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Sarah, Both Buyer and Seller in

What does an FHA loan mean for a seller?

Asked by Sarah, Sun Nov 18, 2007

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5
Sarah
You profile does not say where you are located. FHA does have loan value limits, so if you were in a "high cost" area, like Glendale, California (my market), it may not be applicable.

Also, like any great government program, FHA has fairly strict property condition guidelines (so a fixer probably would not qualify), or a home with a lot of deferred maintenance. So if your home needs some work, you'd probably want to consult with a Realtor about what you'd need to do to have it ready for market. if FHA loans are common in your area, I would think they'd be able to answer your questions.
1 vote Thank Flag Link Sun Nov 18, 2007
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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I would concur with both the earlier answers. The seller may have slightly more costs, but they shoudl be minimal, but the home appraisal will focus on safety issues as well as value. My last FHA was no different and had no writeups that my conventional sales homes have had and my seller didn't pay a dime more than she would have paid anyway if it had been a conventional loan (the buyer was using a good mortgage company and a good title company that didn't tack on fees that FHA didn't allow)
Web Reference: http://www.yourstlhome.com
1 vote Thank Flag Link Sun Nov 18, 2007
Under FHA rules, there are certain costs that the buyer may not pay, which means that the seller will have to pay them on behalf of the buyer. Sometimes, the buyer will increase the purchase price by the amount that the seller has to pay to offset the increased seller expenses, but in a buyer's market, this may not happen. Some of the fees that a buyer may not pay under FHA rules are (Association Transfer Fees,
Buyers' Loan Processing Fee, Buyers' Loan Document Fee, Sub-Escrow Fee, Tax Service Fee).
I hope this helps.
Best regards,
Ute Ferdig
Web Reference: http://www.theMLShub.com
1 vote Thank Flag Link Sun Nov 18, 2007
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
MVP'08
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In my experience, If your home is in good shape their isn't much difference from a conventional loan. The big difference is that when the home is appraised they truly do inspect for any problems that could be dangerous to the new homeowner. For instance peeling lead paint, cracked foundations, electrical issues, etc. A loan will not be granted unless the issues are taken care of . It forces the seller to correct these issues before closing .
1 vote Thank Flag Link Sun Nov 18, 2007
It could mean your home may need to have some additional improvements, and you may have a few adddional closing costs .
Web Reference: http://www.iansellsnola.com
0 votes Thank Flag Link Mon Nov 19, 2007
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