FHA Streamline 203k Reno Financing

[Jerry Padilla]

Product Overview

LTV Requirements: Maximum of 110%

1-2 units allowed (3-4 units by exception only)

The Limited 203(k) may only be used for minor remodeling and non-structural repairs.

The Limited 203(k) does not require the use of a 203(k) Consultant, but a Consultant may be used.

There is no minimum rehabilitation cost.

Maximum number of contractors: 3

Repair Limits

• Renovation Total can be up to $35,000 in cosmetic repairs.
• This amount includes: 10% contingency reserve and all fees and costs listed in the fee section.
• Exceptions are not allowed to exceed the repair amount.
• Borrower is not allowed to fund overage.

Allowable Repairs

• Repairs and final inspection completed lesser of 180 days or as approved by the Renovation department
• Maximum repairs $35,000 (inclusive of all financed renovation fees). NO Exceptions.
• Roof: repair or replacement (covering, underlayment)
• Gutters/downspouts: install/repair/replace
• Insulation: ceilings/walls/asbestos removal
• Siding/windows/doors
• Paint: interior/exterior/lead paint abatement
• Kitchen: all appliances/cabinets/ total
• Electrical: repair/replace/recondition all
• Plumbing: repair/replace/recondition all
• Repair/Replace HVAC or other systems
• Repairing or removing an in-ground swimming pool
• Installing or repairing fences, walkways and driveways
• Flooring/subflooring/tile/carpet/wood
• Termite treatment/damage repair
• Repairing or replacement of well and septic- *See appraisal section of the guidelines for specific requirements
• Weatherization items/repairs/ improvements

Non-Allowable Repairs

• Structural or requiring engineers report or requiring blueprints
• Repairs performed by the borrower
• No Detached Garages
• No Swimming Pool Installations. Pool Repairs are allowed.
• Improvements that do not conform to the surrounding neighborhood
• Repair cost that exceeds $35,000. NO Exceptions.
• Any new construction including room additions.
• Landscaping or similar site amenity improvements.
• Any repair or improvement requiring a work schedule longer than six months.
• Rehabilitation activities that require more than two payments per specialized contractor.
• Major rehabilitation or major remodeling.
• Required repairs arising from the appraisal that Necessitate a “consultant” to develop a Specification of Repairs/Work Write-Up.”
• Require plans or architectural exhibits.
• Results in work not starting within 30 days after loan closing.
• Borrower is unable to occupy at closing or within 30 days.
• Television antenna and satellite dishes.
• Additions or alterations for commercial use.
• SFR conversion to a 2 unit

Contingency Reserve

• 10% of the cost of rehabilitation
• Properties where the utilities are turned off will require a 20% contingency.

Permits

oIf permits are required to complete the improvements, you must have permits prior to any subsequent draws after settlement. No Exceptions

Borrower Acknowledgment

• Parties listed below are not eligible to perform the work:
• Borrower
• Family Member
• Borrowers Employer
• Seller
• Realtor
• Any Interested party to the transaction

A family member is not allowed to originate or be involved in the loan process

• Family member as defined below:
• Child (son, stepson, daughter, stepdaughter)
• Spouse
• Parent (includes step-parent or foster parent)
• Grandparent (includes step-grandparent or foster grandparent)
• Legally adopted son or daughter, including a child who is placed with the borrower by an authorized agency for legal adoption
• Foster child
• Brother/stepbrother
• Sister/stepsister
• Uncle
• Aunt
• In-laws

Fees

• Single Fee: $550

Conforming Loan Amounts

• Maximum loan amount as determined by FHA (Conforming Loan Limits depending on location and number of units - below)
• Each county has its own individual area limit

High Balance Loan Amounts

• Maximum loan amount as determined by FHA (High Balance Loan Limits depending on location and number of units - below)
• Each county has its own individual area limit (refer to the following HUD website)

Upfront MIP

• 1.75% of the Base Loan Amount

Monthly MIP

Mortgage Term of More Than 15 Years Base Loan Amount	LTV	MIP	Duration
Less than or equal to $625,500
≤ 90.00%	.80	11 Years
> 90.00% but ≤ 95.00%	.80	Mortgage Term
> 95.00%	.85	Mortgage Term
Greater than $625,500
≤ 90.00%	1.00	11 Years
> 90.00% but ≤ 95.00%	1.00	Mortgage Term
> 95.00%	1.05	Mortgage Term

Mortgage Term of Less than or Equal to 15 Years	LTV	MIP	Duration
Less than or equal to $625,500	≤ 90.00%	.45	11 Years