Question 65

Which of the following would be acceptable to the FHA?

The FHA would accept certain conditions regarding appraisals and financing. Among the options presented, the one that adheres to FHA guidelines and practices is the correct choice.

A) which was surprising because they were only putting 3.5% down with an FHA insured loan. If the appraisal comes in $15

This option is incorrect as it provides context about the couple's financial situation but does not directly address what would be acceptable to the FHA regarding appraisals. The mention of a low down payment does not align with the specific requirements or acceptable actions outlined by the FHA.

B) 000 less than the agreed amount

This option also fails to address the FHA’s guidelines directly. It merely indicates a potential appraisal difference without specifying acceptable actions or solutions that the FHA might endorse in response to such a situation.

C) which of the following would be acceptable to the FHA?

This option is correct as it poses a question about FHA acceptability criteria, which is central to the context of appraisals and loans. Understanding what is acceptable to the FHA is crucial for ensuring compliance with their lending standards, especially in cases where appraisals do not meet the contract price.

D) making sure this loan is not insured because of the lower appraisal

This option is incorrect because it suggests rejecting FHA insurance based solely on a lower appraisal, which does not align with FHA policies. The FHA typically looks for solutions to reconcile appraisals rather than denying insurance based on appraisal outcomes.

E) giving the improvements more value and adding money to the appraisal

While improving property value can be beneficial, this option does not address the FHA’s standards directly. The FHA is more focused on ensuring that the appraisal reflects the property's true market value rather than artificially inflating it.

F) paying the $15

This option is incorrect as it suggests a direct payment to cover the appraisal difference, which does not conform to FHA guidelines or practices. Simply paying the difference does not resolve the underlying issues with the appraisal.

G) 000 difference between contract price and appraised value

This option, similar to others, mentions the appraisal difference without providing context on FHA acceptance. It does not present a solution or acceptable method for addressing the appraisal issues under FHA regulations.

Conclusion

The correct answer, C, is essential as it prompts a consideration of what the FHA would accept, which is critical in real estate transactions involving government-backed loans. All other options fail to provide actionable or conforming strategies regarding FHA policies, making them less relevant in the context of the question. Understanding FHA acceptance criteria is vital for ensuring a successful loan process.