FHA Appraisal           

FHA requires maximum assurances that a home is free of any infestation. A pest inspection is always required for a structure that is ground level or any structure where the wood touches the ground. However, structures in a geographic area with no active termite infestation may not require a pest inspection.

New Construction: The builder of a new home, proposed construction, a home under construction and a home less than one year old must provide a warranty against termite infestation in a new home for a minimum of on year.

All chemical soil treatments, bait systems, and chemical wood treatments must be approved by the Environmental Protection Agency (EPA) and applied in accordance with the EPA label instructions. In some cases where these methods are not feasible, pressure treated wood may be used as a measure of termite protection. Also, the use of post-construction soil treatment where the chemicals are applied only around the perimeter of the foundation is not acceptable in new construction.

Termite inspections are not required for streamline refinances with or without an appraisal.  Termite Inspection are not required unless noted by the appraiser on purchases or refinances.

Lead based paint:

For all properties built before January 1, 1978, the FHA appraiser must inspect all interior and exterior surfaces, such as walls, stairs, deck, porch, eaves, windows, doors, fences, etc. for defective paint surfaces (i.e. chipping, peeling or flaking paint).

If the paint is cracking, scaling, peeling, or loosening on any interior or exterior surfaces, the affected areas must be thoroughly washed, sanded, scraped or wire-brushed to remove all of the defective paint (machine sanding or use of a blow torch is not acceptable). A ground cloth should be used to catch particles of paint and surface removed and a thorough clean up should be accomplished after the surface has been prepared for painting. All materials cleaned up should be removed from the possibility of ingestion by humans. The treated surface must be repainted by a paint that closely matches the existing color, using a minimum of two coats of paint unless the affected areas are covered, when appropriate, by a material such as plywood, plaster or other suitable material.

Radon:

HUD does not require radon testing of homes to be insured by FHA financing.

Asbestos:

Asbestos used as roof shingles or siding on a house does not pose a danger. When used as a wrap for hot water pipes, it is usually covered and poses no danger. When the material is deteriorating into a fine powder and can be inhaled, it may pose a danger to one's health. Asbestos should be removed by an expert only in those cases where the deterioration poses a serious health threat; otherwise the appraiser may condition for repair of the puncture or other damage.

The property may not be eligible for FHA financing when it is subject to hazards, environmental contaminants, noxious odors, offensive sights, or excessive noises to the point of endangering the physical improvements or affecting the livability of the property, its marketability, or the health and safety of its occupants and cannot be acceptably mitigated.

Airports: Locations near an airport may be subject to the noise and hazard of low flying aircraft. Existing properties are not to be rejected solely based upon the property's proximity to an airport unless there is indication that adverse changes in market attitude is taking place in the area (such as declining market values due to the noise). Existing homes more than one year old are acceptable in a Runway Clear Zones if the buyer acknowledges awareness of such location. Homes less than one year old are not eligible.

Railroad tracks and other high noise sources: If the home is over one year of age, noise exposure will not result in automatic rejection unless the environmental noise is a marketability factor. A site exceeding an average day-night sound level of 56 decibels in normally unacceptable, though measures may be taken to reduce these levels. Anything over 75 decibels is not acceptable. The loan may not close until certification has been made that the average day-night sound level is within acceptable levels.

Flood areas: Homes located in zones "A" and "V" (as stated on the FHA appraisal) will require flood insurance. Homes located in zones "B" and "C" do not require flood insurance. Homes that require flood insurance and are not located in an area where the National Flood Insurance Program is in force are not eligible for FHA financing. New and proposed construction is not eligible if any part of the home that is essential to the property's value and subject to flood damage are located within the 100 year flood plain. Properties subject to frequently recurring flooding, subject to any potential hazard to life and safety or where escape to higher ground would not be feasible during flooding conditions are not eligible for FHA financing.

Overhead high voltage transmission towers and lines: High voltage lines are those that carry 60 kilovolts or greater. Distribution lines are the common lines used for supplying power to housing developments and similar facilities that often carry 12 kilovolts or less. No home may be located within the designed fall distance of any pole, tower or support structure of a high-voltage transmission line, radio/TV transmission tower, microwave relay dish or tower or satellite dish (radio, TV cable, etc.). Neither high voltage nor distribution lines shall pass directly over any structure on the property (this does not include service lines that deliver power to the house).

Oil and gas wells and tanks:

Operating wells: No existing home may be located closer than 300 feet from an active or planned drilling site. If an operating well is located in a single family subdivision, no new or proposed house may be built within 75 feet of the operating well.

Abandoned wells: Assuming a letter from the responsible authority in the state government that states the subject well was safely and permanently abandoned, a home may be located no closer than 10 feet from the abandoned well. If no such letter is provided, the home must be located at least 300 feet from the abandoned well.

Underground tanks: If an underground tank has been abandoned, its removal or proper abandonment is required (subject to applicable requirements and guidelines for removal).

These conditions are not listed to scare you, but to help you understand and erase any worries you may have.

The purpose of a repair is to correct deficiencies which may affect the health and safety of the occupants or the continued marketability of the property. If possible, we suggest that you make any repairs to your home prior to the appraisal. This will improve the marketability and help the sale or refinance of your home go smoothly.

Keep in mind that these are the most common repairs. Contact your lender with specific questions regarding your property.