HELP, Bank Wont Give Mortgage With Coal Heat!!!

I'm in the process of buying a house in NEPA, the house is heated with coal and wood. My lender's appraiser wont pass the house because it does not use an electric or gas heat system!!!!!

Any one here work for a mortgage bank?

Is this legal or discrimination?

backroads wrote:I'm in the process of buying a house in NEPA, the house is heated with coal and wood. My lender's appraiser wont pass the house because it does not use an electric or gas heat system!!!!!

Any one here work for a mortgage bank?

Is this legal or discrimination?

No coal heat in NEPA the lender must be from out of state Never heard of that in The Biggest Anthracite Coal State
look somewhere else sounds to me it is discrimination .

Explain to them that with coal heat, you'll be
able to make the monthly payments.

Catch 22: House with coal heat won't sell because bank won't give
money for house with coal heat.

backroads wrote: My lender's appraiser wont pass the house because it does not use an electric or gas heat system!!!!!

Firstly what exactly is the type of system installed? You said wood? That may be the reason why as wood is not considered a primary heat like coal. Is it just a small stove or full boiler? More information....

Secondly I would ask them specifically what the issue is and I wouldn't take "because it's coal" as the answer. You can certainly get the information here that will shoot down any reason they could possibly come up with.

I would suggest, if you really like and want this house, you state to the lender that you will install a gas, oil, or electric system, with the incorporation of the loan agreement. It doesn't have to be an expensive, elaborate system, just a cheap furnace tied into the same heating system.

Then, I see now reason that the lender will not give you the money for the purchase of the home. The so called conventional heat will be in place, even though you intend never to use it. But, your lender doesn't need to know that, just that the house is equipped with a conventional system should be good enough.

The banks concern is that coal heat requires human intervention. If you were unable to tend the coal furnace for any reason, pipes freeze and lots of damage is done. The home I grew up in in the 50's had coal heat only. Wasn't a concern back then.

coalkirk wrote:The banks concern is that coal heat requires human intervention. If you were unable to tend the coal furnace for any reason, pipes freeze and lots of damage is done. The home I grew up in in the 50's had coal heat only. Wasn't a concern back then.

We are talking about coal heat in PA there should be no problems with it in PA at one time everyhouse that was built before the late 70s early 80S had coal heat in it now today maybe every forth or fifth house has coal heat at least in this Part of the state. Even the PA State leheap low income winter heating program is giving money to People that heat with
coal . If it is good enough for the State of PA giving out money then the lender should not have a problem giving it out

tsb wrote:Explain to them that with coal heat, you'll be
able to make the monthly payments.

Catch 22: House with coal heat won't sell because bank won't give
money for house with coal heat.

SOOOO true about the monthly payments lol

DOUG wrote:I would suggest, if you really like and want this house, you state to the lender that you will install a gas, oil, or electric system, with the incorporation of the loan agreement. It doesn't have to be an expensive, elaborate system, just a cheap furnace tied into the same heating system.

Then, I see now reason that the lender will not give you the money for the purchase of the home. The so called conventional heat will be in place, even though you intend never to use it. But, your lender doesn't need to know that, just that the house is equipped with a conventional system should be good enough.

I talked to someone in NY that had the same problem. They purchased a furnace and provided the receipt to get the loan application to go through. They closed on the house, and the furnace was still in the box...

Try to find a small local bank, preferably one that doesn't re-sell its mortgages on the national market. They would have the flexibility to make the loan on their own terms rather than the mortgage-buyer's terms.

Electric baseboard is comparatively cheap to install, gives you the security of a simple and reliable backup, would probably satisfy the bank, and as long as you never have to use it, who cares how expensive it is to run? But when you go to resell the house, if a buyer doesn't want coal heat, electric costs could be a deal-breaker.

Good luck. Be sure to let us know how this comes out.

A couple of Amish Mantles should cover that.

Electric baseboard is comparatively cheap to install, gives you the security of a simple and reliable backup, would probably satisfy the bank

Not a bad idea if something breaks or you have to spend a few days away. It does't have to heat the house to comfort levels, just keep everything from freezing. My first experience with coal had baseboard electric backup. Thank the coal gods for that! There wasn't any NEPA Coal Forum back then and I would have froze to death before I figured out how to run that old beast!

i just refinanced fha and had an appraiser in my home.i had furnace disconnected and duct work out of the cieling.when he asked what I use to heat home I said oil heat.that was it.id push the issue that hud requires heat you don't have to constantly maintain and keeps all rooms in house above 50 degrees.a stoker stove with coal needs attention like every three days.that takes maintaining but the oil man coming takes maintaining to.fight!!!!

I bought and refinanced a house with electric baseboard heat as a back up and a hand-fed coal stove as the main source of heat. None of my lenders or appraisers ever gave me a problem. This was in the Reading, PA area.

I'm dealing with this now. Quicken has me on hold pending an exception request. It's an FHA refinance. My appraisal/inspection went fine but a request for repairs came back. I don't need repairs if the repair is a different fuel source. Very stressfull.

backroads wrote:I'm in the process of buying a house in NEPA, the house is heated with coal and wood. My lender's appraiser wont pass the house because it does not use an electric or gas heat system!!!!!

Any one here work for a mortgage bank?

Is this legal or discrimination?

Sounds legal and not discrimination. I would put any costs on getting it up to snuff on the seller. Its a buyer's market. They don't want to? Find a different house.