Schedule

Working with a 203K Consultant

Do I need a 203K Consultant?

203K loans that require working with a 203K Consultant meet the following criteria:

  • The loan is for your primary residence
  • The loan is for remodeling and repairs
  • The repairs needed on the home exceed $5,000
  • Homes with repairs less than $35,000 that do not require structural work may qualify for a limited 203K loan which may not need a consultant.

The Process of working with a 203K Consultant:

  • Complimentary Consultation at property
  • Borrower provides the 203K Consultant with drawings or a written description of the work to be completed.
  • The 203K Consultant prepares an estimate of the work to be done as well as any additional legal exhibits required from the 203K Consultant for the loan. This is the “work write-up”
  • The 203K Consultant will meet with the borrower and the contractor at the property to discuss the schedule and the 203K Consultant’s estimate. The 203K Consultant will discuss the status of building department permits and inspections with the borrower and contractor at this time to make sure that everyone is on the same page.
  • When everyone agrees with the 203K Consultant’s estimate and indicates they are aware of the required permits for the project, the 203K Consultant will issue a certification to the Borrower and Lender for the 203K Loan.
  • In order to access funds, the Borrower will schedule “draw inspections”. These are 35 point inspections that that the 203K Consultant will perform to verify the percentage of the project that is complete prior to releasing funds. For example, 50% of the funds can be released when a draw inspection certifies that the project is 50% complete.
  • All fees must be paid and all work must be complete to release the final payment.
Click here for the explanation of the process from hud.gov

Fee Schedule for Work Write-UP

    The following fees apply for the work write up based on the cost of the work to be performed for the renovation.

    $400 – for projects that cost $7,500 or less

    $500 – for projects that cost $7,501- $15,000

    $600 – for projects that cost $15,001 – $30,000

    $700 – for projects that cost $30,001 – $50,000

    $800 – for projects that cost $50,001 – $75,000

    $900 – for projects that cost $75,001 – $100,000

    $1,000 – for projects that cost more than $100,000

    Draw Inspection and Other Fees

    $25/ hour drive time + $150 for the inspection + report for each draw inspection

    A $100 charge will be made for a feasibility study. A feasibility study by a 203K Consultant is not required for a 203K loan.