203k Consultant Software

We have been selling the best 203k software available for the FHA 203k and HomeStyle® Renovation Mortgage by FannieMae for over 25 years. We have the longest running software available to consultant in the business. All the original competitors have gone by the wayside.
I remember a meeting in DC back in early 1995 as I recall. A competitor on the software came up to me and asked if I was the one with the software and promised to run me out of business.
Another couple of guys asked me if I would consider selling my business in CA, way back then. I asked them, who were they? The informed me that they were doing business in 5 states and had 50 projects going… They did not have a clue till I told them we had over a hundred projects going in one state. I suggested they sell out to me. LOL.
Our software was designed to allow you, as a consultant, the maximum speed to complete the project paperwork, and manage your draw requests.
A few years ago, I was asked to take over a couple of projects where the consultant used another software product. I thought I would just use their scope of work to do the draws. I should have l looked at them more closely. It took them 24 pages to write up the scope… mostly because it takes too much time to walk through 24 pages where most of them are blank or have a bit of info on each page. It took about 45 minutes to do each draw request… I was a bit perturbed. When I got back to the office, I had one of my guys transfer the data to our scope of work pages, it took 3 pages to say the same thing for each of the projects. A draw request should typically take 10-15 minutes at the site. If it takes longer, it may be that additional questions needed to be answered.
In the early days, the draw form had a front page and a back page that required signatures. I had set up a draw request procedure that would keep fraud under control. I went to the project site and met with the contractor, but the borrower was not there. The contractor requested that I leave the paperwork with him and he would get the paperwork signed and return it to me. Well, that did not happen. What did happen is that the contractor changed the amounts on page one of the paperwork where he had signed, then the owner came by and did not inspect anything, instead, he just blindly signed the paperwork. It was then hand delivered to the lender.
If that is not funny enough, the lender then called me with “hey Mr Guru, you failed to sign the draw request.” I had them fax a copy to me, yes, in those days we did use fax machines. When I saw the items were much more than what I had put on the forms, I told them it was not to be paid out, I needed to get with the borrower and contractor to see who, or if both, had committed this fraud.
I recommend to all consultants everywhere that they always sign last, and I see that isn’t being done by all. Had I signed the paperwork it might have gone through as a valid draw request and I would have been an unwilling participant in a fraud.
If you are a consultant and you have been signing the paperwork and sending to your client for their signatures, it is only a matter of time before you will be involved in a fraud. Do yourself a favor and always sign last after everyone else signs the paperwork.

Mike Young, 203k Team Leader 

We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. It really doesn't matter as we have associate offices in most every state in the USA. Find a consulant anywhere in the country.

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.com. If you are looking for quality 203k software for consultants to speed up the underwriting process..

Skype name: the203kconsultant

    

My lender asks for NO HOLDBACK on the draws

Why? That is just not good business. A consultant called today asking to see if we had a way to collect $0.00 hold back with each draw request. That would be against common practice, against common sense, and against the guideline. 

If you wanted to accomplish this in our software, you should print the draw request then adjust the numbers on page two to reflect a zero hold back amount. 
Mike Young, 203k Team Leader  

We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. It really doesn't matter as we have associate offices in most every state in the USA. Find a consulant anywhere in the country.

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.com. If you are looking for quality 203k software for consultants to speed up the underwriting process..

Skype name: the203kconsultant

    

203k Software for consultant and contractors

I get such a kick out of seeing new consultants who come on strong with their new software... only to find out they are paying per write up for the use of that software. The minute they fall behind on a montly installment they are out of business. 

We believe that when you purchase a software license you should have free use of that software to do as many projects as you like as long as you have that software in service.

There is little more satsifying than helping new consultants get it right. Too bad they had to start off with a "per use" product that is difficult to navigatge. Let us know when you are ready to try a better solution to your 203k write ups.

Mike Young, 203k Team Leader 

We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. It really doesn't matter as we have associate offices in most every state in the USA. Find a consulant anywhere in the country.

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.com. If you are looking for quality 203k software for consultants to speed up the underwriting process..

Skype name: the203kconsultant

    

How many draws are allowed on a 203k loan?

This has been misread for long enough - we are not held to only 5 draws

4240.4 REV-2 (5-2.C.) 2) Intermediate draws (four maximum) are inspected by the HUD assigned fee (or DE staff, where applicable) inspector (see paragraph 4-9).

If the cost of rehabilitation exceeds $10,000, then additional draw inspections are authorized provided the lender and borrower agree in writing, and the number of draw inspections are shown on Form HUD 92700, 203(k) Maximum Mortgage Worksheet.

Even HUD is guilty of misinterpretation of this. Now we have lenders who think on large projects there are only 5 draws allowed, 

I just received an accounting from a lender who charged $250 x 5 title update fees... they missed this in the guideliine

4240.4 REV-2
(1-13.)
E. Title Update Fee. To protect the validity of the mortgage position from mechanics liens on the property, reasonable fees charged by a title company may be included as an allowable cost of rehabilitation. Where the mortgage position is protected and is not in jeopardy, this fee may not apply. Borrowers may wish to obtain lien protection, but the fees must be paid by the borrower where such lien protection is not required to ensure the validity of the security instrument (see paragraph 1-20). The allowable fee should not exceed $50.00 per draw release. If all draw inspections are not made, monies left in escrow must be applied to reduce the mortgage balance.

Supplimental origination fee - The lenders get this fee and it is a minimum of $350 or 1.5% of the construction cost.  They think this fee is for writing 5 checks, and they are willing to take $70 per check, that seems reasonable to me... how about you?  But, watch what happens when the project is $500,000 in construction... they get 1.5% and they seem to think it is for writing those same five checks. They don't seem to understand this is to manage the additional draw inspections. Why would it make sense to pay them $1,500 each to write five checks.  Of course it doesn't make any sense at all.

ADDED 5/7/2021 - Handbook 4000.1 -  So, if you have a loan and the contractor fails to draw enough money with the first five draws leaving a balance in the construction loan... example, say they have $25,000 and they haven't finished the work. Choices are 1) foreclose on the home, no one wants that, 2) authorize another draw, and additional draws as necessary to complete the project... of course. When the guideline says "no more than five draws will be allowed" they mean to say "no more than five draws will be allowed to be financed into the loan." Additional draws may be paid with a change order authorizing funds from the contingency reserve to be used, or the fee can be paid in cash at the time of that draw. Either way is acceptable. I don't, however, recommend, taking a check as I one crooked client provide me with a check which she promptly stopped payment on. 
Mike Young Team Leader    

We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state. It really doesn't matter as we have associate offices in most every state in the USA. Find a consulant anywhere in the country.

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.com. If you are looking for quality 203k software for consultants to speed up the underwriting process..

Skype name: the203kconsultant

    

FHA well requirements Existing Construction 

My comments are inside the [   ]s

Guidline excerp from 4000.1 handbook which became effective on 14 September 2014

The new HUD Guideline comes out shortly. On 9-14-2015 the new Guideline comes out. This is NOT a reflection on the prices a consultant can charge for their services. HUD doesn't restrict what we can charge, only an amount they are willing to take on as a risk to the loan at this juncture.  Whatever they come out with on the 14th of September doesn't reflect a mandatory fee, only an amount that can be underwritten into their loan.

If the loan is for a total amount of $350,000 they can only stand to add $XXX to that and make sense in their model for insuring that loan. That merely means we have to pick all of our fee up front at the time of the inspection and only $XXX will be included in the loan amount. This is actually reasonable for them to do. We need to select a representative down the road to represent us. A level headed person who has "negotiating" ability. NOT someone who merely whines about our fees being too low. That isn't and hasn't been the right arguement ever. We can't win that arguement once you realize there is more to them increasing our fees than just pleasing us. 

Each of us has to determine what a "resonable fee" is for our work and realize that HUD is only telling us the part or portion of our fee that they are willing to underwrite and add to the loan for a 203k. I hope that is understandable as it actually does make some sense. Don't let any lender tell us what to charge that would open them up to a class action suit from us IF WE GET AND STAY ORGANIZED.

There may be some lenders or home owners that look at the guideline and think this is all we can charge, that is false. It is all that can be underwritten into the loan. 

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    

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.com. If you are looking for quality 203k software for consultants to speed up the underwriting process..

Skype name: the203kconsultant

    

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.