November 17, 2019

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FHA Loan Reader Questions: Trouble With The Home Purchased With an FHA Mortgage Loan

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A reader asks, “My granddaughter purchased a home with an FHA mortgage, which has some serious physical problems. Can you give me the address of someone or some department, to which she can address these problems?”

Borrowers with FHA loan issues should contact the FHA directly by calling 1-800 CALL FHA.

In situations like these, there are some important considerations to keep in mind. As we address these issues, we should point out that we don’t know in this particular case whether the borrower did or did not take the steps we recommend below. All we know is what’s in the reader question printed above and our advice shouldn’t be taken to imply the reader did or did not take said advice–we mention these things for the benefit of anyone in the FHA loan application process.

Borrowers are strongly encouraged to pay for an optional home inspection by a trained professional when considering the home for purchase. Borrowers should never rely on the results of an appraisal alone, as an FHA appraisal is not intended to declare a home free from defects–the FHA appraisal simply establishes a fair market value for the property and insures it lives up to minimum FHA standards and local building code.

The appraisal is not an inspection–home inspections are far more complete and devote more attention to areas such as the roof, plumbing, foundation, etc.

When a home passes the FHA appraisal process, it has been reviewed by an FHA appraiser, but not INSPECTED. A home inspection is a borrower’s option and it must be paid for by the borrower, but the peace of mind you get once this process is over is well worth the expense. It’s a matter of paying hundreds now to save thousands later on.

Borrowers who do pay for an inspection but later find the home has serious issues should contact the FHA at once at the number listed above, but may also need legal advice in the event that fraud, neglect, or other problems become evident. The FHA won’t be able to give legal advice to a borrower, but can advise on whether FHA loan rules were violated and what recourse a borrower has, if any, in cases where loan rules were broken.

Do you have questions about FHA home loans? Ask us in the comments section. You can apply or get pre-approved for an FHA loan at FHA.com, a private company and not a government website.

 

 

Joe Wallace - Staff Writer

By Joe Wallace

January 23, 2014

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.

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FHANewsBlog.com was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

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