Hi I'm a Realtor and I've never written an offer using the FHA 203(K) Loan

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Mortgage and Lending

Hi I'm a Realtor and I've never written an offer using the FHA 203(K) Loan

Once you receive the written Pre-Approval from the lender and your buyer has located a property make the offer with a provision in the sales contract that "The buyer has applied for Section 203(K) Financing and "The contract is contingent upon loan approval and the buyers acceptance of the additional required improvements as determined by HUD or the lender.

The expense of the Preliminary Feasibility Analysis is charged to the buyers of the property in advance of the loan closing but is refunded back to them at the time of the loan closing.

Should the buyer back out upon the results of the Feasibility Analysis; the fee is NOT refundable.

Search here for a local Certified 203(K) Contractor to do your Preliminary Feasibility Analysis.

It is important to remember that HUD may require additional repairs that the borrower did not plan on doing.The additional repairs must be completed in oder to secure any loan.

Posted by

Jim Poole

Senior Loan Officer NMLS #351358

813.205.7958 Mobile

jptampa@live.com 

 

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hi im a realtor and ive never written an offer using the fha 203k loan

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Rainer
36,078
Melanie Thompson
Mortgage Equity Team - Lynchburg, VA
Registered Mortgage Advisor

Great verbiage, Jim. Just closed a full 203k refinance yesterday.

Borrowers also need to be cognizant of the contracts they sign. The Consultant may add items not reflected on the itemized builder contract and it's imperative to ensure the builder-borrower contract includes the very fine details of the project (gutters, bathroom mirror/towel bars, repairs to hardwoods when pulling out systems). Without those details, the borrower may end up penalized financially.

Keep adding value to the marketplace with renovation loans!

Feb 16, 2011 03:13 AM #1
Rainer
161,750
Jim Poole
Tampa, FL
Zero Down, USDA Purchase Loans, FHA 203(K) Rehab & VA Streamline Loans

Thank you Melanie the devil is in the details even on this type loan; so good stuff. Thanks!

Feb 16, 2011 03:43 AM #2
Rainmaker
418,551
Rodney Mason
Guaranteed Rate - Atlanta, GA
Licensed in AL, FL, GA, SC, & TN

I had one recently where the buyer thought he could do several of the repairs himself.  Needless to say, I was not told about the other issues until the appraisal was completed.  I think that having a HUD Consultant even on Streamlines is well worth it.

Feb 21, 2011 01:13 AM #3
Rainer
161,750
Jim Poole
Tampa, FL
Zero Down, USDA Purchase Loans, FHA 203(K) Rehab & VA Streamline Loans

Couldn't agree with you more Rodney. We employ a full time HUD Consultant just to assist us in getting the files done correctly.

Feb 21, 2011 03:45 AM #4
Rainer
18,550
Jamie Woods
Home Savings of America - Hudson, NH

Right! The only way a buyer can do the repairs themselves is if they're a licensed contractor of that type of work to be done, and that's according to the rule book. If I remember correctly they also have to get "cross-bids" in case they become physically unable to perform the work quoted after the loan closes and gets the FHA endorsement. Finding an underwriter that will sign off on a "do-it-yourselfer" 203(k) loan why, that's a different story. Man the 203(k) is a GREAT product but there isn't a more paperwork-intensive type of mortgage to originate. I used to originate and process them up here in New England because it was the only way to ensure they were done right. I used M&T Bank and Wells to close them. Again, three times the work, but ten times the reward knowing you've enabled the beautification of a property and neighborhood.

Keep helping make Florida beautiful! And awesome that you specialize in VA, too.

Jamie

 

Feb 22, 2011 08:26 AM #5
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Rainer
161,750

Jim Poole

Zero Down, USDA Purchase Loans, FHA 203(K) Rehab & VA Streamline Loans
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