Do we have a legal case? As bank is lying to FHA about reason for denial letter so that we can get approved by another lender.

Asked by Lisa Grajales, Pinellas County, FL Fri Feb 5, 2010

FHA inspector noted mold issue on floor in bedroom due to french doors being installed backwards allowing water to get in on wood floor. The bank required us to fix (have doors taken out put windows in and all wood with mold damage replaced. in order to close. We did that with great reservations of putting money into something we had not closed on. They assured us it would be ok, as everything was done and we would close once repairs were done. So thats what we did. After all that they then said we now need to get mold remediator out for air sample. so we did that, and the reports on air samples showed some high counts Mold remediator inspector said it was know big deal to treat,so we ask the bank to get us a Lender Required repair letter to submit to seller (bank) they kept us hanging for 2 weeks and came back to say they were denying our loan because they didnt want to take risk. This is an FHA Loan and the Bank said they were going to put on report to FHA the denial was due to appra

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Alma Kee, Agent, Tampa, FL
Mon Feb 8, 2010
Just to be safe... get the new air sample from the same mold remediation company. Tell them that their previous mold report may cause you to lose the house and all of your costs incurred (inspection and appraisal). Ask them for the minimal cost to do any "remediation" to ensure the air sample will be sufficiently improved to prove to the FHA appraiser that the house no longer has any "mold" issues. Better hurry if this is a "bank owned" listing as it may already be too late and they'll sell to a conventional buyer. I hope there is a way for you to keep the contract while you sort this mess out....I had a buyer go through a similar FHA experience with a roof problem.... good luck! Alma
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Alma Kee, Agent, Tampa, FL
Mon Feb 8, 2010
Is it possible the mold air samples could be improved now that some time has elapsed after you replaced the wet/moldy flooring, etc? I'm thinking it may be worth the expense for an updated air sample. I believe it's true that an existing FHA appraisal "sticks" to the property. If you have enough money and sufficient FICO score you may be able to get a "conventional" mortgage (no FHA appraisal BS) with 5% down. Go to: and see if you can qualify. Also if you want to try they have less restrictive appraisers and they may know a way to dispute the previous FHA "mold" comments--especially if you have a better air sample report. Call:

Kristine Bredeau, Vice President
Mortgage Branch Manager

3725 West Grace Street Suite 300
Tampa, Florida 33607
Direct: 813-549-7234
Apply On-Line:
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Jane Grant, Agent, Aguanga, CA
Sat Feb 6, 2010
FHA insures loans they don't lend the money to borrowers. Because they are insurring the loan they have the advantage of obtaining their own appraisers. FHA appraisers are very picky and FHA has the final word on insurring the loan on the home. Sounds to me like they don't wan the risk. Mold is a very litigious matter. Homeowners have been on a trend to sue everyone when it comes to mold after they move into the home even though they were alright with it in the beginning.

Too bad you spent all of that money on the repairs but if the mold "air", test came back positive there is not much you can do.
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Loretta Buck…, Agent, Palm Harbor, FL
Fri Feb 5, 2010
It sounds as if the problem here is not getting the loan transferred to another lender, it's in whether or not you should be considering purchasing a home where the lender has such reservations!

One thing no one else has pointed out is that on an FHA loan, the appraisals and inspections follow the property--in other words, even if you chose to try for other financing elsewhere, whatever came up will stay, until someone can show the inspector that the remediation was done. You REaltor should know this--I am so sorry if you chose to attempt this on your own--this is just one example of what sounds like bad advice. It also sounds as if the home should not have been listed as ok for FHA financing--do you know whether it was?

Who from the bank "assured" you would be ok? Was, this (just a wild guess) by any chance or stretch of the imagination...Bank of America? Also, is this a foreclosure, short sale--who is the seller?

Good luck, Lisa--feel free to give me a call or email via my website if you have more questions!
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Jeanne Feeni…, Agent, Basking Ridge, NJ
Fri Feb 5, 2010
Hi Lisa, I would reiterate the need for legal advise from a real estate attorney. Hopefully, you have been working with one up to now. I have run into a situation which involved FHA repair requirements prior to close. Another question is whether this is a traditional or short sale. If the later, then it is possible that the "as is" state may leave you in the position of making repairs to satisfy a lender requirement. But this is speculation, you know the details best, and an attorney is the only one that can advise you on what to do next.

I'm sorry you have hit this bump and incurred this expense and wish you success in resolving this.

Jeanne Feenick
Unwavering Commitment to Service
FInd NJ properties at
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Spencer Janke…, Agent, Cottonwood Heights, UT
Fri Feb 5, 2010
Definetly get some advice from a Real Estate attorney, I think you have two way to go with it. Ask the attorney to look into who gave you the advice to actually do the work prior to closing?? And then the bank issue..

I would love to hear what you find out...
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Anna M Brocco, Agent, Williston Park, NY
Fri Feb 5, 2010
Your best source of advice is an attorney specializing in real estate--most professionals do offer a free consultation--what is your agent advising.
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Elaine Cloud…, Agent, South Pasadena, FL
Fri Feb 5, 2010
Both Pamela and Myke have given you sound advice. This is a matter for a real estate attorney. We truly hope you are working with a licensed Realtor in this matter.

Good luck in resolving the issue.


Elaine Cloud Goller
Realtor® and Certified Short Sale & Foreclosure Resource (SFR)
Keller Williams Realty - Gulf Coast
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Pamela Cohn, Agent, Clearwater, FL
Fri Feb 5, 2010

First Myke is correct when she said "we are not allowed to practice law without a license". This is definitely a question for a Real Estate Attorney.

I do have another question for you...were you working with a Realtor? When you are signing loan documents for a home, there is a form stating that you have not done any work on the home prior to closing that could result in a lien. I am confused as to why the BUYER would be asked to make ANY repairs prior to closing or why an agent or even lender (yours) would not warn against it. That is either done by the seller, or negotiated and funds are held in escorw for the Buyer to do the repairs after closing, or it's negotiated off the price. Something is missing here. Seek out a legal opinion for an answer and your protection.


Pam Cohn
Broker Associate, GRI, CDM
Real Estate Consulting, Marketing & Sales
Prudential Tropical Realty
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Myke Atwater, Agent, Santa Rosa Beach, FL
Fri Feb 5, 2010
Dear Lisa,

This is a question that is best answered by a real estate attorney, and it would be not only a disservice to you for us as realtors to weigh in on this question. We are not "allowed to practice law without a license" and to answer your question in any way other than referring you to an attorney would be against our regulations. Best wishes to you in resolving this matter, but do engage in a consultation with a real estate attorney for your own protection. If you entered into this transaction without the use of a realtor, it is highly probable that you would not be in this predicament. Avoiding this sort of situation is what we as professionals assist you in doing. In the future, after you get this straightened out, I would highly recommend that you consult a realtor to continue on with your search for an appropriate home.

Myke Triebold, GRI, LMC
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Dianne Hicks, Agent, Rancho Bernardo, CA
Fri Feb 5, 2010
These are things that JUST MAKE ME A MAD WOMAN!!! I am so sorry to hear this. Write a personal letter to bank and ask listing agent to approach one more time with letter. It is not over till it's over! Tell them you have been committed ever step of the way and you would will push to get this resolved. Make it a point that you are qualifited and it this can and will be resolved. Get it in writing and make it clear that Mold Remeditor inspector said not big deal and submit with letter. Get a time line and make FHA step up to the plate and not drag their feet. You have nothing to loose by taking this approach.

I wish you the best of luck and hope you have a compassionate negitiator on the other end. If not, I hope Carma bites them in the rear!!!
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Dallas Texas, Agent, Dallas, TN
Fri Feb 5, 2010
Sorry hear about all this odd now obtain a loan may not happen.

Confer with a real estate attorney.

However your buyers agent why did not recommend search for another home, if you place work into any home prior closing you are risk not obtaining a loan.

Sorry read about this.

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