Ocean Springs, MS · Member since 2017 · 71 posts · 32 votes
We are selling our house and the buyer is using FHA financing. We have heard nightmare stories of FHA financing as far as being the seller of the house. I know the restrictions to the home inspection have become a little more lenient, but we have no idea what to expect. What are some things that we should be aware of as far as the inspection and the process to close? Thank you for any advise.
New to Real Estate · San Diego, CA · Member since 2013 · 101 posts · 78 votes
8y
Dont stress too much. I have purchased a nasty home on fha before. They did the same inspection everyone else does.
They dont want to see broken glass, leaking gas lines, mold, visible safety issues.
If your selling a decent house you have no worries.
If your selling a rehab do your best to eliminate any safety concerns or clearly visible issues that would raise a major question.
Investor · Knoxville, TN · Member since 2017 · 34 posts · 16 votes
8y
FHA inspections are different than the standard home inspection because the inspector has to go by the FHA's requirements. With the standard home inspection, the buyer typically hires the inspector and has the option to overlook certain items the inspector finds and choose whether or not to ask the seller to make repairs. With the FHA inspection, the inspector (appraiser) is hired by the lender and the loan may not be approved unless the seller repairs the items. Some issues I've come across are steps with missing hand rails, roofs with less than 2 years of life remaining (seller had to replace it in order to close) and no stove in the kitchen (seller took it when he moved out). Also, if the home is on a septic system or water well and there is public sewer/water available at the street, the house will need to be connected to the public system. You can find more information here: https://www.investopedia.com/articles/mortgages-real-estate/11/fha-minimum-property-standards.asp
Ocean Springs, MS · Member since 2017 · 71 posts · 32 votes
8y
Thank y'all so much! Such good advice as usual from great people. It's a good house but not perfect. The inspection is scheduled for Wednesday. Fingers crossed!
Investor · Lee's Summit, MO · Member since 2017 · 81 posts · 37 votes
8y
I sold a nice house that required an FHA inspection two years ago to close the deal. They took wide latitude with their punch list. It's like they equated amount of repairs to their inspection performance just like some insurance inspections. I don't think anyone has gotten a clean report. It comes down to a bird in the hand or wait for another buyer. Good luck.