First, pools are not a problem with USDA, the problem can be the appraised value of the home. What? How? Â USDA has a rule that requires appraisers to deduct the value of any pool from the overall appraised value of the home. Example -
Home value as is - $200,000
Value of pool alone - $10,000
Appraised value used for qualifying and underwriting - $190,000
Now, this can often times be an issue for USDA buyers because they frequently use increased appraised value to help pay closing costs. Remember, USDA allows buyers to increase their loan amounts up to the appraised value to cover closing cost and many of them do this. With the pool value being deducted, there may not be any room left for closing costs which can lead to other issues. Keep in mind, most of the USDA home buyers are first time buyers, money is tight. More importantly, because of the pool value being deducted, the appraised value may not even meet the sales price alone.
So, new home buyer using the 100% USDA loan for a home that has a pool? Try to check the value as much as you can in advance and remember the value of the pool will not be included. Also, if you (or your buyer) need assistance with closing costs, it may be a good idea to get sellers concessions for this if possible. By doing this the home only has to appraise at sale price.
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