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Please explain this. We had our appraisal for our buyer's FHA loan done on Wednesday and I am very nervous about it. We went to contract on 8/5 and had an inspection not even a week later and the minimal items noted on inspection have already been corrected.
However, the appraiser got out of his car and upon talking with the buyer's realtor was shaking his head because there are no "real comps". We live in a small subdivision with a less desirable zip code than the property actually is deeded to and we have the benefit of a much better school district but the appraiser is saying he must use the closest sales within a year. Well nothing in our subdivision of 58 homes has sold in a year and the next closest sales are in the same zip code but not the same school district. We had an idea that this would happen so we got our own appraisal done and he used 6 comps to arrive at his value of $495,000. We sold to the first people that looked at it for $485,000 figuring that was "safe". The buyer'so appraiser said my appraisal was irrelevant and wouldn't even look at it. The last house that sold was on my cul-de-sac and it was the same house with 1 room less. It did not have the wood floors, fireplace, central vac or full finished basement with full bath that I have. This house also sold to the first people that looked at it for the full asking price of $429,000 in November 2012. This he also says is irrelevant.
So I am wondering what will be. I really don't want to lower my price to whatever number their appraiser will come up with. They are only putting down 3.5% because they need money to furnish the house. I don't really see how that's my problem, they need to make the bank feel comfortable with the deal, not me. Should I just prepare to find another buyer with more money down and not an FHA loan? Unfortunately the buyer's realtor, and now the appraiser, know that we are having a house built in FL that will be ready the end of November. I'm really going to be pissed if the appraisal comes in lower than the sale price.
Sorry to OP to post such long rant but this an important topic to me too
If the houise was priced right and the appraiser is competent you should have nothing to worry about.
FHA Appraisals with case numbers issued after 9/14/2015 have a lot folks concerned.
HUD has combined the previous manuals and Mortgagee Letters into a new manual number 4000.1. While there are some minor changes, most of the requirements are the same as they always been.
Having just gone through this as a seller, the buyer had FHA and chipped paints etc had to be fixed, smoke detectors had to be voice alerts etc. I just spent about $800 between fixing paints and smoke detectors.
FHA tends to be very fussy if the house was built before 1980 I think.
Since the buyer and his family are handy, I'm hoping he'll be willing to make any repairs necessary to satisfy the FHA. We've already agreed to come down on the price to meet his offer (after previously lowering the price by 1/3) and cover his closing costs... Any reason that arrangement wouldn't work?
It's YOUR house. You MUST complete the repairs prior to closing for FHA. The repairs can't be made after closing. The problems are YOURS to fix. Sounds like maintenance hasn't been kept up and that's on you. No buyer is going to pay you to fix your problems.
14. Is there a requirement for smoke detectors?
Although FHA strongly recommends them, smoke detectors are not a nationwide HUD
requirement at this time. The 203(k) rehabilitation program requires that smoke detectors be
installed adjacent to sleeping areas.
This house has chipping paint on the exterior windows... However, if you don't OPEN the windows, no small child (assuming there is one; I am still not sure why it takes the FHA to raise a child, as it were) can get at the paint chips! I'm not replacing windows; sorry...
It's YOUR house. You MUST complete the repairs prior to closing for FHA. The repairs can't be made after closing. The problems are YOURS to fix. Sounds like maintenance hasn't been kept up and that's on you. No buyer is going to pay you to fix your problems.
I'm sure this isn't the first "estate sale" in which the elderly owners haven't kept up every little item and adult children (who usually live across the country; we just happen to be close by) don't care to bother with repairing the family home and just want it sold...
Not to mention, you've eliminated buyers who can only qualify for an FHA loan. From other threads, it sounds as if your home is geared toward low income buyers who, presumably, cannot save the standard down payment a conventional loan requires. So your pool has shrunk even more.
What do you mean, I've eliminated FHA buyers?
Boxermama, no worries! Hope it all works out okay for you.
Another question (in case our doesn't appraise high enough, although I think it will). It comes with an extra building lot. Could we, in that case, sell that lot separately somehow?
This house has chipping paint on the exterior windows... However, if you don't OPEN the windows, no small child (assuming there is one; I am still not sure why it takes the FHA to raise a child, as it were) can get at the paint chips! I'm not replacing windows; sorry...
Paint chips from a house built prior to the 1970's will HAVE to be repaired - painted over - to pass FHA. LEAD PAINT! This is serious. It's not all about small children. Lead gets into the soil. Pets can eat the chips. Adults inhale the dust. Plenty to worry about with lead paint. Not something to mess around with at all. Paint is cheap so don't complain. Instead of sitting on City Data complaining, get your butt to a Lowe's or Home Depot and buy some paint and rollers. Get painting!
Quote:
Originally Posted by otterhere
I'm sure this isn't the first "estate sale" in which the elderly owners haven't kept up every little item and adult children (who usually live across the country; we just happen to be close by) don't care to bother...
Doesn't matter if this is the first or 100,000,000th. There are laws and regulations that must be followed. No one wants to buy your problems and pay much for them. You said this isn't a great house in a great area and it needs to be sold, then you need to suck it up and do what needs to be done. FHA has regulations for a reason. Even without a FHA loan, chipped paint would be pointed out in a home inspection and it would be highly recommended to have it fixed due to the age of the house. That lead paint thing can bite you in the but big time.
Another question (in case our doesn't appraise high enough, although I think it will). It comes with an extra building lot. Could we, in that case, sell that lot separately somehow?
Depends on your deed and the code where you live. You need to contact city/town/village hall and ask them. No one here will know the answer.
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