Guidelines for Anticipated FHA Repairs
FHA permits only “as-is” appraisals on existing properties.
FHA appraisers will limit their repair requirements to only those items that pose a threat to the security/safety of an occupant and/or jeopardize the soundness and/or structural integrity of the property. Examples that may represent a risk include, but are not limited to:
- Inadequate access/egress from bedrooms to exterior of home.
- Leaking or worn out roofs.
- Evidence of structural problems.
- Defective paint surfaces in homes constructed pre-1978.
- Defective exterior paint surfaces in homes constructed post-1978 where the finish is otherwise unprotected.
Examples of conditions that will continue to require automatic inspection include, but are not limited to:
- Standing water against the foundation and/or excessively damp basements.
- Hazardous materials on the site or within the improvements.
- Faulty or defective mechanical systems (electrical, plumbing or heating).
- Evidence of possible structural failure (e.g., settlement or bulging foundation wall).
FHA no longer mandates automatic inspections for the following items and/or conditions in existing properties:
- Wood Destroying Insects/Organisms – required only if evidence of active infestation, mandated by the state or local jurisdiction, if customary of area, or at lender’s discretion.
- Well (individual water system) – test or inspection required if mandated by state or local jurisdiction; if there is knowledge that well water may be contaminated; when the water supply relies upon a water purification system due to presence of contaminants; or when there is evidence of:
- Corrosion of pipes (plumbing)
- Areas of intensive agriculture within 1/4 mile
- Coal mining or gas drill operations within 1/4 mile
- Dump, junkyard, landfill, factory, gas station, or dry cleaning operation within 1/4 mile
- Septic – test or inspection required only if evidence of system failure, if mandated by state or local jurisdiction, if customary to the area, or at lender’s discretion.
- Flat and/or unobservable roof.