Learning about FHA.question re:unacceptable location

[esturni]

Hi all,

I've been speaking with a family friend (now retired) who has FHA experience. We were talking about unacceptable locations, and he gave me an example of an order he turned down.

http://maps.google.com/maps?hl=en&q=70 isabella ave bayonne, nj&um=1&ie=UTF-8&resnum=1&sa=N&tab=il


Look to the right and below the subject. He said this home would not meet MPR because of the industry (refineries I think) nearby. I think the report can be done, as long as there is no observable smells, noises, etc. From appendix D:

The appraiser must note and comment on all hazards and nuisances affecting the subject property that may endanger the health and safety of the occupants and/or the structural integrity or marketability of the property, including: subsidence, operating and abandoned oil and gas wells, abandoned wells, slush pits, heavy traffic, airport noise and hazards, runway clear zones/clear zones, proximity to high pressure gas, liquid petroleum pipelines or other volatile and explosive products, residential structures located within the fall distance of a high-voltage transmission line, radio/TV transmission tower, etc., excessive hazard from smoke, fumes, odors, and stationary storage tanks containing flammable or explosive material.

If hazards or nuisances are observed, the appraiser must describe the condition(s) and make a requirement for repair and/or for further inspection, and prepare the appraisal “subject to repairs” and/or “subject to inspection” in the site section of the report. Supporting documentation provided by the appraiser may include extra photos or copies of site studies or analyses, property reports, surveys or plot plans, etc.

In my opinion, the report can be done as long as the location is noted. Agree, disagree?

Sorry for the long post, I'm trying to learn as much as I can. Thank you!

 

[ZZGAMAZZ]

Turning down the assignment because of potential negative implications of the report is unacceptable. IMO it's an appraisal issue rather than a business decision because the decision was based upon issues that would affect saleabilty and goes to the "pre-determined notion..." of things. The appraisal report should have been completed and HUD notified of the condition so the lender is prevented from hiring another appraiser who is less forthwrite in his analysis.

 

[esturni]

I agree... the thing I am confused about... this would have to be done "as is" right? There are no repairs or anything that can be made. Also, if you look at the map, there are a lot of homes in this area with similar locations. It seems like it's a market accepted place to live.

 

[stefan olafson]

Not taking the time to look at the HUD handbook may come back to bite me, but....

I beleive there is a distance requirement from hazards such as a refinery or a gas station?????

Right?

 

[esturni]

found part of my answer in appendix D:

"For those conditions that cannot be repaired, such as site factors, the appraised value is based upon the existing conditions."

 

[esturni]

Hmmm but then says

" If hazards or nuisances are observed, the appraiser must describe the condition(s) and make a requirement for repair and/or for further inspection, and prepare the appraisal “subject to repairs” and/or “subject to inspection” in the site section of the report. Supporting documentation provided by the appraiser may include extra photos or copies of site studies or analyses, property reports, surveys or plot plans, etc."

So first, as is, then subject to inspection?This stuff is confusing

 

[Mike Boyd]

You do not "reject" the assignment, you reject the property because of the unacceptable environment. Write a letter, show photos of the unacceptable conditions, provide a map showing distances and submit a bill for your time. The last one I rejected I charged half the full fee. You might want to send a copy to FHA and be sure to include the case number and address.

 

[Mike Goodpaster]

I have a current order similar to this one. I have a house approximately 500 feet from a large grain elevator and even less from an old abandoned manufacturing building. I have been looking through the handbook but cannot find anything that mentions distances. I thought at one time I seen where they said the home had to be so far from industrial buildings or ag land. Any help finding this wording would be great. I would like to have something concrete I can show my client. Thanks.....

 

[RSW]

Go to the EPA website and pull the map. It will show if there are any hazardous materials in the area. Provide a copy of the map.

http://www.epa.gov/enviro/wme/