Most Common FHA Lender Required Repairs

Most Common FHA Lender Required Repairs

For FHA mortgages, FHA appraisers are to recommend only those repairs necessary to make the property comply with the Minimum Property Requirements (MPR) or Minimum Property Standards (MPS) together with the estimated cost to cure. These repairs are to be based on a visual inspection of property.

Cosmetic repairs are not required; however, they are to be considered in the overall condition rating and valuation of the property. Generally, worn floor finishes or carpeting, holes in windows screens or a small crack in a windowpane are examples of deferred maintenance that do not rise to the level of a required repair but must be reported by the appraiser.

Required Repairs: Required repairs are limited to those repairs necessary to preserve the continued marketability of the property and to protect the health and safety of the occupants, A.K.A. the three S's:

Safety: protect the health and safety of the occupants

Security: protect the security of the property (security for the FHA insured mortgage.)

Soundness: correct physical deficiencies or conditions affecting structural integrity

Listed below are the most common FHA repairs or requirements noted by FHA appraisers. These items, IF noted by the FHA appraiser, will have to be corrected prior to proceeding to settlement.

1. Paint. Chipping, peeling paint must be scraped and painted. This includes interior, exterior, garages, sheds, fences, etc.
2. Windows. Broken windows should be replaced.
3. Handrails. Handrails should be installed at three or more stairs.
4. Infestation of any kind should be exterminated and carry a 12 month warranty/ guarantee (i.e., insects, mice, bats, etc.).
5. Exit Doors. Cracked or damaged exit doors that are otherwise inoperable.
6. Trip Hazards. i.e. cracked or partially heaving sidewalks, poorly installed carpeting.
7. Driveway. Lack of an all weather driveway surfaces.
8. Countertops. Rotten or worn out counter tops.
9. Inadequate access/ egress from bedrooms to exterior of home.
10. Flooring. Defective floor finish or covering (worn through the finish, badly soiled carpeting, etc.)
11. Walls. Damaged plaster, sheet rock or other wall and ceiling materials in homes constructed post- 1978.
12. Crawl Space. If there is a crawl space, it will be the home owner's responsibility to make this area accessible so that it can be thoroughly inspected. All debris and trash in a crawl space have to be removed
13. Wet Basements. The cause of wet basements should be cured (i.e., improve drainage away from house, gutters, etc.).
14. Structural or foundation problems must be repaired. Such as foundation damage caused by excessive settlement, bulging foundation wall or standing water against the foundation.
15. Well/ Septic. Abandoned inoperable wells must be capped and sealed by a licensed, qualified contractor. A clean well and septic inspection can be required at the discretion of the lender.
16. Flammable storage tanks must be removed and filler cap sealed from the inside (i.e., buried oil tank).
17. Poor workmanship.
18. Roof. Roof should have 2-3 years of useful life remaining and no more than 2 layers of shingles. If the home is over 10 years old, you must remove snow from a large portion of the roof for inspection by the appraiser. A roof certification may be required at the discretion of the lender. Leaking or worn out roofs (if 3 or more layers of shingles on leaking or worn out roof, all existing shingles must be removed before re-roofing).
19. Checking Mechanical Systems… Plumbing, electrical, heating systems. The appraiser should turn on the systems and observe their performance. The appraiser may call for a certification of a system when he/she cannot determine if it is working properly. An electrical certification may be required if the system appears to be overloaded. Visible damaged or inoperable plumbing, electric and heating systems should be repaired. The appraiser will check these areas. This includes leaky faucets or running toilets. Any faulty or mechanical systems must be operable prior to settlement.
20. ***Private streets and shared driveways must be protected by permanent recorded easements or be owned and maintained by a Home Owners Association (HOA).  NOTE.  This has been the cause of many delayed closings lately. Underwriters and FHA appraisers are demanding these agreements be in place.  If not, you are unlikely to settle.