UPDATE:  Thank you for all of your responses!  I am representing the seller.  The buyers agreed to make the repairs before settlement to meet the FHA guidelines.  We had disclosed that there was a mold-like substance noted, but not tested.  The previous buyers home inspector pointed out what appeared to be mold, but was never tested.  The buyer backed out and came back with a lower offer and a repair estimate.  We submitted the repair estimate and convinced the short sale bank (NationStar) to accept $20,000 less for the property.  That same buyer backed out at the last minute due to personal problems that prohibited them from qualifying.  I felt obligated to mention the mold-like substance in the listing when I put it back on the market, although it had never been tested and confirmed to be mold.  We are one week away from going to closing with the new buyers.  The FHA appraiser is requiring a mold test and certificate based on what I noted in the listing.  He did not take any pictures of the mold-like substance, which leads me to believe that he didn't notice it in the house, but picked up on it in the listing after the appraisal.  The buyers are in the process of painting and installing a rail to meet the remaining requirements.  The buyers' agent is working on having the mold test removed as a requirement, because it is not pictured in the appraiser's report and it was never confirmed to be mold.  Tara Semtner referenced a case that she had below.  She was able to get her clients out of getting a mold test after she pulled the FHA guidelines and cited the applicable sections.  Thank you Tara Semtner for this information. 

Can anyone think of a way to get around this?  The appraiser noted the following FHA required repairs.  The short sale bank will not make or fund any repairs, because the price is based on the condition of the property.  The sellers cannot contribute.  These repairs would require time and a large sum of money from the buyer before settlement.  We are scheduled to settle on 6/17.  We have to settle before the end of the month, because the property is at risk of going to foreclosure.  Can money be set aside in escrow?  Has anyone ever dealt with a work around, so we can settle by 6/17?  If so, please let me know.       

FHA REQUIRED REPAIRS
*The Subject has peeling paint on the Eaves of the left side of the home and on a number of windows on the rear. These will need to be scraped and repainted. Basement Bathroom is currently unpainted and needs to be painted.
*The subject needs a railing installed on the 1st floor in the living room over the stairs in the split foyer.
*The subject has flooring missing between the BR or RR into the Bathrooms. This creates a tripping hazard and an uneven flooring area which will need to be remedied.
*The subject has what appear to have been water damage in the Basement Bedroom and possibly other areas as well. There is evidence of repair work but the listing suggests this may have resulted in "Mold Like" substances and it was not tested. This will need to be tested and if found to be mold, it will need to be removed and repaired. The appraiser is not an expert in this area and if mold is present then; a specialist will need to remove and repair and send the appraiser a letter or certify that it has been done. If it is not present then the results of the test saying that mold is not present.

Thank you!