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Jason Braddo…, Real Estate Pro in 44266

I'm a newer agent and haven't dealt with FHA loans yet. I have my personal property up for sale and was

Asked by Jason Braddock, 44266 Fri Jun 27, 2008

asked if we would consider taking an FHA loan as a seller. What are seller concessions when dealing with FHA? Is that a per property thing to get the house up to FHA conditions?

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Jason,
Your questions are good and you will learn all of this as you go! Yes, the FHA requirements vary from Inspector to Inspector on what they require, but the main things are a good (functioning) heat source, something to cook on, and of course no problems that may arise with a Traditional Home Inspection. {Basically they want to be sure that if they (FHA) get the house back they can sell it!} The costs anymore are very well worth the extra exposure that you can bring to your property. The FHA fees are very nominal, but you can check with your mortgage broker that you work with for the exact #'s The fees used to be $1200 but I believe now because FHA has taken the place of the SubPrime Market they are under $400.
1 vote Thank Flag Link Fri Jun 27, 2008
Jason question was posted Jun 27, 2008.
By now Jason has learned the FHA lesson.
0 votes Thank Flag Link Tue Jan 21, 2014
Jason,

Yes getting the house up to FHA conditions depends on the condition of the home. FHA inspectors which are also appraisers had more demanding criteria years ago. Today, the criteria is much more relaxed, but they do look for safety hazards heavily.

In todays market, buyers purchasing FHA are most likely to ask the seller to pay the buyer's closing costs. These costs will depend on the price of the home and the percentage or dollar amount requested by the purchaser. This is not mandatory with FHA lending but is typical and you do not have to agree to do so. However usually the FHA buyer is short with upfront dollars and therefore will ask for seller concessions. Hope this helps and good luck with your sale and your real estate career.
0 votes Thank Flag Link Mon Jan 20, 2014
The FHA appraisals of yesterday have been reformed and shifted from an emphasis on minor repairs. Many of us remember the difficulty of the FHA appraisal and it has had a dramatic change for the positive.
There is helpful, informative information regarding FHA repair and Inspection Requirements for existing properties and revisions to FHA Appraisal Protocol @ http://www.hudclips.org. I have had recent listings and sales that have sold with FHA programs that have transfered without a snag. Best of luck.
0 votes Thank Flag Link Thu Jul 24, 2008
I would of course recommend FHA be accepted on a potential purchase! If there is additional factors involved with the FHA such as downpayment assistance, then there are other factors consider when reviewing an offer, so do keep that in mind. Good luck to you!!!
0 votes Thank Flag Link Sun Jun 29, 2008
Definitely consider FHA since this is one of the best ways for a buyer with decent credit to buy a home. The guidelines and inspections are nothing to worry about, any good agent in the business for a while can pick out what FHA is looking for. Just remeber costs are negotiable and look at your net when considering an offer. I've been in the business 23 years and have done numerous FHA's. You might even consider a pre-sale home inspection.
0 votes Thank Flag Link Sun Jun 29, 2008
Jason,

I have a copy of the checklist appraisers use to evaluate a property for a FHA loan. It is a HUD form so it should be used across the board, irregardless of where the property is. If you like I can send it to you so you can get an idea of what the appraiser is going to look for.
As for seller conscessions, I believe you can do up to 6% but you cannot exceed the buyer's closing costs in any case, i.e. the buyer cannot walk away from the closing table with cash in hand.

Shoot me an email if you want a copy of the checklist. doug.watson at pittsburghmoves.com

Doug
0 votes Thank Flag Link Sat Jun 28, 2008
The thing I've found with FHA is that they want the proerty to be safe. Around here, that includes those "routine maintenence" things that a lot of people out off: scraping and repainting if there is peeling paint (and cleaning up the scrapings), repairing any broken windows or screens, making sure the electrical and plumbing are safe. FHA definitiely gives you a bigger buyer base - best of luck with it!
0 votes Thank Flag Link Fri Jun 27, 2008
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