Home Buying in 49506>Question Details

Sara, Home Buyer in Kentwood, MI

buying a house on a FHA 203 loan, will low railings and outdated outlets cause a problem?

Asked by Sara, Kentwood, MI Wed May 23, 2012

We are buying a house that is a short sale so time is of the essence right now. Especially since we got the approval two days before i had the estimate scheduled with the contractor. However we were not sure if some things were necessary to do along with the roof. The things we were not sure of are the stair railings to go upstairs and the majority of the outlets. the stair railings isn't tall enough and the slats are like 5 1/2 in apart. The outlets are outdated. Not really sure exactly what is wrong with the outlets. I know that these are both things that we are capable of doing i just really didn't want to do it now and put it on the loan because we can do it all ourselves. my family is very handy(just not me so please excuse my lack of knowledge in this question.) so i would like to do it in a few months when we have saved money rather than putting it on a 30 yr loan. So anyways, back to my question, i cant figure out if the FHA appraisal will deem that something that is necessary

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Answers

2
Hello,

FHA inspectors have to follow guidelines and everything MUST be up to code, or else it is going to be written up on their report. Also you mentioned that YOU, or some of your family members may do some of the work. That will NOT be allowed.

When you do a 203K loan, all contractors must be licensed and insured. You CANNOT do the work yourself, it will not be allowed. What you do have control over, is which Licensed contractor CAN do the work. Just because you received an estimate from one contractor, doesn't mean you MUST use them. I am dealing with a 203K loan now and the buyers have a friend that is a Licensed Builder & Contractor and they are more comfortable with him doing the work than a total stranger.

So this contractor must submit his estimate on his company letterhead, and the lender uses that as part of the "file" or approval process.

The great thing about a 203K loan is you can add things to the loan that may never have crossed your mind, such as granite counter tops, etc. Your lender can guide you in this process because it can get a bit confusing, and time is of the essence, and it sounds like you don't have a lot of time to waste.

I hope this helps and feel free to email me with any more questions.

Thank you,

HAIG
Elias Realty
(248) 379-6547
realtorhaig@aol.com
0 votes Thank Flag Link Thu May 24, 2012
Most likely those issues will be an issue for FHA financing but it all depends on the appraiser. The outlets may not be GFCI outlets and that will usually come up in the FHA appraisal. It is not very expensive to fix, so if you are looking to get through this process smoothly, you may must want to include it in the mortgage.
Web Reference: http://www.brekschutten.com
0 votes Thank Flag Link Thu May 24, 2012
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