I was fortunate to be able to do something recently that I wish I could have done years ago! I tagged along during an FHA appraisal. I had approached our mortgage loan originator and mentioned that I sure would like to actually be present during an FHA appraisal and learn just exactly what the appraiser is really looking for during the property inspection part of the appraisal process. Within days she had hooked me up with an appraiser that agreed to allow me to tag along on his next upcoming property inspection that required an FHA appraisal.
With the tremendous rise in the number of FHA loan packages now being approved for buyers, it has become more critical than ever to gain a better understanding about the FHA loan appraisal process. Whether we are working with a buyer or a seller, it sure is nice to have an understanding of why a property will (or will not) qualify for an FHA loan, and what amount of repairs would need to be completed in order to allow it to qualify.
Up until the time I actually got to experience the process, lots of confusion kept swirling around in my mind due to all the war stories about FHA loans that I had heard throughout the years. Now I can feel tremendously better due to the knowledge that the appraiser allowed me to gain while he verbally explained to me each item he was looking for (and at) as well as why. During the process, he had told me about the need for the property to meet the minimum guideline of being safe, sanitary and secure. As he made his way through each area of the house, he pointed out conditions that he considered as simply being cosmetic items that would not need a notation on the appraisal form. He also went on to tell me about which items would need a notation, as well as why those items were not safe, sanitary, or secure. He also told me what action would be required in order to bring the noted item to minimum standards.
From now on when I am in the process of listing a property, I will feel a brand new sense of confidence in being able to help the homeowner address any items that need to be completed in order to make a property "FHA ready". Also from now on when I am with a buyer and showing homes, I will be able to point out which items they will need to either address or have the seller address should they be considering an FHA loan package. Since a greater percentage of loans are FHA, it makes sense for the seller's property to appeal to the maximum number of buyers by striving to have the property meet FHA guidelines. I can now provide a better level of service due to my new found knowledge to both buyers and sellers.
I owe a debt of gratitude to the appraiser that allowed me to tag along and for taking the extra time to explain the process to me.