Another FHA " Property Disclosure " .... NOT meeting FHA minimum

2 Replies

I was browsing around today , through various properties that are listed on the HUD website in my area, and I came across a property that is in a nice location, looks to be in good condition both exterior and interior from the pictures, and is listed for a really good price.

So I thought ... what gives ?

Well I pulled up the property Disclosure , and it states the following ..... "

PER APPRAISER, PROPERTY DOES NOT MEET FHA MINIMUM REQUIREMENTS. REPAIRS EXCEED $5,000.
PER APPRAISER, PROPERTY DOES NOT MEET FHA MINIMUM REQUIREMENTS.
PROPERTY HAS BEEN FOUND TO HAVE AN ILLEGAL GARAGE CONVERSION.
PER APPRAISER, PROPERTY DOES NOT MEET FHA MINIMUM REQUIREMENTS.
PROPERTY HAS BEEN FOUND TO HAVE AN ILLEGAL ADDITION. "

So apparently, the owners converted their 2 car garage into a Living area.

This property therefore ( per FHA guidelines ) is not Insured .

Is there a way around this " Illegal " garage conversion ?

Does this mean that an O.O. could NOT buy it, but that an Investor ( putting 20% down through a Conventional loan probably could purchase this property ) ?

Thanks

This means that the property in not eligible for FHA financing in its current condition. It can be purchased by all other means ie Cash or Conventional financing by an owner occupant or investor(once it enters the extended period)