FHA Appraisal Inspection Quick List
- March 29th, 2017
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Many different issues can come up during an FHA appraisal inspection. From years of experience, we notice some that appear more frequently than others. These are issues all Salt Lake homeowners should be aware of when taking part in an FHA refinance or when selling their home to an FHA buyer. Unfortunately, any of these items could delay the closing of your transaction. For this reason, it’s a good idea to prepare in advance by correcting any of these items before the appraiser performing an FHA inspection of the property. Safety, Soundness, and Security (the three S’s)– are the primary goals that an FHA appraiser looks for when inspecting a home. Everything on the appraiser’s checklist is meant to ensure the property is safe and habitable so that the house will serve as proper security or collateral for an FHA loan. Utilities Must Be Turned On – All too often, and especially with vacant properties, one or more of the utilities may be turned off. This prevents an appraiser from completing a full inspection of the property. When this happens, the appraiser conditions the appraisal for the utilities to be turned- which on delays the loan process, and often costs more money in appraisal fees. The appraiser will have to return at an additional charge to complete a full inspection once the utilities have all been turned on. The appraiser will ensure that all related mechanical items are functioning properly including the plumbing, running hot water, heating units, central air, gas stove burners, lighting, outlets, and more. Missing Carbon Monoxide Detectors — As per Utah Administrative Code, detectors are required to be installed on each habitable level in new residential structures. This means properties must have approved devices on each floor that have fuel-burning appliances, heaters, fireplaces or attached garages. Frayed or Exposed Electrical Wiring — This might seem to be obvious, but you may be surprised by how many homes have this issue. Older homes, and often homes bought as ‘Do It Yourself” projects, have frayed or exposed electrical wiring. These items must be corrected. Additionally, missing light switch and/or missing outlet covers must be replaced. Finally, open j-boxes must be covered, and most exterior outlets require weatherproof covers. Chipped and Peeling Paint on Pre-1978 Structures – The feared “lead paint problem” still lingers as many homes still face this issue. For homes built before 1978, where any areas of chipped or peeling paint are found along the interior or exterior of the home, it must be corrected. This includes scraping and repainting the affected areas. Additionally, all paint chips lying along the ground or areas nearby must also be collected and completely removed from the premises. 5. Roof Condition / Leaking – Regulations provide that the roof must not leak or allow for any moisture to enter the home. Also, the roof should be able to properly function for a minimum of two remaining years. In circumstances where this is not the case, the appraiser must note whether the roof needs repair or requires re-roofing. 6. Insulation in the Attic– Common sense would indicate that there would already be insulation in the attic space and the spaces above the ceiling. An appraiser is required to look into the attic spaces to verify that insulation is there. It goes without saying that if there is no insulation, heating/cooling bills will be much higher, but the appraiser will also have to condition the appraisal for this. Similar to when the utilities are turned off, the appraiser will need to make another trip to the property, often for another fee, to verify insulation has been added. 7. Missing Earthquake Strapping, TPRV’s and Overflow Pipes on Water Heaters – With the exception of ‘tankless’ water heaters, water heaters are required to have double earthquake strapping placed along the lower and upper thirds of the tank. In addition, temperature-pressure relief valves and overflow pipes are needed as well. Although trying to complete all potential FHA repair items before the appraiser’s inspection may not be possible, at least now you’re aware of several of the most common repairs that tend to delay the FHA loan process. Finally, remember that FHA appraisals are no guarantee a property is free from defects. The appraisal ‘primarily’ establishes Finally, bear in mind that FHA appraisals are no guarantee a property is free from defects. The appraisal ‘primarily’ establishes value of the property for mortgage insurance purposes. Buyers should always secure their own home inspections through qualified professionals to get a better overall picture about the overall condition of a property. I hope you found this helpful and if you have any additional questions please don’t hesitate to call. We hope you found this helpful and if you have any additional questions, please don’t hesitate to call Aspen Appraising at 801-260-2828.