Final word is that unless our well owner will make her water system an LLC, FHA considers it a shared well, and not a community well. So, my agent asks if I think we could get her to do the LLC. I said not very likely. I had to beg for her to write up a 2 sentence statement stating she owns the well and it is not a shared well (hoping that would suffice for some "proof").
I told my agent it would probably be better if she called and tried to ask and explain it to her, especially since my agent is saying she will take care of getting it all done for the well owner. My agent left her a voice mail.
Then I called well owner, thanking her for the signed little statement, but unfortunately the lender won't accept it, it has to be an LLC. Remember, this is like an 82 year old woman. "well, I'm just not going to do that. I'm not ready to make it an LLC, at this time. Maybe some day. I don't have the money to do it (the real reason she is saying no)". I told her the cost would be covered for her (agent said it's like $200) and our agent wanted to take care of the process for it for her and that our agent had left her a voicemail about it a little earlier. "yes, well, I got that voicemail but I'm just going to ignore it. I don't want to be bothered having to do an LLC right now".
Obviously, it is something that is probably overall in the best interests of the well owner, to protect herself, to have this an LLC, rather than the chance of getting sued by one of the property owners. Plus, like our agent said, she is tying the hands of all the property owners who might want to sell down the road and won't be able to market to include prospective FHA buyers. My agent said all the work for it will be done, the well owner would literally just have to do a couple of signatures for it. I told my agent, if she didn't leave a very detailed message the first time, maybe she'd try again and let her know this specifically.
She sent her an email with all this info. Offering to pay for it and do all of it and also stating that it's in the best interests for all the property owners to be able to offer their property for sale down the road to FHA buyers. We'll see. I guess if she does ever agree to it, it would only take about a week to get completed.
So, at this point it's looking like it's not going to happen.