Download - 203 k realtor ppt1
Agenda:
To answer the following questions:
1) What is a 203K loan and how does it work?
2) Why do you need to know about 203K loans?
3) How will 203K Loans help you sell more houses?
How it Works:
FHA’s 203K program permits home buyers to finance additional repairs into their mortgage to improve or upgrade their home before move-in. With this product, home buyers can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a home inspector or FHA appraiser.
Why will the 203K Rehab Loan will be a crucial product for your business in 2011?
1.2 Million Foreclosures predicted nationally for 2011.
Hampton Roads could see as much as 40% of available listings foreclosures in 2011
Banks sell properties As/Is,
Government loans ( FHA/VA – Little or No down payment) more prevalent than conventional loans requiring 10% to 20 % down payment.
How many times have you had a buyer client wanting specific items that were hard to find?
90 % of people who purchase a home repair or remodel after they move in.
100% of people have those “projects” they never get around to!
Using the 203K your buyers can complete their dream projects BEFORE they move in!
When it is time to re-list, the home is already updated!
Example:
FHA 30 Year Fixed
New Home Purchase: $200,000.00
Principal and Interest payment @ 4.75% $1145.00
Cost of Improvements: $25,000.00
Visa / Mastercard Payment : approximately $500.00 a month
Total: $1645.
Example:
FHA 203K
Sales Price $200,000.00
Cost of Improvements: $25,000.000
Loan Amount $227,741.00
Principal and Interest payment at 5.00%: $1244.00
Monthly savings: $401.00
Standard 203K Product
No Limit on repairsMinimum repairs $5000.00HUD Consultant write up requiredStructural Repairs AllowedContingency Reserve requiredPayments can be financed (up to 6 months)No luxury items Contractor can take up to 5 drawsUp to 4 unit multi family
Streamline 203K Product
Up to $35000 in repairs allowed ( to include fees associated with repair costs)No minimum repair thresholdNo luxury itemsNo structural repairs allowedNo FHA consultant requiredCan be used for refinance primary residenceUp to 4 unit multifamilyContractor can take a maximum of 2 draws
Before After
Before After
Before After
Before After
Before After
What do I do if I think my client may need a 203K loan?
Step 1.Partner with the professionals at New American Mortgage. Your 203K experts!
Step2.Help your clients find their dream home!
FHA consultant provides a work write up. ( Not applicable to Streamline product.)
Contractor provides an itemized estimate of repairs that should match the work write up.
Appraiser determines after improved value.
Maximum loan amount is 110% of after improved value.
What are the extra costs involved with the loan?
Contingency reserve: 10 % to 20 % of repair costs.
Title update fees
Inspection fees
Supplemental Origination1.5% of repair costs or $350.00 (whichever is greater)
Consultant fee. ( If applicable)
How long does the process take?
At New American Mortgage the average turn time for a 203K loan is 9–20 days!
How do we do it?
Easy…every loan has the same CTC date.
What’s a CTC date? …..Clear to Close…….