FHA appraisals and roofs. - Posted by Mike

Posted by ken in sc on March 01, 2001 at 13:17:16:

there is not a big chance being taken. I just like to know my numbers when bargaining. And if you don’t know about the roof being replaced or not, and what that cost might be, then you as the seller cannot figure your net proceeds. With FHA or even a home inspection, I like to contractually agree to an amount I will pay. That usually limits the negotiation after the negotiation that often cuts our profit.

FHA appraisals and roofs. - Posted by Mike

Posted by Mike on February 28, 2001 at 13:51:32:


I have a house that I’m getting ready to buy and rehab. In fact, I have an end buyer that can’t wait to buy from me when I’m done.

I have all my interior and exterior work accounted for, but the one thing I’m uncertain about is the condition of the roof. My buyer will be going FHA and I’m wondering if the FHA guidelines will not allow a roof that has over a certain number of layers. At first glance, I see that’s there are probably three layers of shingles, but the last layer looks fairly new (probably 3 years old). I asked the local dept. of bldgs. and they don’t have any restrictions on the number of layers that a roof can have. Does FHA care as long as the roof is in generally good condition.


FHA requirements - Posted by Fred

Posted by Fred on March 01, 2001 at 14:54:35:

As an appraiser I can tell you that FHA will hold the appraiser responsible for reporting inaccurate information and the appraiser may be risking a law suit and suspension from the FHA roster if that roof leaks within 2 years of purchase. Having said that, I know that many appraisers don’t follow the rules strictly because they don’t want to be perceived as “killing the deal.” The following is the exact wording as it appears on the VC form:

“HUD/FHA requires that the roof have at least 2 years remaining life. If the roof has less than 2 years remaining life, then the appraiser must call for re-roofing or repair. The condition must clearly state whether the subject is to be repaired or re-roofed. FHA will accept a maximum of 3 layers of existing roofing. If more than 2 layers exist and repair is necessary, then all old roofing must be removed as part of the re-roofing.”

My advise is to have a roofer who does FHA certifications inspect the roof. If there are 3 layers and it has a life of over 2 years then your OK. Show the certification to the appraiser when he inspects the property and that will satisfy him.

Re: FHA appraisals and roofs. - Posted by JPiper

Posted by JPiper on March 01, 2001 at 01:18:10:

My guess is that your local codes do not permit over 3 layers. I think you’re OK with FHA with 3 too, as long as it’s in good condition.


As an FHA appraiser… - Posted by ken in sc

Posted by ken in sc on March 01, 2001 at 07:29:39:

I can tell you that you are taking a chance. What I mean is that some appraisers are better trained/more experienced than others. Some will think 3 layers are bad while others may not even notice the 3 layers. I know this is not the answer that you want, but it is the truth.

The FHA rules for appraisers say that if the appraiser thinks the roof will last longer than 5 years, it is OK. Therefore, it is a judgement call for the appraiser. If he is not sure, he will call for a “roof inspection” by a licensed roofer - then the roofer will make the call. He is even more likely to want to put a new roof on it as he might get the work, and he will be held accountable if he says it is OK and it leaks 5 months after closing.

So, you can either go ahead with a new roof before and add it to the price, or put a clause in the contract that limits how much the seller wll pay toward any repairs.

Re: As an FHA appraiser… - Posted by JPiper

Posted by JPiper on March 01, 2001 at 09:42:48:

I basically agree with your post…except the part about “taking a chance”. I don’t think there’s any particular risk here. You can tear the roof off upfront, or you can wait until an appraiser has looked at the property. If he requires a roof certification, and a roofer won’t give it one, then you’re no worse off than had you replaced the roof upfront.

Frankly I think the consideration is whether the roof has a significant useful life ahead of it. “Three layers” in and of itself does not make it a bad roof. And if the roof is in good condition I don’t think you’ll have any trouble getting a roofer to certify it.

On the other hand, one valid consideration in my mind is whether a new roof adds value. I can think of some neighborhoods where it might. Some of the older neighborhoods that I have dealt in things like new roof, new plumbing, new electrical, and new HVAC set the house apart, add significant value. They also tend to be excellent marketing points versus other houses in the area.

Limiting the $$ value of repairs you agree to make is wise…BUT, the bottomline is that if you want to sell the house, and the roof doesn’t pass, you’re going to have to pay for it if you want to sell FHA…because the Buyer is not going to have any money to help with this. That’s why he’s going FHA to begin with.