Has anyone used Fha 203k Loans in Colorado?

Question

Currently looking into the FHA203K loan and I was wondering if anyone in Colorado could share their experience, where they invested and what you would do differently after already going through it.

Thanks

Vincent Coleman

Jason Wray · Answer

Vince,

I can tell you as a Banker its a process that requires a lot of patience! There are a lot of success stories but in this market sellers and agents tend to walk away from 203K offers. If you have a diamond in the rough and its not getting a lot of action or offers it can be a learning experience.

You must use a licensed GC general contractor or builder who is approved. You cannot do the work it cannot be a friend or handyman. The budget is always set and if the GC or builder runs into problems or the costs increase, and they always do... Your out of luck.

Trust me not to be overly negative but the projects are never done on time in 90% of the cases.

My advice is find a home that will pass an appraisal and not be 'Subject to" after you buy it take out a renovation loan or a $50K personal loan and put that money to good use to maximize your ARV.

Jonathan Klemm · Answer

Hey, there @Vince Coleman - I haven't done the process in Colorado, but have completed the process several times both as an investor, agent, and general contractor in Chicago, Illinois. It's a golden ticket to equity if you can pull it off properly.

It might help to throw in some keywords of the cities you are close to, to find some local experts. By far the most important part is having a team that understands and has completed the process before.

Paul Welden · Answer

@Vince Coleman

Best advice is to organize the most qualified 203k Team possible. This includes the Lender, Contractor, & Realtor.

Lender - need to have verifiable 203k experience. The 203k lender controls the process, calls the shots, and manages the paperwork, funds the loan, selects the 203k Consultant, etc.

Contractor - any licensed, bonded, insured contractor is allowed to do the work, but that doesn't mean they know the different versions of the 203k , familiar with the unique 203k paperwork, processes, timelines, compensation structure, nuances, etc. Best to use a contractor who has been properly educated on the 203k, has sufficiently strong financials to pay for the startup costs and ongoing expenses for the 203k project. There is an accreditation called Certified 203k Contractor that verifies all that for you.

Realtor - need one who is not afraid of the 203k, can identify properties where the 203k can be used, and who can write the offer paperwork properly according to HUD guidelines.

You're only as strong as your weakest link --- select your partners wisely.

Hope this helps!

Has anyone used Fha 203k Loans in Colorado?

Has anyone used Fha 203k Loans in Colorado?

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