FHA mortgage question.?
Can a home being sold "as is" be purchased with an FHA loan? The house I am looking at needs a few repairs, nothing major, but will it go through?
- Christin KLv 71 decade agoFavorite Answer
The FHA will inspect the property before the sale to see what repairs should be done. You as buyer will then get a list of these, and you can then contact them (through your agent) to let them know what you will accept, what you will do, and what the seller must do before the sale. The seller will get the same list. They can then decide to allow you a certain amount in escrow for repairs (you can access it then before or after moving in,) or if they will complete them. No matter when the repairs are done, or who does them, the FHA will have to re-inspect and pass them, so you can't cut corners here (neither can the seller).
The repairs will have to be finished and proof that they were done and paid for presented to the lender BEFORE the loan can close. This is especially important when the repairs violate the codes in your area: plumbing, wiring, contaminants (i.e. lead paint removal/replacement) or roofing, septic or construction faults.
If you speak to the FHA and tell them you are willing to "sign off" on the minor repairs and accept the property as is, they may say okay--but there is no guarantee.
- loanmasteroneLv 71 decade ago
If the damages are cosmetic then you might ask your loan consultant about a FHA 203K mortgage.
Under this mortgage FHA would allow a certain amount in the mortgage loan for a few repairs.
You will need a FHA appraisal that indicate the repairs and possible cost of the repairs. Your loan consultant should know what to do and point you in the right direction.
Now this type mortgage does not cover roof, foundation or major repairs.
I hope this has been of some use to you, good luck.
- Laura SLv 41 decade ago
As long as the home is appraised for at least the amount you are offering it will usually make no difference. There are times, where depending on what state you live in, they will require something like a broken window to be fixed to be able to pass inspection, and in this case it couldn't be done- but if there is nothing of the sort you shouldn't worry about it going through. If you can get the house and there are some repairs, major or minor, that you may not have the cash on hand for, there is a program called the 203K Rehab program, through FHA where they will lend you the money you will need to fix the home in addition to your mortgage. Good luck!
- Anonymous1 decade ago
Sure, "As-is" just means that the owner's aren't willing to do any repairs. If there are no major repairs that need to be done, then it won't be an issue with an FHA loan. If there are repairs that need to be done, you may be able to negotiate something with the sellers. You might also be able to designate funds at closing to use for the repairs, but you'd have to check with your FHA loan officer about how that works since I'm not an expert.