The FHA 203(k) Streamline Renovation Loan

Overview of program:

Limited Repair Program
1-4 Units – Purchase and Rate/Term Refinances
Less Documentation
Elimination of HUD Consultant
Less fees associated with repairs/product
1 Title Update
Maximum of $35,000.00 in repairs (including financeable costs) & No Minimum

Streamline 203k Value Proposition:

Solution for Appraisal Issues, required or desired repairs/updates and other improvements.
Lend up to 110% of appraised value
Homeowners can make the house they are buying into the home of their dreams…..paint, carpet, appliances, etc.
Competitive advantage in the marketplace

Allowable Repairs:

Roofs, Gutters, Downspouts
HVAC Systems
Plumbing, Electrical Systems
Existing Flooring
Minor Remodeling such as kitchens—no structural repairs
Interior and Exterior Painting/Siding
Weatherization including storm windows, doors, insulation, weather stripping, etc.
Appliances—No dollar limit
Handicapped Accessibility
Lead Base Paint Abatement/Stabilization
Repair, Replace, Add Exterior Patio/Porch
Basement Refinishing and Remodeling does not require structural repairs
Basement Waterproofing
Window and Door Replacement
Septic and Well Systems/Repair and/or Replace

Ineligible Work Items:

Major Rehabilitation or major remodeling such as relocating a load-bearing wall
New Construction including additions
Landscaping or similar site amenity improvements
Rehabilitation activities that require more than 2 payments per specialize contractor

Ineligible Transactions:

Repair Does Not Appear on the Streamline 203K Eligible Work Items List
Repairs that Necessitate the use of a Consultant to develop a Work Write Up
Require Plans or Architectural Exhibits
Require a Plan Reviewer
Require longer than 6 months to complete
Result in work not starting within 30 days of closing
Would cause the mortgagor to be displaced for more than 30 days during the rehabilitation being conducted

Borrower Responsibilities:

Selecting Contractor
Cost Estimates for all the work being performed
If a National Home Improvement Company is used, such as Home Depot, Sears, Lowe’s borrower must provide a detailed cost estimate, receipt or invoice
Self Help allowed on case by case basis

Contractors Responsibilities:

Each contractor must complete all documents in the contractor package which include:

Builder Validation Statement
Homeowner/Contractor Agreement
Provide copy of License (if applicable)
Notice To Contractor
W-9
Provide Proof of Insurance

Renovation Loans - What's different:

Products:

Fixed 30 Arms 5/1, 3/1, 1 year

Waterfield Mortgage

Processing, underwriting and closings in branch with 30 Day Closings

Our Mission Statement:
“We Lend on after-improved value” but can close “AS-IS”

Advantage to Realtor Partners

1) Hard to sell properties
2) FHA appraisal problems
3) Mixed use properties
4) All renovation completed after closing
5) Sensible way to list properties
6) One time close