FHA and Cracked Windows

by Michael on February 8, 2012

One of the major challenges homeowners face when having one of the sale of their home go FHA financing, is what work orders is the appraiser going to call for. With Fannie Mae and Freddie Mac in everyone’s crosshairs, FHA financing is only going to become more prevalent within the housing market. I would highly recommend that Realtors become familar with HUD’s Mortgagee Letter 2005-48, and FHA’s three S’s.

Small Window Cracks Don’t Need Repair

FHA no longer requires that all cracked or broken windows be an automatic repair. Requiring a window to be repaired can be challenging for an appraiser, because what is considered safe and just a maintenance item for one appraiser, may be considered a danger to another. FHA requires that all deferred maintenance be noted within the appraisal report, along with a photo, so the underwriter can make the final decision if it’s in doubt. This window has such a small crack that it wasn’t probably worth mentioning, but I did anyways just to CYA. The underwriter agreed, and no repair was necessary.


Some Window Cracks That May Need Repair

It’s tough to see, but this crack is much larger, however, it was dual pane glass and the owner could operate the window without getting hurt. That doesn’t mean that someone on the outside touching or moving the window wouldn’t get injured. On this appraisal I just reported it to the underwriter; “That this window has the potential for injury,” and let them make the call. The underwriter ended up requiring that this window to be repaired.

The Obvious Window Cracks That Should Be Repaired

This window is pretty much a no-brainer, and would be required to be repaired. It doesn’t meet FHA’s MPR (minimum property requirements) guidelines, which is to protect the improvement (house) from the outside elements, and the safety of the homeowner. However, the underwriter does have the final say, but most likely will require that it be repaired.

The bottom line is that if you have any window that is cracked or broken, and has the appearance of being a safety hazard, have it repaired before listing the property for sale. This will keep your sale from being delayed at the last minute by an FHA work order.

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