FHA Repair Guidelines Explained | GO Mortgage

When you’re shopping for a home with a government-backed loan like an FHA mortgage, there’s a lot to love—especially the low down payment and flexible credit requirements. 

However, if you’re considering a home that requires some repairs, it’s essential to understand the FHA home repair guidelines and how they can impact your transaction.

Unlike conventional loans, FHA mortgages are accompanied by specific property standards designed to ensure homes are safe, sound, and secure. 

That can affect everything from your inspection timeline to who is responsible for fixing problems that arise before closing.

Let’s walk through how these guidelines work—and how to stay ahead of potential delays during the buying process.

How do FHA loan guidelines differ from conventional ones?

FHA and conventional loans follow different appraisal processes. A conventional appraiser focuses mostly on the home’s market value, while an FHA appraiser checks both value and condition. 

Specifically, they follow the U.S. Department of Housing and Urban Development’s (HUD) Minimum Property Standards to confirm the home is livable and safe.

Here’s how the two compare:

1. Conventional loans: Appraiser verifies home value based on recent sales.
2. FHA loans: Appraiser verifies home value and inspects for structural integrity, safety hazards, and basic functionality.

FHA appraisers must also include photos, location maps, and documentation showing that the property meets HUD requirements. 

If anything falls short, the lender may not approve the loan until the issue is resolved.

What does an FHA appraisal include?

A certified FHA appraiser will:

• Conduct a full visual inspection—inside and out.
• Photograph the front, sides, and rear of the home, plus any value-adding features like patios or garages.
• Include photos of comparable home sales used in the valuation.
• Provide a location map showing the subject home and comparables.
• Confirm grading if the home is new construction.

This process helps ensure the home meets the minimum health and safety standards, which are important for both the buyer and the lender.

You can review the current full list of FHA appraisal requirements at HUD.gov.

Who is responsible for FHA loan repairs?

Whether the seller or buyer must handle FHA-required repairs depends on how your offer is written. Typically:

• The seller handles repairs if the contract says the home must meet FHA standards prior to closing.
• The buyer may agree to undertake some or all repairs, with the seller’s permission, to facilitate a smooth transaction.

If a buyer starts with a conventional loan and switches to an FHA loan mid-process, the seller may only proceed if the buyer agrees to take responsibility for the repairs. 

That’s why it’s smart to work with a knowledgeable real estate agent and mortgage advisor early in the process to clarify who’s responsible.

What repairs are required before closing on an FHA loan?

If a property doesn’t meet FHA standards, the lender won’t approve the loan until required repairs are complete. These must be addressed prior to closing.

Here are common issues that require fixing under current FHA repair guidelines:

• Peeling or chipping paint, especially in homes built before 1978
• Broken gutters or downspouts
• Doors that don’t open or latch properly
• Exposed or frayed wiring
• Uncovered electrical junction boxes
• Plumbing leaks or inoperable fixtures
• Non-functioning heating or cooling systems
• Leaking, sagging, or damaged roofs
• Roofs with less than three years of life expectancy
• Visible termite or pest damage
• Structural cracks or foundation problems
• Rotting window sills, porch columns, or support beams
• Standing water in crawl spaces or basements
• Missing major appliances normally included in the sale (e.g., stove)
• Empty or hazardous pools, especially those without working pumps or covers
• Leaning or damaged fencing

These guidelines aim to protect both the homebuyer and the FHA from purchasing a home that might have costly, hidden defects.

What happens if the home doesn’t meet FHA standards?

If a home fails to meet FHA’s Minimum Property Standards, the lender cannot move forward with funding the loan unless one of the following solutions is implemented:

1. The seller makes the repairs

In many cases, sellers agree to fix the issues to avoid losing the sale. These repairs must be completed and re-inspected (often by the same FHA appraiser) before the loan is cleared to close. Repairs typically must meet professional standards—DIY fixes might not pass.

2. The buyer assumes responsibility, with lender and seller approval

Sometimes, a buyer may offer to complete the repairs after closing, but this is only allowed under limited conditions and requires lender approval. 

Typically, lenders will require an escrow holdback, where funds are set aside at closing to ensure the work gets done.

3. The contract is canceled

If neither party is willing or able to make the repairs, and the issues are considered non-negotiable by FHA guidelines (e.g., structural damage, mold, or major HVAC issues), the loan will be denied, and the purchase may fall through.

4. Switching to a renovation loan

If the property has serious issues but great potential, the buyer might pivot to an FHA 203(k) loan. This allows for financing of the purchase and the cost of repairs, although it comes with additional paperwork, time, and contractor oversight.

How can you avoid FHA repair delays?

If you’re using an FHA loan to buy a home, here are five tips to keep things moving:

1. Schedule a pre-offer inspection. This helps identify potential issues before submitting an FHA offer.
2. Work with an FHA-savvy Realtor. They’ll know how to structure the contract to protect your interests.
3. Review the seller disclosure carefully. This can flag known issues like roof leaks or HVAC problems.
4. Get pre-approved before you house hunt so sellers take your FHA offer seriously. Start your pre-approval now.
5. Use experienced mortgage advisors. GO Mortgage specialists understand FHA processes and can help guide your repair negotiation strategy.

Can you buy a fixer-upper with an FHA loan?

Yes—but there are special loan options like the FHA 203(k) renovation loan, which lets you roll repair costs into your mortgage. 

You’ll still need to meet FHA appraisal and contractor guidelines, but it can be a smart way to buy a home that needs work without paying out-of-pocket for everything upfront.

Explore your FHA loan options 

Want to learn more? Check out our full guide to buying a house as-is with an FHA loan and discover your options for homes that need light-to-moderate repair.

If you’re still unsure whether an FHA loan is right for your homebuying goals—or want to know what fixes might affect your approval—we’re here to help.

The experienced team at GO Mortgage can walk you through the process, from inspection to close. Apply for a home loan today.