The 203k Home Loan Process-What a 203k Consultant Does For You | Having a 203k consultant is a bit like having your own, personal, project manager. Their role is invaluable to the process of renovating a home using a 203k home loan. Your 203k consultant will not only complete your initial on-site visit, but will actively monitor the progress of your home’s renovation. 203k consultants work diligently to assure that your home repairs are up to HUD’s minimum property standards. But don’t worry, they’ll also include all the little extras you request to make your house a home!
So, what exactly can you expect from your 203k consultant? First, he/she will meet with you at your property and conduct an initial inspection. This inspection will determine the feasibility of the project, and if a green light is given, you’ll sign a consultant agreement and get the show on the road.
Following the site visit, your 203k consultant will complete a detailed write up, needed by you, your lender, and your contractor before moving forward. This write up includes concise project specifications and its cost breakdown (including contingency funds for the just in cases!), HUD draw request documents, lender packages, and contractor bid packages. Once you are in possession of this write up, the next step is choosing your contractor. While the borrower ultimately chooses their own contractor, it is important to mention that lenders generally have qualification criteria that contractors must meet to be chosen. With this your loan will close, repair funds are placed into escrow, and your construction can begin!
With your first draw from funds, it is confirmed that all proper permitting has been completed. Who is responsible for this? Your 203k consultant, of course! From this point forward until completion of the project, you’re 203k consultant will monitor the project and meet different requirements before each subsequent draw. The 2nd and 3rd draws are completed after your consultant confirms that certain points in the project have been reached and that the work is satisfactory. At time for the 4th draw, your 203k consultant will create a punch list of items for the contractor to finish. The 5th, and last, draw signifies the closure of the project. At this time warranties and lien releases are collected.
To find out if a 203k consultant is right for you, check out more information on our website or give us a call today.