Dozens of home sales throughout the east coast of the US have been put on a temporary hold, as a result of the devastation wreaked on the area by Hurricane Irene last week, which caused flooding and damage to properties across eleven states.
According to John Walsh of Total Mortgages Services in Connecticut, the problem is that appraisers now have to re-inspect the properties due to be sold, in order to ascertain that the values of the homes earmarked for sale have not been affected by hurricane damage. Walsh said that he estimates from 15% to 50% of the pending mortgage applications his company is handling will be required to wait for re-inspection by appraisers.
Those buyers who have home purchases pending, and also homeowners who are applying for refinancing could also be forced to wait for re-inspection of their properties. Should severe damage be found on any of the properties, it’s possible that lenders may change their minds and refuse to provide loans on them.
Speaking to HousingWire, Fannie Mae spokesperson Andrew Wilson said that it’s too soon to be able to tell how many applications for purchasing or refinancing of homes will be affected by Irene. However, he did reveal that homeowners with Fannie Mae mortgages who had suffered from flood-related damage might be able to apply for loan forbearance.