Based on your answer simply put, yes. The underwriters can deny for just about anything. They have to look at the entire package. They may have doubted your ability to do the repairs, and had to add in the amount it would cost to do the repairs to the price of the house, and that threw off the loan to value. Also, my understanding of USDA loans are that certain guidelines must be met. And the underwriters may have found that they were not. Unfortunately a loan is not really approved until the underwriters say so, and that can be as late as the day before settlement! Good luck.

Kaemae the area was undoubtably in an USDA area but the properties are to condition guidelines. These are similar to the FHA guidelines. Here is a link to the eight page checklist that is required on an USDA loan.

http://www.rurdev.usda.gov/id/5-0_Existing.pdf

While you may consider some items minor repairs the appaiser has to look at the property and find it in good repair. Good luck and by the way I have had buyers do the labor before reinspection to be able to get the home that they want.

Hello Kaemae, I am not a mortgage underwriter so I can only give you my two cents worth! If you are working with a Realtor, your Realtor should contact the company for whom the underwriter works for more information. Perhaps that underwriter is mistaken about something. I know they are all shy about mortgages right now but I just read where Freddie Mac was telling the banks to use local appraisers and to not use foreclosures to appraise unless that is all that is on the market in an area. So maybe the underwriter is unfamiliar with this kind of home too. You won't know until you ask. My only guess about the paint is that if it is peeling, it could contain lead which would poison anyone who injested it (intentional like kids do or accidental like through the air). The tin roof? Can't even guess at that one. It sounds though like you have some bargaining power with the seller. If your underwriter won't approve because of these issues, then they probably won't be able to get it underwritten through any bank. Go back to the seller and discuss. Maybe they'll fix everything that needs fixing and then the underwriter could approve it. Probably will need another inspection to ensure those things are corrected though. Good luck on this one! All my best! Cher