How Livable Is Your Dream Home?
October 30, 2024
Did you know that FHA loans have minimum property standards to ensure the home is safe and livable? Those standards require the home to have an “economic life” for the entire term of the loan so you can freely sell the property later on if you choose to do so.
FHA minimum standards for homes secured with FHA mortgages include a review of the property's important features, including the electrical system, plumbing, roof, and foundation.
Mechanical Systems In The Home
FHA loan rules in HUD 4000.1 require that a home's heating, cooling, plumbing, and electrical systems be in working order and safe to use. As we’ll explore below, those systems must also be sufficient to serve the property they are installed in.
The FHA appraisal process may flag issues such as visibly faulty wiring, a leaking water heater, or an inefficient furnace. In cases of deficiencies, your seller may be required to repair or replace things in the home that do not meet FHA minimum standards.
Roof Issues
The roof is one of the most critical components of the home. HUD 4000.1 has noted in the past that the roof should have a remaining physical life of at least two years. If the appraiser notes issues with the roof, these may be required to be corrected before closing time.
Lead Paint
One important aspect of FHA minimum standards for all homes purchased with single-family FHA loans? Lead paint. While not always a health hazard, chipping or peeling paint can indicate deferred maintenance and moisture problems.
Peeling paint is considered a health and safety issue, and corrections may be required as a condition of loan approval. This is typically true at both the state and federal regulatory levels.
FHA Loan Requirements
FHA loan regulations include language such as "The water supply system must be adequate for the needs of the dwelling."
All home systems must meet this guideline. The home’s systems should be powerful enough to serve the entire property, not just a few rooms. That goes for water, septic, electrical, HVAC, and related systems.
FHA Loan Articles
February 17, 2025The federal government backs FHA home loans, which allows participating FHA lenders to offer lower down payment options and more lenient credit requirements. How much do you really know about your FHA home loan options and how they compare to other mortgage choices?
February 13, 2025For many college graduates, student loan debt is a concern. A common question is how this debt impacts the ability to buy a home. This Q&A explores the relationship between student loans and FHA loan approvals. How much do you know about how your student loan debt affects your ability to be approved for a mortgage?
February 12, 2025Choosing between FHA and conventional home loans can be daunting for some first-time home buyers. What are the concerns between these two programs, and what does each one offer the borrower? We examine some of the key issues in our question-and-answer session about FHA mortgages versus conventional loans.
February 11, 2025Established in 1934 as part of the National Housing Act, the FHA's primary mission is to stimulate the housing market by providing mortgage insurance to lenders. This insurance reduces the risk associated with lending to borrowers who may otherwise be considered higher risk, encouraging lenders to offer more favorable terms, such as lower down payments and more flexible credit requirements. A key element of the FHA program is its commitment to fair housing, which is deeply rooted in the Fair Housing Act.
February 10, 2025How much do you really know about the home buying process? One major factor in protecting your new investment is knowing how the title search process works and why you need to have one done. This quiz will assess your comprehension of what a title search entails, why it's so important when using an FHA loan, and how it protects you as a buyer. From identifying potential liens to guaranteeing clear ownership, a title search plays a critical role.
