Who is responsible for repairs?

Question

We are in the process of buying a house. The FHA appraiser found a slight problem that needs to be fixed in order for the loan to be approved.
The wire running from the electric meter outside to the fuse box inside is "weathered" and needs fixed.
Problem is, the house is a short sale, and owner refuses to do any repairs. Also, the gas and water was not on when the appraiser went through, so he wants to reinspect when those are turned on, and the wire is fixed.
What I am wondering is who should fix this wire? I doubt the bank will do it, but I don't feel I should have to pay especially if we don't know if the appraiser will find problems with the gas and/or plumbing. If we fix the wire, and some other major problem arises...we are out that money.
If we agree to pay to have the wire fixed, can we ask that the cost be deducted from the price of the house?

Also...is it standard for the buyer to have to pay for the appraiser to reinspect the house due to gas/water not being on? I feel it is not my problem...they should have checked to make sure all utilities were on prior to going out there. But, I was told I have to pay. (I'm checking with my lawyer)

Answer 1

The sellers usually pay for repairs that need to be done, if they want to sell the house to you. An FHA loan approval is very picky. You could also see if they would go in half on the repairs. It really depends on how bad you want the house and how bad they want to sell it.

As for the appraisal, the first one was incomplete so they should just finish the first one, it should be just a one time fee talk to your real estate agent they can find out the details on that... but you shouldn't have to pay twice.... Good Luck!!!!

Answer 2

BS BS BS Thats what I think and so should you as far as the electric wires. Now you said the FHA appraiser was the one who said this needed to be fixed? What is his credintials as far as home inspections? He is a appraiser NOT a home inspector. His opinion is just that. His opinion. The FHA inspector would be the one to point this out. What did he say? And how do you findout the wires are weathered anyway? The electric wires, other than the ends in the box are encased in conduit, if they are underground, so how did he see this weathering? Sounds like a bunch of crud to me. I would spend $50 and have a licensed electrician in your area go look at this and get his opinion. I really dont think your apprasier is correct in his thoughts. As far as the water and gas you can call the water department and gas in your town and they will turn them on for 2-3 days so you can do you inspection of those. Most time you can tell by the overall condition of the property if you might have reason to worry about such. I would be real concerned about the water heater, furnace and a/c.

Answer 3

The seller is responsible for repairs. The sellers real estate agent should take care of having the utilities on when then inspector comes.

The seller is still responsible for the property in a short sale not the bank.

Yes the costs for the wiring fix and other repairs can be deducted including a home warrantee .

I would have your agent write an amendment to the purchase contract for the wiring, utilities and inspection.Then send the amendment to the sellers agent. The bank will need to approve expenses, closing costs and commissions. This is fairly routine. The bank will have to reduce the price to cover the costs.

To protect yourself you should have a licensed inspector go over the property. This is well worth the $300-$500 and can save you thousands in the long run. The FHA inspector is for your lender not you.

Please feel free to contact me with additional questions or information you may need.

Good Luck.
Chris C
Real Estate Broker/Lender

Answer 4

You can ask for someone else to repair the wire, but chances are that you will be refused by both the bank and the homeowner. The bank is obviously already taking a loss, since this is a short sale. The homeowner apparently does not have money, or he would not be in a short sale scenario.

As far as the appraisal costs are concerned, these are your responsibility, since the appraisal is done at your behest in order to gain loan approval.

Your choices are to basically take the house 'as is', and foot the repair bills or pass it by. If your offer did not contain any contingencies relative to this inspection, you may be stuck without the option to pass it by.

Answer 5

NEVER owe money on a car that's out of warranty! This is why. I'd go straight back to the dealer and say the car's a lemon and try to return it. Your state's law might allow that, but it'll still be a heck of a fight, and I wouldn't get high hopes. "You should have done this inspection prior to sale", is what they will say. And they are correct in the law. An auto loan is a recourse loan that is secured by the car. "Recourse" means you owe the money even if the car dies. "secured by" means if the car becomes worthless, you owe ALL the money immediately. Don't you dare not pay the loan. That will hurt no-one but you. It will cost you more in the end and you can't afford that. $560.00 also sucks. Don't stick that on a credit card, you have enough debt. If you can't afford it any other way, then cut costs where you possibly can. The #1 place to cut costs is auto repairs. Those engine mounts? $45-$85 each at NAPA - and NAPA sells quality. So let's see, say $130 for both mounts, and you can save $430 by doing it at home. That's not like earning $430. That's like earning $600, because you don't have to pay taxes on money you SAVE. $430 is real money to folks like you and me. Even with tools and books, this repair will cost you well under $560, and then you'll have tools, books and skills. Now, you may have a preconception: "Poor people fix their own cars". Wrong. Actually, tinkering has become trendy. Make Magazine... TechShop... even WIRED magazine just said "Atoms are the new bits." Meaning they expect the major tech innovations to be in the physical world. Fixing your own car is about taking your power, not just forking out and owing.

Answer 6

You cannot fix something on a house that is not yet yours. Tell the seller that he/she has to fix the wire before you can get financing. If they don't, well then that's not the house you buy. You don't fix other people's houses.
The cost of the house is completely negotiable. He/She can agree to take any amount that you both think is reasonable off the price, or it may be better if they split or take on the closing cost.
The gas and water are major, major, huge, important, need to live, things. I would not buy a house that didn't demonstrate that they work (even if I knew they were a bit decrepit). If they work..great for now, if not...how rich are you?