The information listed below came from an appraiser who spoke with an FHA HUD appraisal processor working with the Department of HUD directly regarding HUD Guidelines. I thought this might help explain how an FHA appraiser will be looking at properties with "liveability issues". "Subject To" means that the repairs or missing appliances/ fixtures will have to be completed and the property re-inspected (at an additional fee) before loan documents can be drawn.

Listed below are just a few (not all) of the major questions asked relating to FHA appraisal reports.

Regarding carpet. If the carpet is removed it must be replaced and the report made “subject to” due to it is a health and safety issue. The same goes for soiled, stained and cat urine carpets. This according to him is a health and safety issue and the carpets must be replaced and the report made “subject to”.. If concrete flooring is exposed where prior carpet has been removed then the report must be made “subject to” due to health and safety issue.

Also I clarified. Per HUD guidelines a stove that is a pullout-slideout is not considered a built-in stove and is not required. A dishwasher with counter above is considered built-in and is required if missing. The same goes for a microwave that is built-in. If it is missing and has the holes showing as to where it was, then it is required if missing and the report is to be made subject to.

All utilities must be on and tested at the time of the inspection. Toilets flushed, faucets tested, outlets tested, light switches tested, air conditioner and furnace tested, water heater tested for hot water and water pressure tested.

All outlets and light switches must have plate covers or the report must be made “subject to”. Exposed wires are a health and safety concern.

Homes built prior to 1978 will be made “subject to” if chipped and peeling paint is found present. (lead based paint concerns).

Pools are required to be in operating condition with functioning pumps and filters. Reports must be made “subject to” if pool is empty, green and stagnant, low water level or pumps are not functioning properly.

Broken windows will require replacement and the report must be made “subject to”.

Info courtesy of Mary Ellen Kohut, The Mortgage Advantage, Inc.1720 E. Warner Rd. Suite 1Tempe, AZ 85284


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Erika Madsen
Real Estate Consultant
Re/Max Power Realty
"Your Advisory Team" Founder/Manager
480-695-6572

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