If you're thinking about purchasing a house and renovating it, you'll need to hire a home inspector to check the property. And we're not the first to inform you that home improvements may swiftly go wrong. Contractors may fleece you for more money and delay or cancel the job if they aren't as good as you thought. If you're the one in charge of the project and paying for it out of your own cash, your remodeling might turn into a nightmare.
This is where an FHA 203k expert comes in handy. A 203k loan not only combines your mortgage and remodeling repairs into one loan to save out-of-pocket costs, but your 203k consultant also works as your home inspector, establishes realistic pricing, checks the work is done correctly and manages the approval of loan payments to the contractor.
In this article, we'll discuss the need for a 203k consultant and why your home purchase and renovation may be ideal for a 203k financing.
When Should You Consider Using a 203k Loan and Consultant?
If your expected home remodeling expenditures exceed $35,000, you should consider a 203k loan.
Home remodeling projects can easily exceed that amount, and if you're paying for it out of pocket, it wouldn't be uncommon for you to go way over that amount. A 203k loan is the only way to enjoy significant cost savings.
How Does a 203k Consultant Help?
Do you have a successful career but lack home improvement knowledge? An FHA 203k consultant can help you with the following:
1. Home Appraisal
Along with your home inspection, your 203k consultant will arrange a home appraisal to be performed. To get the most accurate appraisal, the work you're having done must be completed on your home so that the home appraiser may see the completed product. It's important to remember that a 203k does not require you to complete all the renovations. In fact, some 203k loans allow for 100% of the renovation costs to be paid for by the loan.
2. Suggests the Right Contractors
Your 203k consultant can connect you with the right home contractors. They will suggest contractors familiar with the 203k process and who have been approved by the FHA. It's a plus if they also have a good reputation within your community.
3. Guides You Through The Process
If you've never done a home remodeling project or if this is your first home purchase, a 203k consultant can help you work through the process. Being first-time homebuyers can make this process a lot more complicated than it actually is.
4. Your Renovation List is Divided Into “Needs” and “Wants” By 203k Specialists
When you're renovating your house, it's relatively easy to have add-ons as the job progresses. Although your consultant will have a contingency budget, they will ensure that you do not overspend depending on the loan amount.
They will divide the construction into "needs" and "wants" lists in their report. Some of the repairs are required to bring your house up to code. Others on the list may be products that you particularly desire.
Conclusion
There's no question that renovating your home is a big decision. It also requires a significant investment of time and money, and finding the right contractor can be a challenge. However, hiring a 203k consultant will help you overcome any barriers to completing your project. Even if you're not planning to purchase a home, you can still save money on home renovations by finding a great contractor.
Do you need a house inspection in Birmingham, AL? Let's Do It Home Inspection Services is a team of experts dedicated to providing quality professional home inspection services to all homeowners and Realtors. Call us to book your appointment today!