We are going to be completing a walk through on a home we are purchasing in 2 weeks. What exactly are we going to be looking for? How long will the walk through take? How will we be sure that the repairs we requested are taken care of correctly?
Congratulations on your new home! The walk through should take about 15 minutes to ½ hour depending on the size of the home and the number of repairs you need to check. You will check to be sure the oven and stove top are functioning correctly, you will check the refrigerator (if included) and perhaps run the dishwasher through a short cycle. You will want to run the water at all sinks to be sure there are no leaks and to be sure you have hot water. In addition you will check the faucets on the tubs and showers. Flush all toilets. You will look at the walls and the flooring to be sure there aren't any additional stains or holes that were not previously there. Be sure that everything looks as it did when you had the home inspection. Be sure to turn on the heater and make sure that it is operational. In addition do not forget to walk around the outside of the property and check for down trees or limbs that may have affected the house. Go into the basement and check for water issues. You also want to be sure that everything is cleaned out of the house and if there is a garage check the garage door openers if applicable. Be sure to look at the ceilings to be sure there were not any leaks and at the roof to be sure no shingles have been damaged since the agreement of sale was presented. Check in all closets and cabinets.
As far as the repairs that you requested, your Realtor can request the receipts for the work completed prior to your walk through. In fact many Realtors put in the Reply to Inspection that the Seller will provide receipts to the buyer/buyer agent 3-5 days prior to settlement. If the repairs are not obvious such as wires in junction boxes, GFCI's installed, etc. you may want to consider asking your home inspector to accompany you on the walk through (they will charge for this service) to be sure the repairs were completed correctly. However if you have the receipts from a licensed contractor, plumber, roofer and/or electrician you should be fine.
There are a few homes on the market that I would like to see. I am utilizing FHA financing and my Realtor has told me quite a few times that the homes I want to see would not work with FHA financing. She states that sometimes the homeowners do not want to sell FHA due to repairs that would be required. Do I have other options?
Absolutely you do. Many sellers have not sold a home in quite some time or they hear about how difficult it can be to deal with an FHA loan. However so many potential buyers in the market are utilizing FHA financing and these sellers are missing out on great opportunities to sell their home. FHA is not as difficult as it used to be. Prior to this year FHA required a roof cert, a heater cert and they were very particular about what they wanted to be completed. They want to be sure that the home the buyer is purchasing is in good condition and safe. They no longer require a roof cert or a heater cert unless they have some reason to think there may be a problem. Also FHA now requires that any home on Well Water be hooked up to Public Water if it is available and if the cost to do so is 3% less than the cost of the home or less. For example if the home is 100,000 and it would costs 2900.00 to hook up to public water FHA is requiring that the homeowner do so. If the costs is over 3% of the sales price and/or public water is not available in that area then there is not an issue. Also there is a very specific FHA water test necessary and the water must be clear of any problems. FHA will also want any chipped/failing paint to be scraped and painted, they will want GFCI's at all water sources (counters on kitchens, in bathrooms, at laundry area, outside electrical outlets and in garages), railings on stairways, no broken or cracked windows as well as a few other repairs that may be necessary. These repairs must be completed prior to settlement. If the homeowner refuses to do the repairs or they state up front that they are unwilling to do the repairs the buyer certainly can pay to have the repairs completed or complete them. This would have to be an arrangement between the buyer and the seller. If you are willing to do that I would speak to your Realtor about calling the listing agent on the homes you want to see and letting them know that you are utilizing FHA financing and are willing to complete any repairs required due to the appraisal. This should work.
There is also FHA203 financing. This is more or less an FHA renovation loan. Simply put if you are purchasing a home for 100,000 and the required FHA repairs as a result of the appraisal are $10,000 you would then be borrowing 110,000 minus the 3.5% down payment. The $10,000 is put into escrow and the contractor performing the work would then be paid from that escrow once the work is completed. Speak to your mortgage lender about this option and that would open many more doors for you.
I wish you the best of luck in your home search! What a wonderful time to be purchasing!
Ask The Realtor is brought to you every Saturday by The Phoenix, Phoenixville's Local Newspaper, and Jennifer Daywalt, Phoenixville's Home Town Realtor, and the Top Realtor for 5 years! Jennifer not only works in Phoenixville but lives here! Jennifer can be reached at Re/Max Results Realty at 610-489-7355 or directly at 610-999-7693. All questions will be answered every Saturday and questions can be emailed to Jennifer at Sellinghomesjenn@aol.com. More information can be found at www.JenniferDaywalt.com!