2. What is a 203K loan and how does it work?
Why do you need to know about 203K loans?
How will 203K Loans help you sell more houses?
3. What is a 203K loan?
The
FHA
203K
home
loan
program
is
available
to
owner-‐occupant
homebuyers
to
purchase
or
refinance
homes
that
are
in
need
of
repairs
to
meet
minimum
property
standards
set
forth
by
HUD,
or
for
homes
that
are
to
be
improved
or
modernized.
4. How it Works
One
single
loan
is
given
to
the
homebuyer
to
cover
both
the
purchase
price
or
exisHng
lien
(on
a
refinance)
and
the
proposed
improvements.
The
maximum
loan
amount
will
be
based
on
the
appraisal
value
aKer
improvements.
All
repairs
are
performed
aKer
the
loan
is
closed.
The
seller
is
never
responsible
for
the
repairs,
all
homes
sold
under
this
program
can
be
sold
“As
is”.
Basically,
there
is
a
single
loan
that
consists
of
“two
different
buckets
of
money.”
The
first
bucket
of
money
is
filled
with
the
funds
to
pay
off
the
purchase
price
or
exisHng
lien;
the
second
bucket
has
all
of
the
rehabilitaHon
funds,
these
funds
are
held
in
escrow
by
Movement
Mortgage.
The
rehabilitaHon
funds
are
released
based
on
a
draw
schedule
and
are
released
to
the
borrower
&
contractor
aKer
permits
are
issued
and
inspecHons
are
complete.
5. Why do you need to know about 203K loans?
• Foreclosure
&
short
sale
properHes
dominate
many
markets.
• Banks
sell
properHes
“as
is.”
• Sellers
bringing
cash
to
the
table
lack
funds
for
improvements
to
boost
sales
price
or
shorten
lisHng
Hme.
• Home
equity
loans
for
improvements
aKer
purchase
are
now
a
thing
of
the
past
unless
a
buyer
has
25%
or
more
equity.
6.
• PuYng
home
improvements
on
credit
cards
is
costly
for
homebuyers
in
both
high
interest
rates
and
high
monthly
payment,
plus
the
interest
is
not
tax
deducHble.
• 90%
of
homebuyers
remodel
aKer
they
move
in.
• 100%
of
homebuyers
have
those
“projects”
they
never
get
around
to
compleHng.
• How
many
Hmes
have
you
had
a
buyer
client
wanHng
specific
items
that
were
hard
to
find?
7. How will the 203K Loan be a crucial product
for your business in 2013?
8. • How
many
hours
have
you
spent
driving
homebuyers
to
lisHng
aKer
lisHng?
• Selling
a
home
in
need
of
repair
can
wear
you
down.
• The
203K
can
help
create
a
vision
for
home
buyers,
a^ract
more
buyers
and
provide
your
client
with
excellent
service
and
financial
results.
• Government
loans
offer
a
lower
down
payment,
less
restricHve
qualificaHon
requirements
and
in
most
cases
lower
interest
rates.
9. • Homebuyers
can
select
their
colors,
materials,
and
appliances
to
make
any
home
their
dream
home.
• When
it
is
Hme
to
re-‐list,
the
home
is
already
updated!
• Stabilizing
home
values
and
rebuilding
America
while
bringing
homeownership
dreams
to
life.
10. Streamline 203K vs. Full 203K
Streamline 203K
• Up
to
$35,000
in
repairs
including
conHngency
reserve
and
associaHon
fees.
• No
minimum
repair
threshold
• No
luxury
items
• No
structural
repairs
allowed
• Contractor
can
take
a
maximum
of
2
draws
Full 203K
• No
limit
on
repairs
• Minimum
repairs
$5,000
• HUD
Consultant
required
• Structural
repairs
allowed
• No
luxury
items
• Mortgage
payments
can
be
financed
(up
to
6
months)
• Contractor
can
take
up
to
5
draws
11. Dream Home Improvement Ideas
• Kitchen
renovaHon
&
modernizaHon
• Bathroom
renovaHon
&
modernizaHon
• Purchase
and
installaHon
of
appliances,
including
free-‐standing
ranges,
refrigerators,
• washer/dryers,
dishwashers
and
microwave
ovens.
• PainHng,
both
exterior
and
interior
• Flooring
• Plumbing
and
electrical
systems
• HVAC
systems
• Roofing,
gu^ers
and
downspouts
• Window,
door
and
exterior
wall
re-‐siding
• WeatherizaHon,
including
storm
windows
&
doors,
insulaHon,
weather
stripping
• Energy
efficient
improvements
• Lead-‐based
paint
stabilizaHon
or
abatement
of
lead-‐based
paint
hazards
• Accessibility
improvements
for
persons
with
disabiliHes
• Basement
finishing,
remodeling
and
water
proofing
• Exterior
decks,
paHos,
porches
**All structural repairs/improvements require a Full 203K.
12. Dream Home Improvement Ideas for Full 203K loans only
• Repair
landscaping
• Fencing
• Swimming
pool
repair,
limit
$1,500
• Major
rehabilitaHon
or
remodeling,
such
as
the
relocaHon
of
a
load-‐
bearing
wall
• New
construcHon,
room
addiHons
• Repair
of
Structural
damage
• Repairs
requiring
details
drawings
or
architectural
exhibits
• Any
repair
or
improvement
requiring
a
work
schedule
longer
than
six
(6)
months
18. What do I do if I think my client may
need a 203K loan?
Step 1.
Partner with the professionals at Movement
Mortgage. Your 203K experts!
Step 2.
Help your clients find their dream home!
19. How long does the process take?
At Movement Mortgage the average turn
time for a 203K loan is 9–20 days!
