Throughout the Phoenix area, FHA loans have become a favorite of many homeowners – and not just first time home buyers. The reason of this surge in popularity is that many other types of loans have dried up in the credit crunch.
But if you are thinking about financing your home with an FHA loan, you will want to be aware of some of the common problems with FHA appraisals.
Typically, FHA has higher appraisal standards than conventional financing, and generally speaking the house has to be in better condition than conventional financing rules require. Â If you are negotiating for a house that is a short sale or a foreclosure – (or maybe just even in one of the historic districts in Phoenix), it is common that these homes need to have some work done and many times a “regular” FHA appraisal will come back negative because the work has not yet been done.
The main issues that FHA appraisals have problems in the Phoenix area include:
- Plumbing
- Electric
- Foundation
- Water Heater
If there are any issues with these utilities you may not be able to use a normal FHA mortgage — that is the bad news. The good news is that you may be able to use a special type of financing – the 203k streamline mortgage – to help you still finance the house.
The FHA 203k streamline is designed for homes that “need a little work” and we are experts at helping people get FHA 203k financing as well — which is all too important in today’s world where every other house for sale seems to be a foreclosure.
