Do appraisers really have to inspect the attic for an FHA loan?

If you have an attic and you’re getting a FHA loan, the appraiser is going to have to do a “head and shoulders” inspection of the attic. This means the appraiser will at minimum need to poke his/her “head and shoulders” in the attic for a quick view.

FHA before and after attic access by appraiser - Sacramento Appraisal Blog

What if the attic has been sealed off? If your attic access has been covered (or the appraiser cannot access the attic due to clutter in a closet), you will have to provide access to the appraiser at some point before the loan closes. For instance, the attic above on an investor flip was previously sealed for whatever reason, so the owner had to install a scuttle after my original inspection so I could fulfill the attic inspection requirement by FHA. Obviously if a house does not have an attic due to a flat roof, an attic inspection is NOT required.

For reference, FHA loans make up about 20% of sales in Sacramento County under $200,000. While this number is currently down from about 30% one year ago, FHA loans are still happening very regularly.

What are appraisers looking for in an attic? Watch the video above (or here) for a bit more information on what appraisers are looking for during an attic inspection. I shot this video a couple of years ago.

I hope this was helpful to answer some of your questions. You can check out other FHA appraisal articles I’ve written, and definitely comment below if you’d like.

presentation for SAR - copyright Ryan LundquistEVENT THIS WEEK: By the way, this Friday March 1, 2013, I’ll be speaking at Sacramento Association of REALTORS at 9:30am at the Industry Update meeting. We’ll have some great discussion for an hour. All Realtors and SAR affiliates are welcome. Click the thumbnail image to view the first page of my talk.

Question: Have you ever been in your attic?

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Comments

  1. says

    Maybe the requirement should be rephrased “we’re going to guarantee your 96.5$ LTV with taxpayer money that has a significant history of failure….would you mind?”

    Also a thought – an intentionally blocked attic access is a clear sign that 1. the flipper is inexperienced, 2. unaware of building code/unlicensed 3. more code violations will be present and a detailed inspection should be done – at least I would take that bet.

    • says

      That’s how it is Jeff. We all watched how FHA rose to dominance to replace 100% financing that was so common during the previous boom. I keep seeing articles that use words like “going to fail” when talking about FHA’s current status. We’ll see how it pans out.

      This house had almost 10 required repairs. This flipper tends to do a pretty good job most of the time, though obviously this one had some issues for whatever reason. I would tend to agree with you though. Usually clutter that blocks access is due to a home owner’s stuff in the way (not an investor).

      Part of me wonders sometimes if investors don’t provide access because appraisers aren’t inspecting the attic. I hear fairly regularly from agents that appraisers don’t bring a ladder to FHA inspections. Unless there is a drop-stair access, a ladder is a necessary tool. I’d love to hear about this from anyone in “the know”.

      • says

        Jeff, I’ll add one more thing. I have a different flip on my desk that is a “lipstick on a pig” flip. It’s for an FHA loan, but clearly the investor is not in tune with FHA standards as there are very obvious issues that should have been taken care of during the renovation. There are many investors who do an outstanding job in the Sacramento market, but I’ll be careful when inspecting this particular company’s flips because their works ranks high on the shoddy scale.

  2. says

    I thought of this the other while inspecting the attic of an older home – is HUD responsible when appraisers get mesothelioma?

    It’s somewhat of a joke, but just think about it. Whenever you see asbestos wrapped around pipes in the basement you don’t dare touch it so it becomes airborne. Yet HUD/FHA requirements tell appraisers to pop open the scuttle, have a bunch of insulation fall in your hair and clothes then stick your head up there and snap a couple photos. Maybe I’m just being paranoid…

    • says

      Ben, that’s an interesting point. I always hold my breath when doing attic inspections because I never know what is up there. I want to limit breathing in as much as possible. Good reminder to be careful too. Thanks.

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