What Is a 203K Consultant and How Can This Person Help You Buy a Home?
People who are interested in buying a damaged or older home and repairing and renovating it can finance through an FHA 203K loan for the cost of the house and necessary renovations. If, for example, you were to buy a home that desperately needed a new kitchen, you could borrow through an FHA 203K lender and qualify for money to buy the house and renovate the kitchen, plus “contingency reserve” funds for completion if costs exceed estimates.
What a 203K Consultant Does
The 203K consultant helps home buyers coordinate the many steps involved in this type of financing. A licensed 203K consultant starts by scheduling a site visit to the property the buyer is interested in. The site visit allows the consultant to thoroughly examine the property and make an assessment about the renovation project’s feasibility under 203K requirements. If the project looks like it will be within the scope of a 203K loan, the buyer pays the consultant a retainer fee for his or her services throughout the buying and renovating phases.
Scoping Out Repairs and Renovations
After visiting the site and speaking with the home buyer about renovation plans, a 203K consultant prepares a document about the project’s specifications and scope. This report contains various architectural exhibits and a detailed breakdown of costs for each repair task necessary to complete renovations. The consultant also prepare lender and contractor bid packages that include “draw” request forms that allow money to be withdrawn according to the work plan for the renovations. A copy of the complete write-up is given to the lender, contractors, and the borrower.
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