The Federal Housing Administration doesn't make your home loan; it insures it to guarantee that the lender won't lose money. What's called an FHA loan is a mortgage made by a bank or other lender, but FHA insurance will allow you to make a lower down payment and get you a better interest rate. You have to play by the FHA rules, however, and your house must meet FHA minimum standards.
The FHA requires an inspection by an FHA-certified appraiser for all single-family homes. The appraiser completes a Uniform Residential Appraisal Report to describe the basic features of the house, such as number of rooms and square footage, and its general condition, noting anything that affects the livability, soundness or structural integrity. A report required for a condominium must include similar details, and it must confirm that at least 51 percent of all units in the building are occupied by their owners.
FHA minimums are defined in accordance with building codes, such as the Uniform Building Code or the National Building Code. These cover more than 250 standards. Any defects must be repaired or remediated before the loan is approved. Cosmetic problems, like worn flooring or damaged countertops, are allowed if they do not affect the soundness of the house.
Mechanical aspects, such as plumbing, electrical and heating, must be installed according to codes. Plumbing, including hot water heaters, must be in working order with no serious leaks. Electrical systems must be adequate for the size of the house, with no frayed or exposed wires or obvious defective outlets or fixtures. Each room must have a functioning heat source and the basic heating/cooling system must be functional, with no leaks or proper venting.
Foundations, basements and crawl spaces must be sound, with no major cracks or bulging sides. There must be no dampness, pooling water, evidence of past water infiltration or any mold or mildew. A crawl space must be large enough for inspection and maintenance and must be adequately vented. Any defects must be remedied by a certified contractor.
Roofs cannot have more than three layers of material and must have no signs of leaks or damage. A roof must display at least two more years of useful life. An inspector is required to check the roof from outside and from inside the attic, and any repairs must be made. The FHA requires a new roof if the roof already has three layers of material or if other problems are found.
Lead and Asbestos
Houses built before 1978 must be checked for lead paint and any peeling or chipping paint must be removed in accordance with to Environmental Protect Agency rules. Any damage to plaster or drywall also must be remedied in houses built before 1978. Any loose asbestos insulation must be removed. Asbestos on water pipes and heaters is permitted if it is permanently sealed.
The property on which the home sits must be graded to provide drainage of water away from the foundation, and the house must have serviceable gutters and downspouts. Any missing gutters must be replaced. Windows and doors must be in working order, although the FHA no longer requires replacement of cracked glass or damaged doors that are still functional.
Bob Haring has been a news writer and editor for more than 50 years, mostly with the Associated Press and then as executive editor of the Tulsa, Okla. "World." Since retiring he has written freelance stories and a weekly computer security column. Haring holds a Bachelor of Journalism from the University of Missouri.