I found a great property in central jersey but it needs a good amount of work. Has anyone had any luck with a good GC that is insured? I am getting a rehab, live in loan but every GC I talk to, do not want to deal with the bank. Any suggestions?
There are actually a few reasons you are having a hard time finding a contractors willing to work with 203k. Things always come up that are not budgeted for either by owners request or by necessity. Amount of money in the escrow is locked in so any extras have to come either from home owner or from the bottom line of the contractor. 203k homeowners don't usually have spare cash (hence why they applied for this product in the first place) but very often want higher end finishes or some extras. So you end up doing things just to wrap up the project at detriment of your own profit. The other reason is that bank never pays ahead so you end up working on credit. Depending how long it takes for bank to turn the paperwork around and disburse a payment, it may be a while before you can move on to the next part. Contractors like to get in and get out so you can move to the next project. The thinking in the industry is that you end up with subpar contractors because in-demand ones don't want to deal with above. You are better off getting a short term bridge loan and then refinancing into a long-term mortgage. I am biased though since I work with a contractor :) good luck.
P. S. You can try to search for contractors here https://203kcontractors.com/
Hypothetically, if I know someone who has a GC license and is insured, can they sign off as the GC while I am the one to hire the subs?
A) Is that illegal?
B) How does pulling the money out from escrow work? Is it by percentage of completion of the project like traditional GC contracts are or is it once 100% completion of the rehab is completed, the money is then released to the GC?