Final Condition
(Conveyance Condition)
Work Orders

A Final Condition work order (also called a Conveyance Condition work order) is a specialized WO that requires a little different approach for the property preservation specialist. The goal of this work order is to do work and submit bids, so that when all is completed, the property will be declared to be in Conveyance Condition (CC).

Please explain!

First, we need to define a couple of terms: FHA & HUD
Housing and Urban Development (HUD) is the department of the federal government under which the Federal Housing Administration (FHA) operates. When an FHA-insured mortgage is in default, the property is conveyed to HUD, and then put on the market for sale by HUD.

All properties that are insured by an FHA loan, when they are in default (foreclosure), will be conveyed back to HUD before they are put up for sale. Before they can be conveyed to HUD, there are specific conditions that must be fulfilled. When all of the required work has been completed, we say that the property is in conveyance condition.

HUD sets a date for conveyance, and as it gets close, a Final Condition WO will be issued. Always take special note of every Final Condition WO. A Final Condition WO is one that instructs you to do work and provide bids to bring the property into CC. All of the items must be completed in order for the property to be in CC.

If the work cannot be completed for the allowable, then HUD requires that a minimum of two bids be submitted by two different contractors, and they will approve the lowest of the two. So make sure your bids are descriptive and competitive, and your photos are clear and comprehensive.

What Work Must Be Completed For A
Property To Be In Conveyance Condition?

The following is a complete list of work that must be completed in order for an FHA property to be in Conveyance Condition (CC):

• Remediate all mold, including installation of dehumidifier where applicable
• Secure all pools &/or hot tubs
• Secure all doors and windows
• Remove all exterior graffiti
• Exterminate pests
• Alleviate trip &/or safety hazards
• Clean all dirty/moldy appliances
• Board, reglaze, or replace windows & exterior doors
• Remove all interior & exterior debris and health/safety hazards; includes interior broom sweeping
• Yard maintenance including lawn care, snow removal, &/or trimming shrubs
• Remove of abandoned vehicles
• Patch/Seal/Repair active roof leaks
• Clean and/or replace previously existing gutters/downspouts
• Repair damages
• Re-install previously existing handrails
• Clean or remove wet, moldy, urine/feces stained carpet
• Cap electric/gas/water
• Replace electric cover plates if power is on
• Winterize (if in season)
• Repair/Replace sump pump

Important Notes

Each time you submit a Final Condition WO you must answer this question: "Is this property in Conveyance Condition?" If it is not, you must provide current photos and bids for the work that is necessary to bring it into CC.

Please note: if you get a bid approval to remove, for instance, all exterior debris, you cannot submit a bid on a later WO to remove some exterior debris that you didn't see the first time. You will be required to remove the additional debris at your own expense. This does not include, of course, debris that was newly deposited at the property.

Bottom line is this: every time you get a Final Condition WO, make sure you provide bids for everything necessary to bring the property into CC. A contractor will get a bid approval to complete this work; hopefully it will be you!

Click here to go from Final Condition WO to Provide Access WO.