203K Standard Loan Contractors in Atlanta, GA

Multi-Family and Apartment Investing
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203K Standard Loan Contractors in Atlanta, GA

Nastassiea Blankenship
Member since 2021 · 3 posts · 3 votes

Hello BP Family,

I have reached my FICO mortgage score goals for the interest rate I want. My goal is to buy a fixer upper in my desired area. Doesn’t even have to be in any good shape, as I will tear down and do a new construction. The GC referred by a program here in Atlanta quoted me twice the build of them home and a GC fee of $90k. The home is a little over 2900 sqft. Other homes similar build in the area ( even though the owners didn’t do the 203k route) were relatively less than the almost $500k quote. The reason I am doing the 203k loan is with a program that helps with down payment assistance and grants for building in historic Atlanta areas. 

Does any have similar stories here in the area or some contacts for contractors open to the 203k loan build process that can front cost on a net until its reimbursement through loan?

I can may find a GC that other contractors can build under their license. Also, the reimbursement check will be made out to both owner and contractor? If I front some costs up front, can I cash check myself and get my money back then pay contractor? 

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  • Justin Goodin
    Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes
    5y

    @Nastassiea Blankenship I do not have any experience with 203K loan. Maybe somebody else will. I would get multiple bids from GCs.

    0Reply
  • Paul Welden
    Real Estate Agent · Tempe, AZ · Member since 2011 · 1k+ posts · 543 votes
    5y

    Generally, the price for rehab on a 203k will cost more than an identical rehab when not using a 203k. 

    Contractors doing 203k rehab on the Standard version incur additional costs and are required to do much more paperwork and admin work compared to non-203k rehab projects. 

    Plus, there's no $$$ upfront for the contractor and the contractor basically has to finance the project. 

    I always recommend to use contractors with the designation as a Certified 203k Contractor which are found online at 203kContractors.com. Don't worry if there is only 1 or very few available, because the contractor doesn't necessarily set the price for the project ... the 203k Consultant does that. 

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  • Paul Welden
    Real Estate Agent · Tempe, AZ · Member since 2011 · 1k+ posts · 543 votes
    5y

    Lenders do reimburse the contractor via 2-party check and I'm fairly certain they can only be deposited/cashed with the written approval of both parties. 

    Borrowers can be reimbursed for materials they purchased from the 203k rehab account as long as the materials were included/approved for the 203k loan and the materials must meet FHA MPR/MPS and the contractor must also agree to let you do that as well.

    Some contractors have a markup on materials and a customer buying their own materials can take away some of the contractor's potential profit. You and the contractor should work together as a team. So, check with your "partner" first before doing anything. 

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  • Paul Welden
    Real Estate Agent · Tempe, AZ · Member since 2011 · 1k+ posts · 543 votes
    5y

    The 203k does not permit building of new homes. It can be used to rehab existing homes. You can use a 203k to tear down an existing home and build a new home as long as the original foundation remains. 

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  • Nastassiea Blankenship
    OP
    Member since 2021 · 3 posts · 3 votes
    5y
    Originally posted by @Justin Goodin:

    @Nastassiea Blankenship I do not have any experience with 203K loan. Maybe somebody else will. I would get multiple bids from GCs.


    thank you for the feedback. I’ll be trying to get multiple bids

    1Reply
  • Nastassiea Blankenship
    OP
    Member since 2021 · 3 posts · 3 votes
    5y
    Originally posted by @Paul Welden:

    Generally, the price for rehab on a 203k will cost more than an identical rehab when not using a 203k. 

    Contractors doing 203k rehab on the Standard version incur additional costs and are required to do much more paperwork and admin work compared to non-203k rehab projects. 

    Plus, there's no $$$ upfront for the contractor and the contractor basically has to finance the project. 

    I always recommend to use contractors with the designation as a Certified 203k Contractor which are found online at 203kContractors.com. Don't worry if there is only 1 or very few available, because the contractor doesn't necessarily set the price for the project ... the 203k Consultant does that. 


    Thanks!! I appreciate the detail responses. This is very helpful. 

    1Reply
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