Are You Buying/Selling a Home During a FEMA Declared Disaster?

As REALTORS®,  we are committed to helping our clients buy and sell homes with a full-service and stress-free transaction. But sometimes, Mother Nature has plans that none of us can control.  In moments of opportunity, we are not defined by the uncontrollable, but by how we overcome the challenge. Allowing Coldwell Banker agents to be your guide through the unexpected will ensure you have the best agents in the Real Estate industry at your side.

Here are a few tips to help guide you during unexpected times of FEMA-declared natural disaster.

If you are buying or selling a house that is under contract and has already been inspected before FEMA declared a natural disaster, it will have to be reinspected before it will be able to close.

Basically, the appraiser must confirm the property is habitable and contains no evidence of damage based on their inspection. This will also be the time that they address the property market value based on any accessed damage.

Regulations you need to be aware of  when there has been a FEMA-declared ‘disaster’ in the region of your home:

• Any property with damage must be re-inspected by the original Appraiser.
• The re-inspection should list necessary repairs.
• Repairs must be completed prior to closing, evidenced by a final inspection.
• If a conventional or government loan, the lender, and borrower are to sign ‘Lender Certification for Disasters’.
• If you have a VA loan, no re-inspection is required – only a “VA Lender & Veteran Disaster Certification” is needed and required to be signed by both Lender and Veteran.

The items listed above are all to ensure that the house is safe and that it is not a hazard to live in.

So… maybe the house was in the storm path and it got minimal damage, GREAT! But what if you weren’t so lucky and the damage was a little more extensive…

What happens if the home sustains severe damage from a FEMA-declared natural disaster while you are under contract?

Well, you have 3 options:

1. Create a separate agreement where the seller agrees to repair the home to its condition before the damages.
2. Accept the insurance payments related to the damage, take the home in its current condition, and repair the damage yourself.
3. Terminate the original contract and begin searching for a different home to purchase.

These options are obviously not what you had originally intended for the purchase or sale of your home, but they do give you some things to consider.

Make sure that you are discussing everything with your Coldwell Banker Real Estate Agent and staying close to the guidance given.   Through it all, your agent is there to serve you no matter the circumstances that arise.   Having an expert agent to guide you through this hard situation will make every bit of difference!

Have questions? Reach out today and we’d be happy to help in any way we can!