I did an inspection three weeks ago. There were things wrong and the client got the report.
I get a call today from a lady at Wells Fargo saying that the underwriter wants everything fixed that was on the inspection report.
Here is the list:
***** APPROVAL CONDITIONS ******
O305 Repairs required from the Home Inspection Report (to be verified by the inspector or a licensed professional):
O306 1. Repair the areas of the patio that are leaking and the damaged stucco.
O307 2. Repair the garage lower vents that were capped off and replace screens.
O308 3. Repair or replace exterior side garage door and frame.
O309 4. Repair or replace defective garage door opener and the defective garage door.
O310 5. Repair or replace all flooring that has buckled (safety hazard).
O311 6. Repair or replace all defective doors and/or locks (potential safety/security issue).
O312 7. Licensed plumber to address and repair/replace all defective plumbing issues.
O313 8. Licensed electrician to address and repair/replace all defective electrical issues (there are improper connections, broken electrical covers, unattached and/or exposed wiring, failed GFI, and other potential electrical shock/fire hazards present).
O314 9. Repair or replace defective cooling system.
O315 10. Install anti-tip bracket at range.
O316 11. Repair leaking washing machine and remove any pooling water (if present).
O317 12. Inspect, repair or replace defective pool equipment (possible safety issues).
O318 13. Licensed roofer to repair/replace defective roofing.
O319 14. Evidence of pest/lizard droppings in subject. Remove and exterminate.
HUD/FHA, USDA and VA continues to require repairs for items that potentially affect the soundness or structural integrity of the property, the safety or health of the occupants, and the security or the marketability of the property.
If you didn’t call it, The appraiser would, or should. I know I would.
Yup, If there is a home inspection report and HUD gets a hold of it, they will use it to determine items needed for repair. Doesn’t matter where the info comes from, ie. seller disclosure, mortgage broker, lender, agent or buyer. Those would be items the appraiser should report as well. Appraisers follow HUD 4150.2 handbook as well as HUD 2005-48 mortgagee letter for FHA appraisals.
I’ve seen the same thing, mortgage person/lender/broker/processor, requiring items listed in the inspection report be repaired prior to loan approval or closing.
The USDA rural loan is typically the most demanding.
Once a seller’s agent called and was very upset that I stated a home was sturcturally unsound or unstable. Of course that was not in the inspection report; the report did note (along with other things) the main support beam was not fully supported by a set of concrete block piers (the beam missed the piers by half the width of the beam).
I always tell the client to read the entire report and then foreward it to the USDA loan department; but normally they foreward it first and then read it.
In the case mentioned above, the loan person/processor/broker deemed the home structurally unsound and in need of repairs prior to the loan being aproved.
I sometimes advise the buyer to consider whether they want to release the report to the mortgage company unless they want this to happen. I also sometimes get called to go back and reinspect the repairs (FHA compliance inspection) for the lenders.
Is that required? I always tell people the inspection report is their confidential info and do everything possible to not let one letter of it reach the loan officer.
Banks are so backwards, they demand repairs to “protect their investment” and then let foreclosures go down the crapper in order to save a couple hundred bucks on utilities.
Sounds like that loan is going through some type of grant money. Possibly the NSP program. The banks determine what they want fixed and the loan will not close until all the items are taken care of. Bank Atlantic was famous for that. Maybe Wells Fargo is entering that arena.
Maybe she should opt for a 203K loan if there is no grant money involved. That way she can borrow the money to fix the problems, provided she qualifies.
That is what I remembered Bill. I’ll be talking to the loan officer today to see what has happened so far. Perhaps there is a way to get this resolved. My clients are worried that they will lose their deposit money.