Fifteen years ago I built a house in Gilmanton, NH. We were young and had a limited budget, so we decided to be the general contractors and often the construction workers as well. We cleared the land, mapped out the foundation, hired all of the contractors, filled out all of the paperwork and the list goes on. We used word of mouth and our own limited vetting skills to hire contractors, plumbers, electricians, and carpenters. I am sad to report that more than one of the “professionals” that we hired did not complete their work, didn’t show up on the days they were scheduled and requested payments that far exceeded their initial bids. Our lack of experience and knowledge cost us lots of time and money! In hindsight, I would definitely hire a general contractor, I wish I had, had someone to guide me through the complex process.
Although, embarking on a 203k loan process is not exactly the same as my experience I think the lesson I learned can be applied nonetheless. A 203k consultant is an expert in the process of 203k loans and renovation requirements. They are trained and certified professionals who will help you work through all of the possible kinks in the process and protect you from all the downfalls that I experienced during my construction nightmare! With the help of a good 203k consultant your rehab project will be a sweet dream!
What Qualification Must Be Met to Become a 203k Consultant?
- Must be a remodeling contractor, general contractor, home inspector, architect or engineer
- Must have at least 3 years of documented experience in their field
- Must be licensed in the state in which they are planning to consult
- Must provide proof that they understand home inspections, architectural drawings, cost estimation methods and draw inspections
- Must understand all of the requirements listed in the 203k handbook
As you can see it takes quite a bit of work and experience to become a 203k consultant. This experience and expertise will serve to benefit you as the homeowner while going through the 203k rehab process. So, you might be wondering what exactly will the 203k consultant do for me?
Here is a breakdown of the services that your 203k consultant will provide for you:
- inspect the property and decide what repairs need to be made to meet HUD minimum standards
- meet with you to discuss what repairs need to be made and any additional renovations/improvements you plan to make to the property
- prepare all the necessary paperwork that the bank/lender will use to determine the loan amount
- prepare any additional paperwork that may be requested by the lender during the loan process
- inspects repairs as they are being made (after the loan closes)
- acts as an intermediary between you and the lender
- tells the bank when repairs meet inspection standards and the payments can be released to contractors
- provides you with expert advice and acts an advocate with years of experience in the business of rehab and renovation of properties
What Should You Consider When Hiring a 203k Consultant?
You can see that working with an experienced, trustworthy and knowledgeable 203k consultant can be very beneficial to you. Making the right choice when hiring a consultant can save you countless hours of frustration, thousands of dollars and many hours of work. Where you are required to have a 203k consultant when going through the Rehab Loan process, you do have a choice of many different consultants with whom you can work. You must be discerning in your choice and make sure that the professional you select has the qualities that are most important to you. You should consider their years of experience, area of expertise, location that they serve and reputation. You might be wondering about the cost of hiring a 203k consultant. Generally, consultants follow the HUD guidelines and cost is based on the amount of money that you are borrowing to renovate your home. Additionally, these fees can usually be rolled into your loan.
Let Us Be the Consultant in Your Corner!
As you can see selecting a quality 203k consultant with years of valuable experience can provide you with the support and peace of mind that you will need while completing the 203k loan process. At Advanced Home Inspections our certified, reliable, experienced and trustworthy consultants can help you through every step of the process, making renovating your dream home, not only a reality, but a real dream!