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FHA loans · HUD Handbook 4000.1FHA appraisal required repairs: what must be fixed and what can stay

On an FHA loan the appraiser checks the home against HUD's Minimum Property Requirements and Standards and limits required repairs to what is needed to keep the property safe, secure and sound, keep it marketable, and protect the occupants' health and safety; the lender decides which repairs are actually required. Typical required items: a roof that leaks or has less than two years of remaining life (the appraisal goes subject to a roofer's inspection); a permanent heating system that cannot automatically keep living areas at 50°F, is unsafe or uses an unavailable fuel; frayed or exposed wiring or an inadequate panel; plumbing without proper pressure, flow or drainage, or a water heater without a pressure-relief valve and discharge piping; a damp basement, structural movement or signs of pests. Defective paint – cracking, scaling, chipping, peeling or loose – must be repaired on every interior and exterior surface of a home built before 1978, under the federal lead-based paint rule; in newer homes only exterior paint that exposes the surface to the elements. Cosmetic items stay as-is: missing handrails that are not a safety threat, torn screens, cracked window glass, worn interior paint in post-1978 homes, a dripping faucet. Central air is not required, but if installed it must work or its cost to cure is reported. Repairs that cannot be finished before closing can go into a repair completion escrow if the home is safe and habitable at closing.

Usually required

  1. Roof

    Must keep moisture out and have at least 2 years of remaining life; otherwise subject to a roofer's inspection.

  2. Heating

    Permanent system that keeps living areas – and areas with pipes that can freeze – at 50°F automatically.

  3. Electrical

    No frayed or exposed wiring; panel and amperage adequate for the home.

  4. Plumbing

    Pressure, flow and drainage work; water heater has a pressure-relief valve with discharge piping.

  5. Paint, pre-1978

    All defective paint, inside and out (including fences, sheds, garages), repaired under 24 CFR 200.810(c).

  6. Paint, 1978 or later

    Exterior paint that exposes the subsurface to the elements.

  7. Structure

    Settlement, bulging walls, damp basement, pests – inspection by a qualified person.

Cosmetic – not required (as-is)

  • Missing handrails that do not pose a safety threat.
  • Holes in window screens and cracked window glass.
  • Defective interior paint in homes built in 1978 or later.
  • A dripping faucet or other minor leak that causes no damage.
  • Working components that are simply old – age alone is not a reason to replace.

Repairs that can't finish before closing

  1. At closing

    Repair completion escrow

    Allowed if the home is habitable and safe; funds must cover the cost, not the borrower's own labor; lender signs HUD-92300.

  2. After the work

    Compliance inspection

    The lender certifies completion on HUD-92051.

What the TC can do

  • Ask the listing side early about roof age, the heating system and peeling paint on older homes – the FHA appraiser will.
  • Make sure utilities are on for the appraisal; otherwise the appraiser must come back after they are restored.
  • Put agreed repairs in writing and leave time for the re-inspection before closing.

Questions buyers and sellers ask

Does peeling paint fail an FHA appraisal?

In a home built before 1978, all defective paint inside and out must be repaired under the federal lead-based paint rule. In a newer home, only exterior paint that exposes the surface to the elements must be fixed; defective interior paint is cosmetic (HUD Handbook 4000.1).

How old can the roof be for an FHA loan?

Age itself is not the test: the roof must keep moisture out and have at least two years of remaining life. With less, the appraisal is made subject to an inspection by a professional roofer.

Do missing handrails have to be fixed for FHA?

Only if they pose a safety threat; HUD lists missing handrails that do not threaten safety as a cosmetic item.

Related guides

ClosingCode's checklist has an "as is or subject to" appraisal step due before the appraisal contingency – so required repairs are scheduled while the buyer can still act.

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Source: HUD Handbook 4000.1 (last revised 8/12/2026), II.D.3 appraiser requirements and II.A.6 repair completion escrow, hud.gov, read October 25, 2026.

General information about FHA-insured loans, not legal or financial advice. The lender decides which repairs are required. ClosingCode is software; it is not a lender, appraiser or inspector. This guide is not a substitute for the advice or services of an attorney.