has... we are going for a conventional mortgage because the bank that owns it wouldn't give us extra time to get a 203-k loan. The mortgage company isn't worried about the appraisal value, we know it will be okay. They are just suggesting that the appraiser might say that it's non livable because of the few issues that I stated earlier. We called a random appraiser out of the phone book and he said from his opinion he thought the house would be fine how it stands right now without anything being done to it. I just wanted to get other opinions because I'm a little worried that we won't be abkle to get it because of very minor problems.

 

[Dale Smalley]

Check out the 3 S's It should be Safe, Sanitary and Secure to be livable.

 

[Doug Wegener]

Dont Worry

My husband and I are currently in the process of buying a REO home. The house has some minor things wrong such as: 2 small holes in floor, hole in ceiling, missing wall cabinets and only 2 light fixtures in the entire house. We have to go with a conventional mortgage and we have been told that when the appraiser comes out they may deem it non livable. Does anyone have any info about my situation? Thanks in advance!

I wouldnt worry about a problem you dont have yet, and besides what can you do about it?

 

[The Warrior Monk]

The question can't be answered because there are too many variables. The short answer is you have to check with the lender on their guidelines.

 

[RSW]

Check out the 3 S's It should be Safe, Sanitary and Secure to be livable.

If you are referring to FHA, it is Safe, Secure and Sound.