When a purchaser makes an offer on a HUD Home that was built prior to 1978 and buyer is utilizing FHA financing this triggers the asset manager (AM) to order from the field service manager (FSM) a lead based paint test. The FSM will complete a test of all deteriorated paint in home to determine if any tests positive for LBP. If the FSM finds deteriorated lead paint they will write-up a report with locations and cost to repair (aka. Stabilize).
HUD will complete up to $4,000 in lead paint stabilization – prior to closing.
If Lead-Based Paint was found and HUD will NOT complete stabilization. At closing the Purchaser shall receive a credit in an amount not to exceed $4000.00, representing the Seller’s contribution toward the cost of stabilization and clearance testing. The Credit shall appear on the FORM HUD-1 SETTLEMENT STATEMENT and shall be deposited in the 203(K) repair escrow account. If the actual cost of stabilization exceeds the credit provided or if the property fails a clearance examination, the Purchaser will be responsible for any additional costs. Please return the Lead-based Paint Addendum and the HUD 9548-G (203K Work write-up) 203K Addendum for Lead-based Paint
*Remember this pertains to homes built prior to 1978 and buyer is using FHA financing.
**If buyer changes financing from FHA to conventional or cash after LBP stabilization has been completed by HUD, buyer will be required to reimburse HUD for any costs associated with LBP stabilization.
Buyer will need to use a EPA Lead-Safe Certified Firm.
We use Premier Property Improvements. Please call for contact information.