When is a Feasibility report warranted for the FHA 203k program?
I hired a consultant out of state and for one of our lender clients. We provided a contractor's bid as the "wish list" with the entire project laid out and ordered a full consultation.
The consultant become invisible, no communication, none whatsoever, we tried to find out if the inspection had been set up... finally the borrower called to say he had completed the inspection, A week or two later the "consultant" turned in what he called a Feasibility Study, which we didn't ask for. It is just another way some of the consultants will try to get deeper into your pocket.
If you are going to run a business like a business it really is a good idea to communicate with the one that brought you to the dance.
Here is the issue... the Feasibility report was non responsive, it ignored the contractor's bid items and contained what the "consultant" thought should be done. Had this been completed properly as a consultation rather than a feasibility report it would have included the contractor's wish list items as well as other items that the "consultant" may have elected to call out. Then turn it in as a "work write up" so they can close the loan or at least have it to a point where it can be discussed... nope, he still hasn't communicated why he added all those items or blended them with the items already on the contractor's bid.
Is a feasibility report required on every 203k project - NO IT ISN'T. A feasibility report is typically needed if the scope of work is unknown and it is a purchase or the seller may order one to determine what FHA would deem as upgrades to satisfy the MPS (Minimum Property Standards). In the case aboe it was not required and shouldn't have been completed as it was.