WWYD? Buyers' FHA appraisal conditions

[stephlove]

I had put an offer in on a house, but after the FHA appraisal, found out the paint on the entire garage, windows, and soffet had to be scraped and repainted. The sellers said they wouldn't do it, so we offered to put in the labor if they would drop the price and cover the supplies. They wouldn't buy the supplies or drop the price, so we ended up walking.

But, I wasn't crazy about the house. I was settling for it.

FHA is a pain in the ass. If they really want the house, they may offer to do it themselves. I think replacing the entire roof is a huge thing on your part, so telling them to take care of the paint should be okay. If need be, maybe offer to buy the supplies.

[mrs.jacinthe]

Honestly, I'd tell them that if they want to do it themselves (or hire someone), you're fine with that, but if they say no, I'd walk away.

[candreco]

Jun 1, 2012 15:51:49 GMT -5 mrs.jacinthe said:

Honestly, I'd tell them that if they want to do it themselves (or hire someone), you're fine with that, but if they say no, I'd walk away.

Totally this. If you're not in a hurry to sell, I would tell them they can do it themselves or walk.

[druidp]

Thanks for the input, all!

We had our realtor take the following options to them: pay for and/or do the paint removal and re-paint yourselves, or we walk and you lose your appraisal money thus far.

They're getting it done next week.

I appreciate your help, and glad we aren't in a desperate situation - can't say the same for them, apparently after June 15 they have nowhere to live. Feel kind of bad for them, but obviously they're motivated.

[jenjen]

Jun 1, 2012 22:03:45 GMT -5 druidp said:

We had our realtor take the following options to them: pay for and/or do the paint removal and re-paint yourselves, or we walk and you lose your appraisal money thus far.

They're getting it done next week.

Glad it's working out! I'm sure they feel really bad since this all seems to be out of their control too. When we bought, our appraiser said the toilet had to be fixed (one was turned off because it wouldn't stop running) and even though we had a conventional loan, they wouldn't let it pass and approve the loan until it was fixed. We were buying 'as-is' from an estate and they would not put this $7 part on the toilet. SO their lawyers drafted a letter saying we could fix it. Then we had to pay $100 to reinspect it. And then we replaced the toilet right after we moved in! We felt really bad because it was such a stupid thing and we didn't really need it fixed.

Sidenote: sellers paying part of the closing costs are common in my area. We paid $3k for our buyers last year and our sellers paid $4500 towards our purchase.

[lolc]

Sellers paying for buyers closing costs seems to be a common thing in this market. Initially we were going to cover our buyers closing costs, but when the appraisal came in 15k short of what we both agreed on, we took that off the table.

I'm glad your buyers are taking care of the paint issue! FWIW, I'm pretty sure it is not the buyers requiring you fix this. It's the stupid FHA requirements. We had this same issue - FHA required that we fix the paint on the soffits of our house. We had a handyman come by. He scraped the paint that was "peeling" and then just repainted over. The inspector came by Friday and says it all looks good. He has to submit pictures to FHA but says he thinks it will be fine. Hopefully!

[vanillacourage]

Does the work have to be completed by close? We ran into an issue with that when we sold to FHA buyers.

[druidp]

Jun 3, 2012 21:44:13 GMT -5 vanillacourage said:

Does the work have to be completed by close? We ran into an issue with that when we sold to FHA buyers.

It does, but closing is on the 15th, and they're allegedly going to get the painting done by end of this week. So in theory it should all work out.

[Pom]

I am glad this seems like it has been worked out. GL with everything going smoothly.