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Can You Waive the FHA Peeling Paint Repair Requirement?

Paint peels on the outside of a home.

If you’re buying a home with peeling paint anywhere on the structure, you may need to get it repaired. Whether you want to waive this requirement depends on when the house was built.

Peeling Paint Repair Requirement for Pre-1978 Homes: Can’t Be Waived

Peeling paint must be repaired if the home was built before 1978. You may not waive this requirement.

This is because lead paint was legal and often used on homes before 1978. Peeling and chipping paint on a pre-1978 home is a health and safety issue. It could result in lead poisoning of the residents.

FHA will not allow a loan to close if the property has health or safety issues, including possible lead exposure. Again, this repair can not be waived.

Peeling Paint on Homes Built in 1978 or Later

According to FHA guidelines, the FHA loan can sometimes close without repairing chipping paint. The home must have been built in 1978 or later, and the chipping is purely cosmetic.

Repair is only required on a 1978+ home when missing paint “exposes the subsurface to the elements.” In other words, bare siding might rot due to lack of paint.

What Can I Waive When It Comes To Peeling Paint?

By now, you’re disappointed that you can’t waive paint repair requirements on a pre-1978 home. That’s understandable. Getting the seller to fix a small repair like that is a pain. Unfortunately, the repair must be done.

So what exactly can you waive?

On a pre-1978 home, you can waive the 10-day period in which to conduct a lead paint inspection. FHA allows this time window before you become obligated to purchase the home. In other words, you get an extra 10 days to inspect lead hazards in the home. You can back out of the purchase at any point during that time.

Waiving this right, though, can be useful in a seller’s market.

For example, you sign a purchase agreement for a 1965-built home on June 1. The seller wants to eliminate ways in which you can get out of the contract by June 5. As a condition of purchase, the seller wants you to waive your 10-day window for a lead inspection.

You can waive that opportunity to get the home. If lead is later discovered, you can’t use it as a reason to withdraw from the purchase.

While risky, it’s within FHA guidelines to waive the right to your lead inspection waiting period. Always consult your agent and other professionals before exercising your waiver.

Lead Paint Inspection Waiver Free Download

The lender may supply their required form if you want to waive your 10-day window. If not, you could use something like the one below, which uses wording from the HUD 4000.1 guidelines.

>>Go to the Google Doc template


Sample text:

Property address

To Whom It May Concern:

I hereby waive my right to a 10-day period, before becoming obligated to purchase the home, to conduct a lead-based paint inspection or risk assessment, to determine the presence of lead-based paint or lead-based paint hazards.

Sincerely,

[Your Name]
[Date]

Alternatives to the Seller Repairing Paint

You cannot do much to avoid repairing paint on an older home. Luckily, this is a relatively fast and cheap fix. With any luck, the seller will take care of it.

If the seller refuses, you have some options.

FHA Repair Escrow

FHA allows you to finance up to $5,000 in repairs to be completed after closing. With this option, there's no risk of doing the repairs yourself before closing to have the sale fall through.

FHA 203k

If you’d like to complete larger projects, you can use a Limited FHA 203k loan. Finance cosmetic and safety-related repairs into your home purchase loan, up to about $31,000 before contingency costs and other fees. There’s also a Standard 203k loan for which there’s no repair cost limit except for local FHA loan limits.

Find Another Home

If no options are working, you may have to find another home. However, the seller should know that a conventional appraiser will probably require the same repair. A safety issue is a no-go for any loan type.

FHA Peeling Paint Waiver FAQ

Can you waive a peeling paint repair requirement on an FHA loan?

You can not waive a peeling paint repair that is required by the appraiser. Homes built before 1978 may have lead-based paint, which is a safety hazard. All safety issues must be repaired before an FHA loan can close.

Can I waive my right to a lead-based paint inspection?

Yes, you can waive your right to a 10-day window in which to perform a lead-based paint safety inspection for an FHA loan. However, you can't waive peeling or chipping paint repairs required by the appraiser.

Can I make paint repairs after closing on an FHA loan?

Yes, you can make safety-related repairs after closing if you use the FHA repair escrow program. You can resolve hazardous or cosmetic issues after closing with the FHA 203k program.

What if the seller won't repair the chipping paint before closing?

You can offer to make repairs after closing using the FHA repair escrow or FHA 203k programs, or you can find a different home to buy that was built on or after 1978 or without paint issues.

Don’t Be Afraid To Get a Second Opinion

If you’re having trouble with your FHA lender or just want a second opinion, contact me with any questions. I’d love to help. I can connect you with a reputable lender who can get the job done.

About The Author:

Tim Lucas spent 11 years in the mortgage industry and now leverages that real-world knowledge to give consumers reliable, actionable advice. Tim has been featured in national publications such as Time, U.S. News, MSN, The Mortgage Reports, and more.

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