Strict Requirements for FHA?

Question

We are looking into buying a house that was recently flipped. We will be going the FHA route. However, the garage was not touched at all. I'm afraid the inspector will reject the loan because of the garage. It has two boarded up windows, and a few floor boards that are tore up. Any assistance on where to go from here would be greatly appreciated!

Bill Gulley · Answer

The issues with FHA are not all of a sudden, many Realtor's here won't get involved with an FHA offer on a property that's more than 10 years old as there can be issues with age of mechanicals and roof.

While appraisers get hammered and can lose thier ability to do FHA if there are undisclosed issues they simply CYA. If there are really nit picky issues, take a picture of it and send it to the lender, an appraiser doesn't use a 1,000 words to describe an issue and a picture can help the underwriter determine the circumstances.

From the picture I get from the OP, I doubt the property is an FHA deal. Go conventional!  :)

David Niles · Answer

I dont think it was all of a sudden, in fact, I was told they were supposed to be loosing up some.  I havent seen it yet though, had a house with painted wood shake shingles that they made us touchup 3 times because the paint wouldnt stay stuck to the damp shingles in November.....

I told my partner once I was going to put a hole in the wall directly across from the entrance so these inspectors could feel validated with their job.  I have everything done almost perfect so they end up nit picking the crap out of me.

Wayne Brooks · Answer

FHA, at least here, requires the windows to be replaced and functional.  A detached gagrage will have same basic requirements as the house, as for health and safety-no trip/fall hazards, safe electrical, etc.

Scott W. · Answer

I don't understand...why did the FHA inspectors all of a sudden get strict on repairs? Is it because they got stuck with all these homes when everything tanked?

Matthew Warden · Answer

I guess I should of mentioned that the garage is not connected to the house. It's on the property, though. It's definitely an OLD garage.

Bill Gulley · Answer

Welcome to BP! I've seen FHA appraisers mention a hole in a screen as if a pencil bent the tiny square hole in a rounded shape saying the screen would not prevent a fly from entering. While I believe they aren't as strict now, they are probably the most restrictive in lending, so, while the window may not be required, if it's there my bet is the glass will need to be replaced. I don't know how floor boards could even be in a garage, but I'd say that is probably an issue as well, not to mention that you have a wood floor in a garage, but whatever. Age of a property can also be an issue, the economic life must be greater than the loan term. Good luck... :)