Can a bank refuse to lend money if the home has radon? The answer to the question is yes. What they will usually do anytime there is a problem with the property itself; they will require the problem to be fixed, such as, if there is a roof that does not have a useful life. In order for them to give a loan, they may require that the roof be replaced in order to give the loan. That would be the same case as far as radon, in that they do not want to lend money if their collateral, which would be the home, would be impaired by any sort of defect, whether it be radon, whether it be a sinkhole, structural problems or not complying with the building code.
So the banks would not lend money because a house with radon is certainly not worth as much as one without radon and so it impacts the value of the home. I might add that in the Pasco County, New Port Richey area of Florida, I have not encountered any properties with radon. So we do have a radon disclosure, however I haven’t encountered that. So I can only speak in generalized terms as far as what lenders would do but I can’t imagine a bank lending money if they are aware that there is radon on the property.
This is Roland Waller. Give me a call at 727-847-2288 if you have any other questions about buying or selling real estate.