Mortgage Grapevine

USDA Septic Inspection Question

I have a borrower that is buying a vacant home on a USDA loan. The county will not inspect the septic unless someone has been living in it recently. Septic is only a year old, so there should not be any issues with it anyway. I had a loan I did last year where the lender told me they always needed a septic inspection on vacant homes, and I closed a loan at another, now defunt lender, that did not require a septic on a vacant home. Who else does not require a septic on a USDA loan on a vacant home?
by Vinnie The Leg Breaker August 12, 2009 10:15 AM

Vinnie, use a private inspection company and close with Chase. I just did one.

by Billy The Kid August 12, 2009 10:27 AM

Vinnie.....what Billy said is the way to go.
by whatever August 12, 2009 10:29 AM


Per Vince at the Columbus USDA office, MAKE SURE YOUR APPRAISER USES this exact verbage in the report-

"I am an FHA roster appraiser. The property meets HUD handbook 4150.02 and 4905.1 guidelines"

That will clear the property from any additional inspections (septic or pest) as far as the USDA is concerned.

Some LENDERS have overlays, but I've closed many loans (most with TBW, unfortunately) in Lake and Geauga counties where the property was vacant, and did not have any issues at all from the lender or the USDA.
by XpressOH August 12, 2009 11:12 AM

Vin what Xpress is referring to is the Existing Dwelling Certificate.
by BigHappy August 12, 2009 11:21 AM

I know the USDA is cool with it, it is just a matter of the underwriter.
by Vinnie The Leg Breaker August 12, 2009 11:45 AM

I'm with Billy. I have a septic guy who will go out same day and do an ispection for $100. Just do it and move on.

by picard August 12, 2009 12:09 PM

If the county has the permit records for the septic (which they should) that will usually work also. Generally they are just looking to make sure that the septic is X amount away from the well and that type of thing.
by lighthouse1 August 12, 2009 4:01 PM

I'M with Billy...all those with Billy, please stand up!

by ICD's No. 1 Groupie August 12, 2009 8:48 PM


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