Buying a house & problem with appraisal

BRWenkMarch 24, 2014

We are purchasing a beautiful house in the State of Washington. The siding on the house is hardboard siding (the bad kind that has been litigated), and it needs to be replaced in some areas. The inspection on the house was all good, except for the exterior siding issue (no moisture showed on a meter on interior walls at the area of bad siding.) The appraisal was good, too, except for basically a work order for the siding to be repaired/replaced/sealed in order to meet the value of the appraisal. This is a State of Washington caveat to protect against mildew/mold, etc.

Here is our problem. We got a good price on the house, knowing the siding was in need of repair/replacement. We are taking the house as is because of this. Now the appraisal stipulation will prevent the sale going through unless the siding is at least sealed.

The house is scheduled to close now, and my wife and children will be moving right after closing to live in the house so it will be occupied and I will be transferring there in about three months. I plan to do the siding work myself (I have house construction as part of my background), and would not want nor trust anyone else to do it for me.

Can anyone give me ideas of how to handle this situation. The underwriters won't accept the "I'll do it later" scenario :)

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mpinto

As a Realtor myself, I am no stranger to underwriting hell. This isn't done in all areas or with all lenders, but see if they will allow you to escrow money for this purpose. If not, work out something with the seller. Maybe amend the contract to have him/her do the work that you will pay for at closing? Let us know how it works out.

    Bookmark   March 24, 2014 at 3:50PM
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kirkhall

Ah, yes. T1-11 siding. I remember seeing those houses when we were looking and my realtor warning about them.

I like the escrow scenario above.

Or, maybe hire JUST the sealing to be done with a contractor (your REA probably has one on their reference tree), and then when you move here, in much nicer weather, I might add, you can pull it off and do it right.

    Bookmark   March 26, 2014 at 1:44AM
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BRWenk

Either I misunderstood the lender or was misinformed... I guess it doesn't matter. Nothing will satisfy the lender but having at least one side of the house (the weathered side) replaced. Also, the work must be done by a licensed contractor. So I am forced to cave or start from scratch. So we are amending the contract and I will pay at closing.

Thanks for your suggestions and help.

    Bookmark   March 26, 2014 at 10:02PM
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