Inspection and Utility Activation Steps

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Inspection Period

 

• Home inspections are highly encouraged by HUD

 

• The buyer will have 15 calendar days to do inspections and let HUD know if he or she wants to move forward w/ the sale. 

  • Owner Occupied Buyers can cancel in the 15 days due to unsatisfactory home inspection and get a refund of the EMD; however, it cannot be b/c of items already listed on the property condition report.​

  • Investors can have inspections during this 15 day period but will not receive a refund of the earnest money deposit if they cancel.

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• If the buyer chooses to cancel the contract due to unsatisfactory inspection findings, the Contract Release and Earnest Money Disposition Request form will have to be filled out. Then, this form will have to be emailed with supporting documentation provided (i.e. home inspection report) and emailed to HUD as instructed on the page w/ the form. Again, cancelling can’t be for a reason listed on the property condition report to get the EMD back.​

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Turning on Utilities for Inspections

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• The buyer is responsible for all costs associated with turning on utilities.

 

• If the buyer wishes to do a home inspection w/ utilities turned on, the buyer will need to schedule to have the utilities turned on w/in those 15 calendar days.  HUD doesn’t turn utilities on. Also, if the buyer's lender needs to have utilities on for the appraisal inspection, that must also be done while the utilities are turned on.

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• Utility Activation Time - The utilities may be activated for a maximum of 72 hours excluding weekends and all federal holidays.  So, if the utilities are turned on Friday, they must be turned off by Tuesday.  Or, if the utilities are turned on Monday, they must be turned off by Wednesday.  

 

• Suggested Best Practice - it is a suggested best practice to schedule for de-winterization and utility connections as soon as you receive the ratified contract back. ESPECIALLY to coordinate this with your buyer’s lender for the appraisal inspection. 

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•  The selling agent or representative must be present when all contractors or inspectors are at the property.

 

• Before Inspection Email - HUD will send the buyer's agent an email w/ a link to a form to fill out to get permission from the Field Service Manager (FSM) to have the property de-winterized (if needed) & utilities turned on.  Dates are needed to fill out this form, so activations need to be scheduled w/ the utility companies & plumber for de-winterization.  This form can also be found at http://blmco.com/utility-activation-tool/

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Steps for Utility Activations

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1. Schedule de-winterization (if needed) & utility turn on/off dates

   1. The turn on date must be at least 3 days from the time you submit the form w/ blmco.com – no sooner.

2. The buyer's agent will input the utility turn on/off dates in the online form and the re-winterization date. 

   1. The re-winterization date will be the last date of utility activation that occurs between noon and 5 PM. The turn on date must be at least 3 days from the time you submit the form – no sooner.

   2. There is no line to input the de-winterization date.  If you are authorized to turn on the water, this must done first.

3. Wait for approval from the Field Service Manger – you should receive an email w/ approval w/in a few days. At least 2 business days is needed to process the request.  Save a copy of the approval.

4. Get the property de-winterized first (only if turning on water) and approved utilities turned on.

5. Complete inspections (including appraisal inspection if utilities need to be on for the appraisal inspection.  Check w/ the lender about this.)

6. Utilities will be disconnected on their scheduled disconnection dates

7. The field service manager will have the property re-winterized, if needed.

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When to De-winterize

 

• De-winterization is a very specific process.  It removes the antifreeze in the plumbing so that water can flow through the pipes.  So, if you are getting water turned on, this has to be done first.  Look at the property condition report and if you see that the pipes failed the pressure test that they completed prior to putting the house on the market, HUD won’t allow you to have the water turned on.  There is probably a leak somewhere. MAKE SURE YOU ARE WORKING W/ A CONTRACTOR WHO KNOWS HOW TO PROPERLY DEWINTERIZE!!!!! Here is a contact to a plumber who handles a lot of de-winterizations in this area: 757-409-4345

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• De-winterization also applies to properties w/ wells

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Denial of Activations by the Field Service Manager

 

• In cases where plumbing, gas, or electrical deficiencies exist, approval for activation may be denied. Repairs will not be made for the purpose of utility activation. Please check the ‘Property Condition Report’ to see if there are deficiencies noted.  

 

• If HUD won’t allow the water to be turned on, a pressure test can be done by a licensed plumber to see if there are any possible leaks. 

 

• Electricity and water have to be on for the gas to be turned on​​