Does the garbage disposal really have to work for an FHA loan?

Are appraisers being too picky about calling out for repairs on FHA loans? I cannot speak for all appraisers by any means, but from an appraiser’s standpoint I’ll say that FHA has strict guidelines they expect their appraisers to follow. As a Certified Real Estate Appraiser in the Sacramento area, I have a HUD checklist that I go through while at a property, and if there are items HUD won’t accept, I have to call them out. Things like chipping paint, an inoperable heat system, a shattered window, or even a broken garbage disposal, can all hold up an FHA loan if not properly cured. 

It can be frustrating to think such a minor repair can be a deal killer for a loan, but at the same time, a good loan officer, solid lender, and superstar real estate agent will be able to cooperatively deal with issues like this. FHA repairs are normative in the course of business, and when you work with knowledgeable professionals, these things can be anticipated, maybe negotiated with the seller, and hopefully remedied (of course this might be difficult if the property is bank-owned, and the bank is unwilling to put even one cent back into the foreclosed property). See a video below that I shot during an FHA appraisal inspection (recorded with myTouch 4G cell phone):

Let me know if you have questions, insight, or any real estate appraisal or valuation consulting needs. If you are a local real estate or loan office in the Sacramento area, I’m happy to come and give my FHA presentation. Contact me at 916.595.3735, on my company website, or on Facebook.


  1. says

    I completely agree with the peeling/chipping paint, inoperable heating system and broken window. But I’ve never heard or seen the rule about a broken garbage disposal – are you sure?

    • says

      I’ll call HUD today for back-up assurance. If it’s there though and doesn’t work, it should work. If I find out otherwise, I’ll let you know. I am expecting a call back from HUD soon. Handbook 4150.2 says “13. Mechanical Systems: These are the requirements for mechanical systems: must be safe to operate, must be protected from destructive elements, must have reasonable future utility, durability and economy, and must have adequate capacity and quality.”

    • says

      Just got off the phone with HUD (Santa Ana office in California). They confirmed that the appraiser needs to check electrical, plumbing, and water and such. There is no specific garbage disposal clause in writing, but the disposal is lumped into the same category for the aforementioned things (according to HUD) the appraiser needs to investigate. Basically their motto is: “if it’s there inside the house, it needs to be operational.”

  2. says

    I’d like your FHA presentation! Lol, great video. Do you normally dress that well for an appraisal? In a, what looks like, vacant house? Or did you dress for us?
    Great video as usual.

    • says

      Sure thing, Jenn. 🙂 That’s what I wore to work for the day. A local Realtor shot a video of me that day actually, so I was a bit more spiffed-up than usual. I always wear a collar shirt when on inspections, but not usually a sweater vest with a long-sleeve shirt (I’m a short-sleeve collar guy most of the time).

  3. says

    I think what most people don’t realize is that HUD what buyers to go into the home purchase without any foreseeable expenses to come in The way of the borrower being able to make their house payment, and of course they want the home to be properly working. Great post Ryan.


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