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Listing all posts with label 203k consultant Seattle. Show all posts.
  1. Can I build a garage with the 203k program?

    Sure you can - but wait a minute 
    Build a garage with the FHA 203kYes, you can if there is no other garage on the site. If you do have a garage on site, then the new garage may be considered a luxury item and thus not be allowed.  If you have a home that just needs a garage to be complete, build one with the FHA 203k, no problem.

    If, on the other hand, you have a two car garage and want to build a new detached garage too, No Can Do. This is a luxury item.

    You can build a detached garage if you want to providing there is no other garage and there is no living area over or attached to that new garage structure.  If there is to be an in-law unit above the garage or in any way attached to that garage, the new garage must share a wall with the existing structure.

    In 1994 we were taught that we could attached with breezeway but that is no longer the case. The guideline is being interpreted and misinterpreted to meet the current regime.

    Why do I say misinterpreted? Simply because they still think "only 5 draw inspections can be financed into the loan" which other lenders interpret means no more than five draws are allowed. That part of the guideline actually states "On a project of $10,000 no more than five draws are allowed". They all quote the last half of that sentence but clearly by any rational person's interpretation on a project of $250,000 in construction maybe there could be a few more.

    Attention Realtors, you have a client and you have found the best house in the world for them but it doesn't have a garage, attached or detached. No problem, it is an FHA 203k loan. Sell them on getting a 203k consultant and having their new loan include the cost of the new garage. Right now that is about  $20-30,000 depending on the size. We just finished a two-car detached garage for $28,000 that was over sized to accommodate a small work shop and another that was $20,000 without a garage door. The borrower wanted to get that outside the 203k. 

    This home fit the client's needs in every other way than the garage. A couple acres, but the built-in garages had been coverted with permits and now they just had a carport under the deck. This actually made the home perfect for this couple who was also a licensed contractor.

    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. Can I build a detached garage with the 203k program?

    Yes, and No
    Yes, you can if there is no other garage on the site. If you do have a garage on site, then the new garage may be considered a luxury item and thus not be allowed.
    If you have a home that just needs a garage to be complete, build one with the FHA 203k, no problem. If you have a two car garage and want to build a new detached garage too, No Can Do. You can build a detached garage if you want to providing there is no living area over or attached to that garage structure.  If there is to bre an in-law unit above the garage or in any way attached to that garage, the new garage must share a wall with the existing structure. In 1994 we were taught that we could attached with breezeway but that is no longer the case. The guideline is being interpreted and misinterpreted to meet the current regime. Why do I say misinterpreted? Simply because they still think "only 5 draw inspections can be financed into the loan" which other lenders interpret means no more than five draws are allowed. 
    That part of the guideline actually states "On a project of $10,000 no more than five draws are allowed". They all quote the last half of that sentence but clearly by any rational person's interpretation on a project of $250,000 in construction maybe there could be a few more.

    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

  3. We have your back when it comes to remodeling

    That is just what it means to be a 203k consultant or renovation/remodel consultant. Most people don't remodel their home very often and guess who knows it? That is correct, the contractors know it and quite often they capitalize on it. 

    The task was to add a second story to this home and change from a "bungalow style" home to a 2-story "craftsman style" home with a budget of $150,000, well, it couldn't be done but I felt it could be done for $159,000 plus contingency and the borrower agreed that it was still doable so we moved forward.

    It is my job to create a scope of work and give you a bid on what I think a contractor should be charging for this specific SOR (scope of renovation) as so many lenders call it. If your consultant isn't bidding on this project before you solicit bids from the contractor(s) then your consultant ISN'T doing their job and you are not getting all of the service you are paying for.

    Next step is for us to print out the SOR without prices in it and give it to the borrower to use to solicit bids. We don't like to let this out of our control so we send it to the borrower's contractor selection with a copy to the borrower so they can see our comments to the contractor and that way we maintain control so the lender can close the loan quickly.

    Once we have a "confirmed bid" from a contractor so our bid is "validated" the appraisal is typically ordered. Many will order the appraisal with our bid paperwork as the scope of work doesn't change, only the price may change slightly.

    Now the bids come in. In this example the borrower had a contractor but she made a crucial mistake, she let the contractor know that she was so excited to have them working on her project to take this bungalow home and turn it into a "craftsman" style home. Her contractor bid the job at $298,000 versus my bid of $159,000. Yikes! What do we do now?

    That is easy. We sent it out to another contractor that neither of us had any experience with, no preconceived notions. The second bid came in at $161,000. Just 1/2% higher than my original bid. 

    Conclusion: Rest assured we have your back. When the contractor's know that they will typically bid a bit tighter in the first place.

    This has become more and more important for you since our purchase or refinance and renovation loan limits have climbed to $3,000,000. There are lots of homes in our area that qualify for these higher loan amounts. We had three last week that were purchases at nearly a million dollars plus the renovation money which is well over the FHA and FannieMae loan limits. Not a problem, we have you covered.

    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. This post is for our St Lucie County office. 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 quality 203k 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

  4. 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

  5. Limited 203k, the new name for the old Streamlined k product with FHA. Where you get the money to purhase or refinance a 1-4 unit property and get the money to make the repairs or upgrades all in one low interest loan. 

    You can always tell when a lender is transitiioning into the standard 203k realm when they have been doing the limited 203k for so many years. It is easy because they ask for an invoice from the contractor for the items they want to get paid on. Not necessary for the lender to do that. 

    On a limited 203k that practice is common practice but on a Full or Standard 203k the draw request prevails and is the only required paperwork from the contractor. 
  6. HUD/FHA felt there was too much confusion with the name Streamline k versus the FHA Streamlined Refi and it was a bit confusing to those who hadn't heard of the 203k. Why hadn't they heard of the 203k is beyond me. It has been around since 1961 and is going stronger than ever.

    Sreamline k loans now and hereafter referred to as "Limited 203k" loans always provided 50% of the materials cost up front to the contractor unless you were dealing with a lender like Wells Fargo that only allowed 35% or Prospect Mortgage at 40%. Most other lenders provided the full 50% per the guideline.

    The new rule as it is proposed for

    Standard 203(k) transactions, Mortgagees may disburse the following at closing:

    • permit fees (the permit must be obtained before work commences);
    • prepaid architectural or engineering fees;
    • prepaid Consultant fees; [reimbursed to the borrower]
    • materials costs for items, prepaid by the Borrower in cash or by the contractor, where a contract is established with the supplier and an order is placed with the manufacturer for delivery at a later date; and
    • up to 50 percent of materials costs for items, not yet paid for by the borrower or contractor, where a contract is established with the supplier and an order is placed with the manufacturer for delivery at a later date
    • For any Disbursements paid to the contractor, the Mortgagee must hold back 10 percent of the draw request in the Contingency Reserve.
    This is actually a pretty big thing. This will allow us to get reimbursed for materials... materials at 50% of their cost at the close of escrow. By paying that directly to the supplier with proper 1099 form and invoice copy for materials they can get the money at close of escrow. This should speed things up considerably for getting the big ticket items deposits paid for up front at the closing. 
    While the permits and some of the other fees has been the case for yers the 50% of some of the materials costs paid at close is going to help allow more contractors the flexibility to do more 203k projects.
    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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