Listing all posts with label 203k consultant Santa Cruz. Show all posts.
  1. I need more money for my renovation project than the FHA loan limits. Is there a higher balance loan available for my project?

    Yes indeed, there is. There is another product out there than is available up to three million ($3,000,000) loan amount. Is it 3.5% down, of course not but typically when someone is looking at houses in that realm they quite often pay cash so a 65% LTV is fine.

    Just because that is the limit doesn't mean you have to borrower that entire amount. You can borrow up to that amount and the down payment is variable, the more you borrower, the higher the LTV. Make sense?

    We had a job the other day that had a purchase price of $745,000 and just over $115,000 in renovation, this program would fit this scenario. How about another where the purchase price was $1.5MM and it needed $300,000 in renovation.. on the surface it would work however it turned out to have 14 structures on the site and part of the construction would be to remove all but three of the structures and keep the log cabin and renovate it... NOT going to happen with this loan product as it specifically states "no log cabins". They must have seen that one coming.

    If you have a possible project please call us and we'll send you to the right people to get it funded for you. Remember that your consultant should be the first one on the job to help you with the scope of work and to help you find that "contractor" fit for your project. 

    Mike Young, 203k Team Leader    Mike ready for your 203k order

    We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state.

    To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation". If you like what you see here please take a look at Another blog by Mike Young in Spanish and other languages.

    Got a 203k project giving you "fits" contact www.203k911.comIf you are looking for quality203k software for consultants to speed up the underwriting process..

    Skype name: the203kconsultant

    following Mike Young on Twitter Facebook You Tube 203konline.com MY 203k Team bug

  2. There are "renovation loans like the 203k". The FHA 203k isn't always the best choice for the buyer. Many times the alternatives have better terms or better rates as they are intended for people who have better credit.
    Even if all other things are equal there is no private mortgage insurance (PMI) which saves 0.85% on the initial down payment and many hundreds each month. Yes, I'm afraid you have to have very good credit for the alternative loans but the cost is well worth the effort. This would be the Fannie Mae HomeStyle® Renovation Mortgage.
    It is always a good idea to look at all your options because the obvious solution may not be the best solution. Not all lenders offer all these different products.
    What else is on the horizon? How about the High Balance Renovation Loan product up to $3MM loan amount? This is now available as of today. If you are looking for a home in a high end area you now have a product to help finance the renovation and make the purchase or refinance up to $3,000,000 loan amount. This is fantastic. Call for more information.
    I had to laugh when a client called today and asked if we had anything for his $1.5MM project. Yes,  when we say up to $3 Million in loan amount that would include a whole lot of homes from $625,500 to $3 Million and everything in between. 
    Mike Young, 203k Team Leader    Mike ready for your 203k order
    We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state.
    To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation". If you like what you see here please take a look at Another blog by Mike Young in Spanish and other languages.
    Got a 203k project giving you "fits" contact us at www.203k911.comIf you are looking for quality 203k software for consultants to speed up the underwriting process.
    Skype name: the203kconsultant
    t_logo-a.png Facebook You Tube 203konline.com MY 203k Team bug
  3. If you have all the work you need already then maybe you don’t need to know about the FHA 203k loan program but there are allot of you out there that have been buying my eBook “Contractors and the 203k” indicating that many of you are becoming aware of this program. Why is that? Simply put “more business” than you can handle.

    When I take on a new contractor into our “203k Team” we ask one thing of them “Stop us before you get too much work from this program”. The last thing any of us want is for you to get a bad reputation for not being able to get these projects to completion in a timely manner and we have had some that don’t know when enough is enough until we start getting bad service. So… please just pull back a little when the time comes and then open the spigot again when it appears you are about 3-4 weeks from needing more work.

    There are two types of FHA 203k loans. I will describe the differences below and YOU need to know them and choose the right one for your circumstances:

    1) Full or Original 203k (started in 1961)

    This program uses a 203k Consultant to create a bid specification. That specification is sent to you, the contractor for your bid. It is typically a blind bid situation. In some cases the contractor has already put in a bid for the work they think will be required but in many cases they aren’t aware of the HUD Guidelines so they may miss a few things but overall this seems to cut down on the time it takes to close the loan so it isn’t all bad. If the borrower has several clients come out and bid the project prior to seeing us to create the “scope of work” it can be a mess. As much as the client tries to have them bid the same project if you don’t write it down each contractor will have their impression of what they thought you said and each bid will be slightly different and the client will not have a clear bid that they can use.

    I prefer to be the first one on the job to create the specification of repairs. I also will bid the job (never will do the work, just bid it) so the client has an expectation and we all know this project is still viable.

    There is no “up front money” for this program. The contractor must be well healed and have credit or money or both to get the project started. Since each draw must be no more than 30 days from the prior one the contractor should have enough money to carry his/her business, materials and labor for that period of time plus whatever they need to run the rest of their business. This program allows for interim draws and you can get partial payments for anything that is partially complete but only for completed work. Some lenders will follow the guideline and let you get money for cabinets and finished flooring up having it delivered and stored on site. Some lenders will advance 50% of the window and cabinet materials money only when they are custom sizes and the check may be made out directly to the cabinet maker or window manufacturer.

    This has been and can be a difficult situation for a small contractor or a contractor growing too fast. They need, heck, we all need “cash flow” which is the life blood of every business.

    2) Streamlined “k” (started in 2005)

    This program was intended to make the program easier to use for the majority of the lighter renovation projects. The significant thing with this one is that it cannot have any “structural” component. It is intended for smaller projects and though the maximum construction costs are limited to $35,000 per the Guideline in reality it is only $30,000-34,200. If you come up with Streamlined “k” loans where the work is $35,000 and your lender only does the Streamlined “k” you will be disappointed most of the time. The $35,000 must include the costs and fees associated with it. The $30,000 figure is due to the requirement of many lenders to maintain a 10% contingency reserved which takes a $30,000 right to $33,000 immediately.

    The big thing here is that there is “up front” money for the contractor of 35-50% of the construction cost. The project must be completed in no more than 60 days, and there is only one final draw at the completion. No other interim draws. 

    Mike Young, 203k Team Leader    Mike ready for your 203k order
    We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation". If you like what you see here please take a look at Another blog by Mike Young in Spanish and other languages. Got a 203k project giving you "fits" contact us at www.203k911.comIf you are looking for quality 203k software for consultants to speed up the underwriting process.
    Skype name: the203kconsultant
    t_logo-a.png Facebook You Tube 203konline.com MY 203k Team bug

  4. I'm still amazed at the number of asset managers that still insist that they won't take FHA offers. I was just listening to a weekly radio show featuring the 203k and the moderator hits them right between the eyes... 


    Asset managers, wake up and smell the roses, please. If you are excluding the FHA 203k you are not getting all the sales you could be getting for your clients. If there are any banks out there that have distressed properties... lol. Let someone familiar with the 203k list them for you... You will find that you will sell them faster, get more money for them, not have to fix anything, all work happens after you are paid and out of that asset. Yikes! It is everything that you want... 

    You want to get the economy back on it's feet fast then stop giving big banks bailout money they don't need. Let the banks, who have already written off the losses, donate their properties to the counties where they exist and take another write of. The counties then sell the homes fast at any price... satisfying their "affordable housing" requirements, gaining tax money, gaining new tax basis, and getting fixers out there on the market so local contractors get very busy, lots of them will have to hire people to get these home fixed up... home prices will stabilize and go up... maybe that is too easy.

    I heard a person on a radio show a moment ago saying that the best economy ever was in 2000... NOT. Think back a little farther back as I remember it was when we lowed taxes and let the people spend their own money... locally.  If we are looking for more stimulus reduce or eliminate the corporation tax on small corps or LLCs that don't make $200,000 this year... the people will start thousands of little businesses  and many will hire one or two but that will calculate to hundreds of thousands of jobs at the local level and not all highway jobs.  Sorry, but all corporations are not big companies

    I'm telling you, if you want to stimulate the economy then let's take the houses that have been foreclosed and turn them over to the cities in which they sit. Let the cities get the homes that the banks have already written off against other profits. If that were to happen you would see every community getting money into their local economy and creating jobs in their own neighborhoods, and providing meaningful work down at the grass roots level. Imagine if we put these jobs back on the market how fast we would see people shopping in the stores and the economy returning to a more normal situation. 

    Those of you in Santa Cruz be aware that Santa Cruz Home Mortgage has just made a commitment to do a lot of educating and 203k loans in that area. In fact Tammy Blanchard is in the middle of one right now. I'm sure if you give them a call you will find them receptive to bringing their training to your RE office to enlighten you. 

    Mike Young, 203k Team Leader    Mike ready for your 203k order
    We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation". If you like what you see here please take a look at Another blog by Mike Young in Spanish and other languages. Got a 203k project giving you "fits" contact us at www.203k911.comIf you are looking for quality 203k software for consultants to speed up the underwriting process.
    Skype name: the203kconsultant
    t_logo-a.png Facebook You Tube 203konline.com MY 203k Team bug


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