FHA 203K loan- What do you know?

Question

What’s Up BP Community! Originally I have been approved for a standard FHA loan through a loan officer I met on BP for a duplex to house hack. I want to explore my options towards the Limited 203k loan as a first time owner occupant loan. I understand it will bring more of a learning experience on my part due to me being new In the game and from what I read the steps and procedures are more of an extensive process than a standard loan what lenders have you experienced are more likely to accept this type of loan? Overall what are Your thoughts and experience with this type of loan? Your input is very much appreciated and thank you in advance!

Jonathon Nila · Answer

@Matthew Porcaro thanks a lot I heard your story about 4 months ago and to be honest that is what pursued me to do the same on my first! I joined your FB site the 203k way great stuff! With me being approved 1st for the renovation loan now which is 2nd, 3rd and 4th steps to take Matthew in your opinion? Thank you for your time.

Paul Welden · Answer

Account Closed

The 203k Consultant is wrong and possibly committing Mortgsge fraud. Reference HUD SFH 4000.1.

The 203k Consultant is required to develop the scope of work and cost estimate without the use of a contractor.

Account Closed · Answer

@Paul Welden, I’ve posted recently about this, but when I was doing my research for the 203k loan process all the references I saw said that the consultant, after inspecting the property, would write up the SOR and the buyer could then use that SOR to help them get bids from contractors.  It helps the contractors to know all the work must be done, in addition to whatever other extras you want.  My consultant says that’s not the way he does it.  I can’t understand why.  Should a buyer sign a contract with a 203k consultant spelling out all the expectations?

Jonathon Nila · Answer

@Matthew Porcaro thanks a lot Matthew!

Matthew Porcaro · Answer

@Jonathon Nila

Time to start analyzing deals! I talk about how I did in my book if you have that. Use that as a reference!

Of course, if you have any specific questions don’t be shy to reach out.

Good luck!

MP

Matthew Porcaro · Answer

@Jonathon Nila

Absolute best decision to make. I did the exact same thing you’re doing. Bought a distressed duplex and house hacked it.

If you find a good lender, the rest will fall into place.

Also, get your contractors lined up early, otherwise you’re going to be scrounging for them while you’re in contract and that’s not fun.

Paul Welden · Answer

In a sellers market, the 203k can be a bit more challenging to get accepted by sellers.

Jonathon Nila · Answer

@Paul Welden thank you again! One more question I had? Since we are in a sellers market with low inventory do you think a 203k loan is a good approach at a time like this due to sellers getting 98% of asking price or above. with what I have read this type of loan is more extensive and  due to a more wider pool of buyers, what is your opinion with what experiences you have gone through with this specific loan? Thank you again Paul take care.

Paul Welden · Answer

@Jonathon Nila You can do all those things simultaneously which can give you more options to consider and not limit yourself.

Jonathon Nila · Answer

@Paul Welden thank you for the advice and i appreciate the response back on the forum! Paul should i personally look and find an off market property by generating leads,driving for dollars,cold calling, look for rent signs etc?or should i find a lender to get pre approved again? Or 203k Contractor?