Financing in Fort Wayne>Question Details

Jared and Am…, Real Estate Pro in Fort Wayne, IN

When approving financing on a property that needs repairs, what would cause FHA to NOT approve a loan?

Asked by Jared and Amanda Christiansen, Fort Wayne, IN Mon Jan 26, 2009

I have a client that wants to buy a house that has minor things wrong with it such as some damage to the hardwood floors, needs a new furnace, upstairs drywall needs finished, etc. Once she replaced the furnace the house is liveable. I am having a hard time getting an answer from my lenders on the following question. How much disrepair is too much disrepair for FHA guidelines? Thanks!

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I had a client go through this last year. We had structural issues (some major termite damage repairs to do to framework of the home), replaced heating/ac, new appliances, 1 new window, new flooring and of course painting. The bathroom was a total tear out except for the bathtub. My client was going to go the short form 203, but when the underwriter got one of the repair bids and heard possible "structural", it turned into a full blown 203 loan. Took much longer to close, lots more steps for my client to go through, but eventually we closed and completed it all. We worked through a lender in Fort Wayne and he was TERRIFIC. If you want more information on this person, please get in touch, I will happily recommend him. You can em me at
1 vote Thank Flag Link Mon Jan 26, 2009

Not sure where you got your info (or maybe FHA has changed the rules??), but my clients roof was leaking so bad due to termite damage in the bathroom that we had to rebuild the walls from the studs out. In fact, in the whole back wall of the house there were only 2 2x4s that were whole, the rest were almost totally destroyed by termites. There was no refrigerator at all, the range was not working and the dishwasher was also not working.
All the kitchen cabinets had to be removed and some rebuilt from the back side, again due to termite damage. We were under the gun for time too, all work had to be wrapped up in 90 days or less once we got started.
It was quite an experience, to be sure!
0 votes Thank Flag Link Tue Jan 27, 2009
This has been tricky for me too! I know from experience that the roof cannot leak and the appliances also need to be working. Check the attached website for details.
0 votes Thank Flag Link Tue Jan 27, 2009
Thank you both for your answers! I really appreciate it! Jody, I see your answers a LOT on here, thanks for sharing your knowledge with so many! :)
0 votes Thank Flag Link Mon Jan 26, 2009
Thanks for your post. By the sounds of it you client will need to get the FHA 203 rehab loan. This allows to purchase properties in need of repair the ability to get the home and the funds escrowed to complete the repairs.
Repairs must be completed by a FHA repair person and it is a much longer process for approval. While two types of 203 are on the market the only ones with any real use is if repairs are under 35k.

Hope this helps
0 votes Thank Flag Link Mon Jan 26, 2009
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