Re: FHA, Ship Program & BB Gun!!! - Posted by Ron (MD)
Posted by Ron (MD) on February 16, 2001 at 08:45:31:
I don’t know anything about the SHIP program, but I have recently sold rehabs with FHA financing.
I have been asked to document the repairs I’ve done and my standard approach is to give the lender a one-page summary showing the 15 or 20 larger things I’ve done. On a few occasions, I’ve also given them a copy of the actual scope of work (6 pages) used for the project. In one case, I provided the lender with copies of my repair receipts (a 19 page fax!).
The lender told you that it might be a problem with an unseasoned property. You need to confirm that the lender doesn’t have a problem with it. The loan officer can talk to underwriting and determine this immediately. If it’s a lender problem, your buyer needs a different lender. If it’s an FHA problem, you can’t do anything about that until FHA reviews the file…which isn’t until after the lender has approved the loan.
Finally, you asked about doing repairs before the “inspector” comes. I’m assuming that you meant “appraiser”. FHA will not approve a home with broken or cracked windows. (I don’t know about the siding.) You will have to repair the window prior to settlement.
No matter how good a job we try to do on our rehabs, the FHA appraiser almost always identifies a few minor problems that must be corrected prior to settlement (e.g., repair a cracked sidewalk, add a handrail, etc.). Based on that, it is likely that the appraiser will have to come back a second time for a re-inspection. Since he/she will have to come back anyway, I wouldn’t repair the window until later (prior to the re-inspection). You can schedule the re-inspection just a few days prior to settlement.
This way, you delay putting in a shiny new window for the neighborhood vandals to shoot at again. The later you can put that in, the better.