Listing all posts with label 203k contractor. Show all posts.
  1. Realtors, how would you like to sell every house you sell?

    I have told Real Estate Pros for over twenty years that the FHA 203k product should be in everyone's suitcase to be used as needed... BUT WAIT! I've also stated that every home sale should be an FHA 203k or other renovation type loan. They are available up to $3,000,000 loan amount that incudes purchase and renovation.

    Now back to the topic, you get a client and take them out to look at a few houses... inventory is low so you don't find anything that fits their needs exactly. Get back to your office and ask the buyers to review each house they saw today... make a list of the things they liked about each one and then what they didn't like about each one.

    Now take those lists and see which one has the least amount of changes they would like, explain to them that there is a loan that offers renovation, updating, additions, etc, and that would be the basis of your renovation sale. We can make those changes and hou make that sale right now. Remember that all of these renovation loans closes, you get paid, then the work is started. Your consultant will stay with the project till completion.

    In a few years when they are ready to sell and move on, you will likely be listing a larger home in better shape than what you sold them. 

    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..


    Mike ready for your 203k order Mike is waiting for your call  775-413-0451
  2. Why do they need 45-60 days to close a 203k loan? continued...
    ... Donna was curious of course, then I asked her how long does it take to close a standard FHA loan, the 203b? She said 15-21 days, then I told her the naked truth, "you can close a full 203k in the same time it takes you to close a 203b loan. We started her 1st 203k loan and she did everything right. She called the consultant out at the same time she started her loan process. We both headed down the path to the finish line together. [Most lenders will get all of their work done and call us to say "all we need is your report". These lenders will take 45-60 days to close because now all they have to do is call and interurpt us asking "how does it look?  [a total waste of our time to ask that]. 

    It seems so easy for me to understand that if you call me two or three times each day and break my train of thought... forcing me to calculate the possible completion time it is demoralizing to say the least. You are trying to bust your butt to get the job out. a key person on that deal is calling you, you pick up the phone thinking there is something wrong or they might have new input for the job and they say "how is it going?" Maybe some other consultants are much better than me but when I get on a roll and I'm writing that report, this totally blows me out. I then go get a glass of water and try to figure out where I was in the report writing phase. Read what I wrote last and try to complete that sentence. 

    BTW, Donna closed her first full 203k loan in 21 days and called to ask "why does everyone else say 45-60 days to close?". Donna is a shinning star in this business, She lets us start when she does. In all fairness the clock starts ticking once the lender has all of your financial paperwork but we can start the day you apply. HUD designed what we do to take 2 weeks then go to bid. We typically take about a week to achieve a report ready to go to bid. The contractors bidding the job may take several weeks, and that can hold up the process. I had a job the other day and the client met contractor 1 at the jobsite and asked for a bid. The contractor asked him who created his bid, the client indicated it was me, and the response was that he would do it for my bid numbers. He hadn't seen my bid numbers but felt confident that the numbers would be fair and it saved him allot of time. The client asked me for another contractor recommendation though he really liked the first guy. The second contractor came out and did exactly the same thing. If Mike bid the job I'm good with his numbers. 

    The client asked me for another so he is trying to get a bid from the 3rd contractor. This indecision can also slow down the process. We offer contractors a product we call "lost opportunity" bidding which is a great product for a contractor to use as it allows him to hire us when he doesn't have the time to bid a project. We do it for him and save him that time away from his other projects. If you are having issues with getting a contractor to bid your project give us a call.
  3. Studs with notches rendering them useless

    A stud is supposed to be a 2 x 4??

    This is what we found when the wall was opened. This has been supporting the house in part for nearly sixty years. LOL 2 x 4" studs on 24" centers then you just notch them out as you need to make the plumbing fit.... NOT!




    203k project - notch just in case you need one later... LOL
    Maybe you might need a notch sometime in the 
    future, just notch it out and save it till you need it.
    This is at a door way where today you would see
    a doubled up 2 x 4" stud since it is a doorway.













    Mike Young Team
  4. What if we don't complete our 203k project on time?

    You may need an extension of time to complete the project.

    Each construction project has an estimated date of completion set by the consultant or the lender and based on the amount of construction and not to exceed 6 months at the onset. Variables exist that include the current schedule of the contractor at the time of the closing. If the contractor is notified the loan closed and they can start working asap, does't mean they have to drop everything and begin your project.

    1) What really happens is that the contractor is notified of the closing,

    2) The contractor checks their schedule and decides that they have a project completing in a week or two and that crew will be sent to the new project at that time.

    3) Materials procurement then takes place, the contractor starts gathering the items they will need to complete you project. While this is going on the contractor will likely set up a meeting with the borrower's to lay out a plan of attack to get this porject completed asap. The contractor makes more money per hour the faster he gets the project completed. Therefore they will be anxious to get started and to get finished.

    All this is happening in the background and the borrower doesn't see very much happening and might be getting anxiety about their project. This shouldn't happen as they have been told what is happening behind the scenes.

    Once the project begins construction the contractor is under contract to maintain a crew on the job each day thereafter to insure a speedy conclusion to the project. At no time should the contractor cease work on the project for more than thirty days. I wouldn't let them wait more than a week before you call them and find out what is going on. There must be a draw inspection for work completed each thirty days from the close of escrow.

    If we look at this logically the first draw is typically is smaller than the future draws as there is less than thirty days of work. If the project is was originally set up to be completed in 4 months and we get to the 3.5 mark you will need to create and execute an extension request. The extension request should include the following:

    A) Reason for the delay

    B) Time line with a list of items not yet complete and an estimate of when they think each line item may be completed. This time line should be on the contractor's letterhead and signed by both the contractor and borrower. 

    C) New estimated completion date.

    If your project was originally set up for 6 months you could get up to five months additionally in this manner. Some just take a little longer but it is no one's best interest to drag the completion of a project manager 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. How to reset your Seismic Gas Shut Off Valve


    You can call a plumber to reset this little device and pay about $80 for the service. OR you can reset it yourself with a small screwdriver and a little 1/8 turn. there is a light that is red when tripped and green once you reset it.

    Is this device required to be installed on my home in Contra Costa County or Alameda County CA? Click here to see the answer.


    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 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

  6. How to make money consulting in spite of the HUD Guideline

    That's right. HUD in its infinite wisdom has come out with what was touted as the "new guideline" while in actuality it was not new at all with regards to 203k consultants. In fact it took us back to re-enforce the 1994 fee levels. An outrage for many of us as you can imagine. They don't go a year without an increase in their wages and expect us to go back 21 years for ours. 

    We have worked hard, building our businesses and when all other fees were deregulated in 2011 we took that as a good thing, though it turns out it was deregulated for all but our fees. Now a compliance inspector can get $450 to make a 2 minute inspection to see if a broken window has been fixed or not but we are expected to take $100 and look at how a home is put together. Is that window properly flashed, sealed, etc, on top of the broken glass repaired.  On top of that they now have dumped change orders on us and took it away from the lender… except some lenders want to “okay the CO prior to commencing the work” like they ever did that in the first place. Most didn’t, most rely on us in the field to make that decision for them.

    There has been lots of talk on the internet and blogs about how many of you are planning to get out of the business as you can’t possibly do a draw inspection for $100. You are absolutely correct. No one can and make any money at it.

    Join us for a 1-hour webinar and we’ll show you what you need to do to make money in this business in-spite of the Guideline. Yea, you gotta pay to see the solution, You will see how you can increase your profits substantially over the consulting work you have been doing provided you have been consulting properly... some of you aren't and weren't. The fee to attend this 1-hour session is only $49 and may run over with Q&A session.
     
    We’ll show you how to take your knowledge as a 203k consultant and turn it into a profit center for your business like you won’t believe till you see it, and no more draw inspections unless you want them.


    Learn how to make more money than the HUD Guideline suggests and increase your inspection fees legally in this 1-hour webinar. There is only room for the 1st 100 signing up in this first session, so sign up early. We will have additional events as the demand suggests.
    The webinar will show you how to make even more money than HUD pays. I just did one for another client that HUD would pay $1,000 and my fee was $5,500. Doing my second one this coming Saturday where my fee will be $7,500 or close to it. Still based on the construction amount. It is set up for December 28th 2015, 8-9 am PST. This will be the best $49.00 you spend this year and will get your new year off to a running start. Click here to sign up
    There is only room for the 1st hundred who sign up, others will have to wait for a future event.

    Be sure to send us an email to be notified of the next presentation

    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

  7. This isn't about the property or the consultant's job. I'm talking about the RE Agent or Broker that feels they need to control every aspect of the transaction or worse yet, the construction process. 

    I have a only a handful of people I have had to deal with over the years that want to control everything and it seems like "forever".

    Lets review the process again.
    1) Buyer finds a home. Agent or Realtor did a great job.
    2) Consultant comes on board get report turned in. Consultant did a great job.
    3) Loan closes. Loan officer did a great job. Agent was instrumental in the success.
    4) Construction starts - Contractor did a great job.
    5) Contractor wants to be paid - calls for a draw or progress payment inspection - Consultant (now a draw inspector) did a great job.
    6) Consultant (now a draw inspector) turns in the report for payment - Inspector did  a great job

    Note from step 4 on there is no Realtor or agent. Yet we have them now and then that feel they still need to be in control... NOT. YOU don't, it is not your place to be calling to find out if or when the inspection is scheduled. YOU should be going out and finding another house to sell. I was kind enough and made the mistake recently of notifying the RE Broker of an inspection and it was a harse reminder that I shouldn't have. I informed the agent or Realtor that the inspection would be at 10 am on Tuesday. What do you think happend? I get to the house, the roof is complete, or nearly complete, I need to see which so I get up the ladder and I'm inspecting the roof... my phone rings... huh? Why would the agent or Broker be calling me. They knew I'd be here for the draw inspection. It must be very important for them to be calling me. I'd better answer the call. 
    "Just wanted to be sure we were all on the same page" was the comment I received. What page did you think I would be on... LOL, I'm on the roof, I don't have the time while I have a contractor and his forman with me to inspect the issues they just want to get paid and NOT waste their time with me taking phone calls. If the borrower had been there, it would have wasted their time as well. 

    This is not the time to call the inspector. In fact it isn't the Broker's place to call the inspector for any reason other than a new project, and NOT at the time they know you will be conducting a draw inspection. What the agent thought was a good idea was merely a lack of respect for the process, the owner, the contractor and foreman and the inspector. It was a hinderance at best. Don't do it, please. A simple email "how did it go?" would have only wasted the inspector's time. Go sell another house. You aren't in the picture any longer. I know you just want to help, then help by not standing in the way of the process. 
  8. I heard another person telling clients they get $1250 for a 203k and you can get it all reimbursed in the loan back to the client. NOT true, sorry, but the only fee that is reimburseable per the guideline is the consultation fee and feasibility. NOT a separate home inspection fee. READ the guideline and you will see that a consulation includes a "203k home inspection". If you charged a home inspection fee then you can get your full consultation fee. A feasibility cannot or at least should not be charged unless you provide a feasibility report as well and most of the time you do not.

    If you charge separately for a full home inspection and deliver one, they you are entitled to be paid for your service but NOT from the 203k escrow, that would be against the guideline. I received a call from a HOC the other day where I was told we cannot sell any ansilary products as it would be a conflict of interest.  No termite report, no engineering report, no architectural services, yet we all have been doing all of the above as needed to get the job done faster. 
  9. The new HUD Guideline

    I'm getting lots of calls about how HUD can shove it and it has lots of consultants in a tizzy. STOP, please stop, let the dust settle a little bit. I was talking to a HUD official in DC the other day and was assured that thing are on the commissioners desk for signatures that changes all that we are reading with regards to our future fees. 

    In any case our fees are not determined by HUD, they are determined by each and every one of us as individuals. If you want to charge off the guideline and get 1994 pricing go for it. It isn't any more than an amount that HUD has determined is the maximum that they are willing to include in the loan amount. Yes it is grossly out dated and no, it doesn't come close to reality. 

    If these prices go into effect there will be so many areas where the public can no longer be served by this progam and that isn't typically HUD's idea of public service on their programs. Just "chill" for a bit and lets give my DC contacts some consideration and then, if it was a lie, the court system will be the next likely step. 

    Any lender that tells you what to charge is setting themselves up for a rude awakening. They have been trying to control our fees for at least twenty years that I know of and this rude awakening is likely the next step. If you want to be part of the cure, then get out your check book and be ready to spend a hundred bucks when that time comes. If we all do that, we will not only show unity but we will also so them we can no longer be pushed around.

    This is only HUD and not Fannie Mae so all isn't lost. If you want to be part of an even larger loan program that works like the 203k with limits up to $3 Million let me know and join the Mike Young Team of consultants nationally.

    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

  10. Contractors typically are used to getting 10% down at the signing of their contract, and another 30% when materials are landed at the sight. That hasn't been the case with a Standard 203k where they must work soley on their own credit and cash to get started then get "reimbursed" for each phase to get their money back.
    The "Limited 203k" loans, per the guiedline always provided 50% of the project cost for materials  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 still provide the full 50% per the guideline. Years ago I would see B of A, close the loan and in many cases it took them up to six weeks to provide the "50% up front money". These "limited 203k" project were quite often only going to take 30 days to six weeks to complete. They finally got with the program (years ago) and started providing the money from escrow at closing.

    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 [to be reimbursed at closing]);
    • prepaid architectural or engineering fees;
    • prepaid Consultant fees; [reimbursed to the borrower] [This can be added to your escrow instructions to be used as part of their down payment or closing costs too]
    • 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 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. Technically this goes into effect Sept 14th, 2015 but many lenders are going with it right now.

    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 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


  11. I need my 203k report in a RUSH!

    I bet you never heard that before, right? NOT

    There isn't a day that goes by that we dont' hear that "comical statement" why is it comical? Because most of the time it wasn't necessary. I just got one a couple days ago where they called me for a RUSH project on Saturday, asked that I rearrange my schedule for Monday but couldn't actually give me the order at that time. Just "could you do it Monday?" Trying to be accomodating I said "sure, we'll figure it out, but you need to place the order". They didn't, of course, but low and behold, I get a call Monday afternoon while having lunch in a nice restaurant asking me to be there in a couple hours. I can't believe the number of people that trivialize what we do and yet it is so important in the process.

    No paperwork prepared yet and no way to prepare it before the inspection. Then they failed to bring my check to the inspection. Funny how that works. 

    What do we do for our money? Create a scope of work, bid the job, and send it out to contractors to bid the project. This rush project was because they waited too long to order the report thinking it was a streamlined k (now called a Limited 203k). People in the business know that 98% of all problem 203k loans is due to the "Limited 203k" program where there is no-one to oversee the project. Had a consultant been brought in early in the process even as a home inspector then there would have been no need to "RUSH" anything. 

    FHA designed the consulting portion of our job to take two weeks, we have spoiled our customers and get them done in about 4-5 days typically and then they want a RUSH... too funny for words. The contractor will take 3-4 weeks many times to do what we do in 4-5 days. Your consultant needs time to do their due dilligence just as you do. When someone asks for a RUSH it is typically because they are poor planners and their lack of planning becomes someone elses RUSH. 

    Once you have a problem call our 203k911.com hotline and we'll help you through it or better yet, call us in the first place once you have an accepted offer and you won't experience the need for a RUSH order. 

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

    We have fourteen offices in CA covering both states of CA, 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 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

  12. What is a feasibility analysis or report?

    That is a great question as many, and I mean many, lenders get it confused with a consultation. Or worse yet the second half of a consultation.

    Let's start with the order. A lender typically calls in with an order for a feasibility report. This product is a quick trip to the site, no more than thirty minutes on the site for a SFR and a report that is generated about an hour after we return to the office. This report is a thumbnail sketch of the work to be completed to bring the home to the FHA Minimum Property Standards. Nothing more. Not enough for a contractor to use to create a bid. This is a tool to help determine the condition of the property with regards to the Minimum Property Standards that includes health and safety issues as well as most, if not all, structural issues.

    Where the break down occurs is when the lender calls everything a "feasibility report" and actually is ordering the "consultant report". The consultant report requires a much more extensive inspection of the property and a detailed scope of work, sometimes referred to as the SOR (Scope of Renovation). This report should be detailed enough for the contractor to make a bid short the final working drawings.

    There may be adjustments after the final working drawings are provided, if they are necessary at all.


    In one case we are asked to take a single story home about this same age with a front porch all the way across the front and create something that looks like this photo - to do this right we would need working drawings that might take a few weeks to get drawn up.

    In most cases the lender and borrower wants to close the loan about the same time that these plans might be ready to look at. Is it feasible? Yes, if the cost isn't prohibitive. Shall we order a "feasibility report" or do you want to close this loan fast and order the consultation?

    I recommend ordering the "consultation" and this will move the project fast forward to a close. What we do is meet with the client at the site. We already know their budget figure. If it appears they are way off the mark we flip it to a "feasibility" provide a report the borrower can actually use to renegotiate the purchase price. Then, if they are successful we go back out and do the "consultation" with the new parameters. 

    I see many lenders calling us out for a feasibility report when they are trying to close fast. That isn't going to do it. However they may actually mean to call us out for a 'consultation'. They each have their place so you really need to know the differences.
  13. Can you repair a foundation with the FHA 203k program?

    Yes, of course. this home had a basement but no perimeter foundation



    The photo to the left is day one, our initial inspection. The home has no perimeter foundation but it does have a small basement. Note the front
    entry door right in the middle of the front of
    the home yet no walk from the street to the
    front porch. Everyone enters this home by going up the driveway and entering from the rear.

    The photo to the right is after the weigth was taken off the home to allow the foundation to be installed.





    This is the home after it was set back
    down on it's new foundation. The front
    entry door is no longer in the front
    the front porch has been removed and
    the handrail has been extended to close
    that opening. The new ownder created 
    this to match the existing handrail.




    The rear of the home as it was at the time of my inspection.



    The scene to the right shows the rear of the home with the little bump out that had a low ceiling now removed and a new rear covered porch installed all the way across the rear of the home and you can see the new foundation.

    Notice you can see under the home in the left photo.


    The result after the rear porch was complete and handrail installed. The home now has
    some character and is likely worth a whole lot more than the original home.

    Some of our clients just seem to have a knack for creating value with their improvements. In this case they did a wonderful job of restoring an old home and updating it. They took out some walls at the interior and reconfigured the home to make it so much more functional than the old farm house had been.

    Oh, you want to see what some of the interior looks like? Okay, here are a few interior scenes.
     












                                   
  14. My 203k consultant isn't doing a good job of managing the contractor!

    Well, I don't know how to put this any other way but "it isn't the consultant's job to manage the contractor" so he or she shouldn't be expected to do that.

    1) The consultant is a consultant when first hired. They will consult with you and help you develop a plan to renovate the property. A "scope of work" or "scope of renovation" so that every contractor you might have bid this job does so with the same list of items to complete.

    2) Secondly the consultant can assist you in finding a lender or a contractor if you haven't found one. We typically know who can close these loans fast and who only talks a good talk. We can give you our "do not use" list of contractors but only in the event you have chosen one of them. Some contractors, a very short list, don't have a clue about contracting but have had the ability to pass the test and get their license.

    3) The consultant can assist you in choosing a contractor from the bids that have come in on the project. The lowest bid may not be the best bid. We had one not too long ago where we bid the job at $82,000 and the first contractor bid over $100,000 and the second bid at $67,000. Of course the owner felt they wanted the $67,000 bid. That is fine but we asked the lender to fund the $82,000 as it was pretty clear to me that they forgot something or made an error and we are not here to bankrupt a contractor. 

    4) Once the loan closes we are "no longer the consultant" however we then work for the lender as the "draw inspector" on our projects. 

    No where in our job description does it say we have to, or are expected to, manage the contractor. On the contrary we "consulted" and told you right up front that "YOU are the boss, YOU are responsible to choose the contractor, YOU are responsible to call the contractor and communicate your pleasure or displeasure with the contractor. 

    As an inspector to monitor the progress we are typically out to see the property about once every 30 days so "the borrower", being there nearly every day, must call the contractor and insure they are on the job when it appears they aren't.

    The Homeowner/Contractor agreement says very clearly that once the project begins the contractor should have someone on the project working each day until it is completed so feel free to call them and let them know when their employee(s) don't show up on the job. 

    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 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

  15. 203k loan limits don't go high enough for my neighborhood

    I'm afraid that is the harsh reality in many neighborhoods. What then, is the answer where the homes in my area are selling in the $1MM to $3MM or more. Not a problem at all. As all is good with another renovation product that is available and our group of renovation consultants can help you with that as well. This is just another reason that you should chose a "team" to close your loans faster.

    The parameters for the loan I'm referring to will be disclosed mid February but you can start inquiring right now. This lender loans in all fifty states and the permanent loan includes renovation money. The maximum loan amount is $3,000,000 and of course there is a higher LTV required so you could be buying a home in the $4-5MM range including renovation costs and with your down payment your loan amount would top out at $3MM.

    Get your renovation loans with one of our Team Members - Our consultant that cover this area is Pete Campbell

    Well, now the loan program is in full swing, you can place your order by clicking hereand filling out the short order form. 

    High balance renovation loans are now available from Chris Davis at Everbank. Chris will fill you in on the loan aspects of this product but the short of it is that you now have a renovation loan that covers the higher end home up to $3,000,000 loan amount.

    This is an amazing loan product and it doesn't have to be the entire amount... I've actually had a couple of calls where I was asked if we had a renovation loan for a $1MM purchase that needed $300,000 in renovation... YES, of course. LOL, the loan has a cap of $3MM but that means anything up to $3MM will likely fly just fine. I love this business.

     While this loan is going to be available nationally shortly, it is only currently available in the following states, AZ, CA, CO, CT, FL, MA, MD, NJ, and VA. Comming to all other states as fast as the local LO's in those states get their in-house training on the program.

  16. My fixer aquisition cost is $850,000 and it needs $250,000 in work

    Just got this call... YES, we can help you.

    Chris Davis at Everbank will guide you through their process. Just click on the link for Chris' web-page. It still has to appraise for the full amount including the renovation or in this example about $1.1 Million or so.

    Last week the question was for a $745,000 sales price and $150,000 in construction. Yes, these are now doable up to $3 Million loan amount. Not the typical LTV of course but Chris will fill you in on their guidelines for this product. 

    We had one a while back that, had it been a single family home would have worked out well for the $1.5 Million purchase and $625,500 renovation project. You can see that this opens up a whole lot more homes for renovations.

    Renovation loans greater than a million $




    Remember the one we did last year for an $888,000 purchase and $150,000, this loan would have been better for the client than the 203k was able to do.

    Now you have renovation financing for those higher end home.



    REO Realtors can move more of those high end foreclosures with this loan product.











    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 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

  17. What does a typical 203k project look like? Here are a few that we saw in the past year... 

     San Jose. Needed a new roof, heating system was well beyond it's useful life. Vegitation growing all over the home... clinging vines, dated kitchen and bathrooms. Seller ignored repairs for years thus a lower than typical sales price would be in order.

    Duplex northease of Davis. Lack of typical maintenace over a long period of time caused damage to wood members that might have been avoided with normal owner preventive mainteance. Seller should eat the loss here as this never should have gotten this bad.

    Typical 203k project 3SFR in Vallejo. This cute home just need some updating and weatherization.

    Typical 203k project 4SFR in SF had an illegal lower level unit. Someone convered the basement to a second living area but forgot to obtain permits and then failed to use common construction methods. Seller should carry the brunt of the cost in a lower sales price. 

    Pretty much anything is a typical FHA 203k renovation potenial property. If you are trying to sell a home with a bad roof or a marginal roof and it leaks just after the home is sold, you will likely get sued... not if you had suggested a 203k to replace that faulty roof as it would be a warrantee item. 

    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


  18. 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. 
  19. New SFH Guidelines Overview for 203k consultants

    Overview Conference Call for Mortgagees and FHA-Approved 203(k) Consultants
    FHA will host the following conference call briefing session that will provide an overview of the published versions of
    Origination through Endorsement’s 203(k) program and 203(k) Consultant sections:
    · Date: April 9, 2015
    · Time: 2:00 PM - 3:00 PM (Eastern)
    · Title: SF Handbook 203(k) Product and Consultant Requirements

    This may be a very interesting conference call. If you need th phone number and access code please contact us or HUD

    ** This turned out to be a very "non productive" call. They have made significant changes that throw more on the shoulders of the consultant and taken it away from the lender... then didn't address the consultant fees which haven't been revisited in twenty years. Inflation alone typically doubles the cost of things each ten years... example: $100 fee would become $200 in ten years under normal inflation and then $400 in the next ten years after that. Therefore our fees should be $400 by natural inflationary demands. Most of us are at $250-300 which seems fair to all and has been working well. Any type of control of our fees would be considered "price fixing" and is already against the law of the land. We may have to start a class action suit to get everyone to wake up that the guideline is just that "a guideline" and not an absolute. 
    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

  20. 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.
    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

  21. In 2009 the 203k loan program was out of this world. This time FHA has really stepped up to the plate. Every real estate professional should check the loan limits in your county or the counties you work in. In high cost areas you are back in the business with Jumbo loans that have rehab attached to them... if there is no rehab then FHA may still be your answer with the 203b. With loan limits in excess of $625,500 in 2015 "HIGH COST" areas and similar increases in all areas of the USA, this is the "Hottest Loan Product on the Market". FHA loans are easier to get, allow qualifying faster after a bankruptcy or foreclosure than conventional loans, and have higher loan limits in many cases than the conventional loans that may have dominated the market over the past few years, and the PMI has just been reduced substantially. 

    If you have a specific issue with a project you are putting together talk it out. We have had deals that were expected to fall apart when a client charged Christmas presents just before closing a loan and it threw their ratios out of wack... we were able to use the EEM (Energy Efficient Mortgage) features of the 203k to bring it back in line for closing on schedule. Please don't let a deal fall apart without giving us the opportunity to offer some suggestions that may keep that commission in your pocket. We're on your side.

    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 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

  22. This one gets me all the time. You forgot the case number, here it is please insert it on each page of the report. I'm surprised you forgot it with as many of these as you have done.

    LMAO, the case number is ordered after our report is completed and turned in. It is ordered when the order the appraisal, they can't order the appraisal till they know the cost of the repairs. It is a "catch 22" for sure. There isn't a week that goes by that we don't get asked to provide the case number on all the forms. It is actually a pretty simple thing to do with our proprietary software. We merely add the case number and reprint the report with a push of a button then send that pdf to the client and their lender. 

    If you are a 203k or a HomeStyle® Renovation Mortgage lender and would like to try our software for FREE to kick the tires please request it and we are happy to provide it to you. It is actually an asset to many who only do the streamlined k, soon to be renamed "Limited 203k". Our software output was voted "easiest to underwrite" by a 98% margin over our competition. If you haven't tried it ask for a free trial. If your consultants reports are adding correctly or are just leaving too much work for you.. give ours a try. 
    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

  23. It may sound like a good idea. I get my hearing aids next week, then maybe but for now... please use our order form. The GFE is also on page 2 of the order form.

    What happens if I'm sitting at my desk? It is great but the names I had thrown at me today were so difficult to understand for a partially deaf man. I felt like a fool having to repeat what I thought I heard several times. 

    So I think I finally have it... did I have to pull myself away from the project I'm working on and become a receptionist. Sure enough. You might say "don't answer the phone then." Right, you know what happens to a home inspector when they call and you don't answer that phone. They call someone else. It is always best to place the order in writing, we have a handy order blank and it makes it so much easier and I don't have to listen to the form and say "what?" too many times. 

    I am also an inspector and see homes 3-4 days per week. The other day I was in the basement when they called an order in. Fun to say the least. It keeps my life interesting. I think I'll try to turn on the microphone on my phone and see if it will transcribe the information. what an idea. Go ahead and call those orders in. LOL
  24. Can you add my contractor to your list?


    Sure we can. In fact this week we added another four or five.. All of them went something like this - 

    I get a call and they ask to be on our list, I tell them to send me an email with all of their contact information and they all must hear something I didn't say as they ALL sent 

    Name

    Company name

    Phone number, and of course I do have their email address.

    Possibly a web address, I guess that is so I can look it up more easily. 

    And that is all. Yep, that is what they think all of their contact information consists of. Yet when I input it into a report the lender expects a "license number", full address, not a PO Box, email address, name, company name, etc. 

    I must be saying it incorrectly as they all did it. What is so hard about 

    Name

    Company name,

    Full physical address

    PO Box if you have one

    Phone number

    License number

    I hope they know  that we need this so we can mail checks, visit their site to see they are really there, email paperwork to them, call them if needed. Did I say all them have been in business from ten to twenty years and still can't get it right?

    If you want your contractor on any list, make as easy as possible by providing all of the necessary information at one time on one piece of paper. One of them sent a second email and failed to reply to that one so I had the first bit of info, I had to find that other email to get him into the system. Ya gotta love 'em.

  25. 203K Training Center Offer an Overview of How 203k Consultants Complete a Feasibility Analysis Process


    Throughout a 203k project, stakeholders must complete the required documentation to ensure that the project is completed according to the industry regulations. During the 203k consultation process, 203k consultants will complete a feasibility analysis, which will determine the scope of the repairs required on the property. This complex process serves a unique purpose for both homebuyers and sellers. The team at 203k Training Center provides a comprehensive overview of the analysis process.

    Feasibility Analysis Provides Buyers a Foundation for their Decision

    Buyers will need to know, before the repairs take place, whether the value of the repairs will help them to receive a return for their investment. Properties must meet the minimum living standards set by the HUD. This often requires properties to go through significant levels of repair and means buyers must closely review the required repairs and the price of the property to ensure value is achieved. Buyers can also use the feasibility analysis as a means for seeking out specialist contractors. Many 203k consultants also work with buyers as they pick out contractors for the work, this is because the 203k project experts have experience in this process and can help to mitigate problems with poor workmanship and rising costs as the project moves forward.

    Analysis Could Help Streamline Negotiations

    With complete clarity of the levels of repair required within a 203k project, home sellers might be more willing to negotiate a deal with the buyer, thereby minimizing delays in the transaction. The feasibility analysis will highlight the costs required and will compel the seller to consider whether they are willing to pay for the repairs or hand the property over to a buyer to complete the property upgrades.

    Sellers can Achieve True Value Through their Feasibility Analysis

    A 203k feasibility analysis report will help sellers discover the true value of their property. With the information on the repair work required at their disposal, they can then present buyers with the facts on the property and determine whether they themselves wish to pay for the repairs. If the repairs are completed through the seller, they will then have leverage when selling the property in future.

    Realtors can Promote Properties More Effectively with Tangible Data

    The facts concerning the property within the feasibility analysis will also be of great benefit to the realtor. Giving the full amount of information to buyers at the beginning of the purchase process will help to improve communications between the buyer and the seller, thereby making the realtor’s job far easier and ensuring a more efficient working process.

    It’s important to work with trusted and qualified 203k consultants for a comprehensive feasibility analysis. To learn more on the process and its benefits, visit http://www.203ksoftware.com/. Qualified experts are standing-by to respond to questions.
    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

  26. The latest 203K Training Center Software guides professionals on How to Become a 203K Consultant 


    203K Training Center has recently introduced new software designed to streamline a professional’s path to becoming a qualified 203K consultant. The company’s 203K software for consultants will provide clients with everything they require to work with lenders and complete a 203K loan with seamless precision from their very first project.

    203K loans are designed to provide homebuyers the funds they need to both purchase and renovate their property through one singular mortgage contract with a lender. In order for both the lender and the buyer to be protected as part of the deal, a specialist needs to review the property and ensure that the property’s condition is suitable for a future 203K loan. It requires a special set of skills to begin analyzing potential properties for 203K loans, and these skills are now taught through the 203K consultant training software from 203K Training Center.

    203K Training Center is offering cost-effective pricing on their latest software, which has been designed to provide consultants with seamless entries into their 203K projects. Each solution offered by the company is designed to streamline such processes as populating forms necessary for 203K completion, as well as prompt consultants at various stages. In addition, the software will help generate the necessary reports for 203K consultants to complete their work effectively and within a limited timeframe.

    The software offered from the 203K Training Center is the most effective solution designed to streamline complex 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

  27. 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


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