The FHA considers the value of appliances like ovens in their property appraisals.
The Federal Housing Administration's job is to provide mortgage insurance on housing loans. Mortgagees provide appraisers with financing data for the property. For FHA-approved loans, some appliances and personal property are considered part of the home, such as refrigerators, dishwashers and ovens. Because these appliances are included in the sale, the FHA has set guidelines for evaluating them.
What Is Considered
Appraisers of properties being considered for FHA-approved mortgages must make note of appliances in the home when the inspection occurs and whether these appliances are personal property or part of the real estate. Ranges, refrigerators, dishwashers, microwave ovens, washers and dryers can be considered part of the real estate because they are items that typically come with the property, according to the FHA. If these items are considered personal property rather than real estate, the appraiser needs to make a dollar-for-dollar reduction in the mortgage value unless the appliances are worthless.
Damage Caused by Appliances
If the appliances have been removed from a property, there may be damage to the floor, walls or other fixtures. The appraiser should treat the damage as deferred maintenance and include the value appropriately in the valuation process, according to the FHA. The value of the missing appliances will also be subtracted from the property value.
Appliance Repair
If the appliances will remain in the home as part of the sale but are in need of minor repairs, the FHA encourages borrowers to use its Streamlined 203(k) loan product to get the money to make the repairs themselves. The loan is specifically designed for these repairs. The cost of the repairs will have already been deducted from the mortgage value and the loan program allows needed repairs to be made with little hassle and financial discomfort.
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