What they are looking for in appraisal?

[chan85]

I am currently pending an appraisal for the house I put an offer in on. We had the inspection done about 2 days after the initial offer, and we are now a little over 30 days since then because it was a short sale and Chase just approved my offer it last week.

The inspection mentioned a few items- PVC piping potentially needs to be replaced and securing the deck- which I have no problem doing in the next few months after I move in. The home is sold "as is", which I was comfortable with after the inspection.

But in reading other people's experiences, I am concerned now we will be delayed in closing after the appriaisal. Will the appraiser be checking many of the same things and demanding they be fixed before closing? Or are they just there to determine the appropriate price on the home in comparision to the neighborhood and what my offer was? I have literally NO additional time for closing since I have to be out of my current home on the 31st....and now I am worried there will be a delay due to something in the appriaisal report.....

[jules0580]

the appraisal will give a value of the current home in its current condition, so it will reduce the value if there are alot of repairs needed etc. But not the same as an inspection. However FHA and VA appraisals will require some things be repaired before closing such as paint chipping etc.

[chan85]

hmm paint chipping? i'm going to have to look and see what things they look for a little harder.... there is not paint chipping, but they have some kind of like cement siding around the basement that is flaking off, hope that doesn't cause a problem.....

[chan85]

seems i answered my own question with a quick google search....only thing i think i am concerned with is wiring, think there was some shady wires in the basement that need to be capped properly....

Source: http://homebuying.about.com/od/financingadvice/qt/FHA-Repairs-to-get-an-fha-loan.htm

Types of FHA Repairs That Must be Completed Prior to Closing an FHA Loan

• Peeling paint in homes built before 1978.
• Unpainted downspouts and broken rain gutters.
• Rotting out-building in need of demolition.
• Exterior doors that do not properly close and open.
• Exposed wiring and uncovered junction boxes.
• Major plumbing issues and leaks.
• Inoperable HVAC systems.
• Leaky or defective roofs, roofs with a life expectancy of less than 3 years, composition over shake.
• Active and visible pest infestation.
• Rotting window sills, eaves, and support columns on a porch.
• Missing appliances that usually are sold with a home such as a stove.
• Bedrooms without minimize-sized windows or bedroom windows with bars that do not release.
• Foundation or structural defects.
• Wet basements.
• Evidence of standing water in the crawl space.
• Inoperable kitchen appliances.
• Empty swimming pools, pools without a working pump and pools with mosquito fish.
• Ripped screens.
• No pressure relief valve on water heater.
• Leaning / broken fence.

Types of FHA Repairs That are Not Necessary to Fix Before Closing

• Peeling paint in homes built after 1978.
• Cracked glass in windows.
• Minor plumbing defects such as a dripping faucet.
• Missing handrails.
• Damaged wall coverings in homes built after 1978.
• Worn out carpeting or defective floor finishes.
• Beat-up or damaged exterior doors that still open and close.
• Trip hazards such as heaving sidewalks.
• Removal of debris under the house.
• Lousy workmanship.
• Evidence of previous or inactive pest infestation.
• Replacement of flat roofs.
• Testing of wells, unless required by local jurisdictions or water is suspected of contamination.

[Edited to add the link to source.  Material subject to copyright protection must be properly attributed.]

[JusdoNit]

OP thanks for the list

[Anonymous]

My appraiser had a list of repairs that would need to be completed in order for the home to truly appraise at the value he stated. "Subject to repairs, the home is valued at ______" basically. Mine were "remove/replace damaged screen on back porch, repair cooktop and oven, scrape paint off front porch conrete, fix windowsill and match the paint, fix attic latter, remove/replace front porch railings." Thought I'd add mine in there since these aren't listed in the appraisal list but adds monetary value to the appraisal price. We did have to have these repaired per our lenders request to reflect the full appraisal value.

[Jazzzy]

Other examples of what can be called are health and safety hazards, such as carpets that have been soaked with pet urine. In that case, for example, they can require that all carpeting be removed and the underlayment be replaced or sealed.

It is the appraiser's duty to call such items.

[chan85]

Sorry about the missing link! Well, I can only hope the appraiser doesn't find too much that needs to be fixed since its sold as is, I know the seller isn't willing to fix anything and I don't wnt to spend a bunch of money when it's not officially MINE yet..... After appraisals and such, can you go bck and renegotiate price if needed- say if repairs are several thousands of dollars?

[jules0580]

Yes if the house appraises for what you are paying based on things being fixed then you can say well without these being fixed the house is worth less, and you wont be able to get a loan for the full amount if its worth less so they would have to negotiate that with you.

[chan85]

So for example, what if they say the house is worth $100k with repairs, but $97k without, however my loan is only for $95k, will they still require repairs??