The Veterans Administration (VA) has backed off forcing the Seller to pay for the WDO upfront. Buyers using a VA loan can, once again, pay for the WDO and get reimbursed from the Seller at closing. Of course, the Seller may still pay for the WDO upfront although that rarely happens.
WDO v. WDI: The VA/FHA/HUD/FNMA prefer the use of the national NPMA-33, Wood Destroying Insect form whereas, in Florida, FDACS requires WDO inspectors to utilize the DACS Form 11645, Wood Destroying Organisms inspection form. Many realtors do not know the difference so here it is: The NPMA-33 form requires identification and recommended treatment for Wood Destroying Insects only whereas, the Form 11645 used in Florida requires inspectors to note wood destroying organisms which include insects and organisms such as wood decay, wood rot, etc, but does not require inspectors to recommend a treatment plan. Lender appraisers note the presence of water damaged wood as WDO (even when it may not be WDO per FDACS). Often, minor water damage such as we find at the bottom of T-111 wood siding (where it is generally too close to the ground) is rarely a WDO but rather is delamination of the wood plies. FDACS does not require the WDO inspector to call this WDO even though the appraiser often does so. Many WDO inspectors will insist on noting this in the Comments section which they should for protection against future claims!
The issue often comes when the Realtor advises the WDO Inspector the VA/FHA won’t write the loan if “any” comments other than CLEAN are noted. This presents problems to all professionals involved. As a WDO Inspector, I know this may not be WDO but if I fail to note the presence as a comment, I am exposing my firm to legal claims. If I can’t support the Realtor/Buyer, I recognize the sale may fall through for no real reason.
The answer, when the damage can’t be repaired, may be issuance of the NPMA-33 form where the inspector does not have to comment on minor water damage (it’s not an insect). Florida law still requires the inspector issue the state form but the inspector can also issue the national form which may be submitted to the VA/FHA to satisfy their requirements – they actually prefer the national form.
Discuss this with your WDO Inspector – it may help close deals for your buyers.
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