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Termite report required?

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Michael Edwards

Freshman Member
Joined
Dec 30, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
A lender tells me that a termite report is not required on an FHA streamline refi. Is this true? I have always required termite inspection on all FHA appraisals. Also I have been told that on the "Notice to Home Buyer" in the space where you put "Y" for yes, that you only put Y if you know there is a problem. For example, you require termite inspection but you observe no termite damage, you leave the problem field blank and state that a termite report is required in the comments field, while if you observe termite damage you a Y in the problem field. Any help would be appreciated.
 

rtubbs

Junior Member
Joined
Jan 15, 2002
Michael, per the HUD Homeownership Center Reference Guide, FHA does not require repairs (except for lead Paint repairs) on streamline refinances with appraisals; however the lender may require completion of repairs as a condition of the appraisal. I have never called for termite inspection. You do have to complete the VC forms. I mark yes under the 5a and state that an inspection is only required at the option of the lender.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Here is the standard text I put in all Streamline Refis on page 4 of the VC. Additional repair items are also always listed per individual property and according to the handbook (just as if it's a purchase)

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THIS IS A STREAMLINE REFI. OTHER THAN LEAD BASE PAINT ISSUES, THE DE UNDERWRITER HAS THE OPTION OF WAIVING VC INSPECTIONS AND NOTED REPAIR ITEMS.

VC-5-a: Structure is ground level. No noted obvious infestation. WDO inspection and report would be ordered by the DEU for this Streamline REFI.

VC-10-a-l: The central heat appeared to be properly functioning. As it is not safe for the heat pump to be turned on to air conditioning during the winter months, it was not turned on. If further inspection of the HVAC system would be required, it must be done by a licensed HVAC contractor.
 
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