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Private Lending & Conventional Mortgage Advice

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Nate Raynor
  • Developer
  • Portland, OR
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HUD Loans and prevailing wages

Nate Raynor
  • Developer
  • Portland, OR
Posted May 24 2022, 13:04

Hi BP,

Has anyone looked at how much on a percentage adjustment of construction costs adding prevailing impacts costs? 

We are thinking about going the HUD financing route for our construction debt, but I've been trying to fully understand the cost implications of using HID. One of which is we will have to ensure we are using prevailing wages on the construction side.

Thank you!

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Caroline Gerardo
  • Lender
  • Laguna Niguel, CA
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Caroline Gerardo
  • Lender
  • Laguna Niguel, CA
Replied May 24 2022, 15:00

General is required to abide by Davis- Bacon and Cranston-Gonzalez Acts. Contractor provides reports and shows the payroll. HUD checks every bill. In today's construction market I could not find ANYONE who does a trade to work cheap. Your contractor files weekly reports. It is vital the general contractor has experience doing this major accounting endeavor.

Here are all the rules https://www.hud.gov/sites/docu...      40 pages makes it sound so easy, in reality it is not.

Lookup the subject address location for the dollar amounts. Every boot on site needs a valid social security number. The inspector will drop in and can stop you during progress.