Portland Home Renovation Mortgage Services

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HUD 203k Renovation Mortgage

The HUD 203k Renovation Mortgage Program is a government-backed initiative administered by the U.S. Department of Housing and Urban Development (HUD). It enables homeowners and homebuyers to secure loans that cover the purchase or refinance of a property, as well as the costs of significant renovations or repairs. The program offers two options: the Standard 203k for major structural improvements, and the Limited 203k for cosmetic upgrades or minor repairs. By incorporating the renovation expenses into the mortgage, the program provides a convenient and accessible way for individuals to invest in distressed properties and revitalize communities

The Homestyle, conventional renovation mortgage program and the HUD 203k renovation mortgage program are both loan options for financing property renovations. However, there are key differences between them. The Homestyle program is a conventional loan offered by Fannie Mae, while the HUD 203k program is backed by the U.S. Department of Housing and Urban Development. The Homestyle program is essentially the same as the 203K except that it allows the borrower to later eliminate PMI insurance fees without refinancing and incurring those costs. the Homestyle program typically requires a slightly higher credit score and a 5% down payment compared to the HUD 203k program at 3.5%.

The consultant plays a crucial role in a renovation mortgage by providing expert guidance and oversight throughout the project. They are responsible for assessing the property, developing a detailed scope of work, and estimating the costs involved. The consultant ensures that the renovation plans meet the lender’s requirements and comply with applicable codes and regulations. They also monitor the progress of the project, review contractor bids, and approve disbursements from the renovation funds. Their expertise helps to ensure that the renovations are completed successfully, on time, and within budget, providing confidence to the lender and the borrower throughout the process.

Scott Harris stands as an unparalleled choice for a renovation mortgage consultant in the Pacific Northwest. His wealth of experience, certified qualifications in both Oregon and Washington, and impressive track record of over 400 successfully completed projects underline his expertise. His deep understanding of the unique regional market conditions, local regulations, and the specific nuances of renovation mortgages sets him apart. Furthermore, Scott has demonstrated a consistent ability to keep projects on track, ensuring that timelines are adhered to and budgets are met. His meticulously designed methods for project documentation streamline the process, paving the way for efficient closings. His unwavering commitment to client satisfaction, clear communication, and a comprehensive understanding of the mortgage landscape make Scott an ideal partner. He embodies a blend of knowledge, experience, and dedication that translates into successful renovation mortgage projects. Scott Harris is, without a doubt, the best choice for a renovation mortgage consultant in the Pacific Northwest.

“A renovation mortgage offers a unique opportunity to acquire and transform distressed properties into dream homes. This financial tool expands buying options, enabling realtors and buyers to invest in otherwise non-financeable homes. It’s a win-win: buyers customize to their taste, while also contributing to neighborhood revitalization and boosting property values. Thus, a renovation mortgage is an innovative pathway to homeownership and community improvement.”

Common Steps for a Renovation Mortgage

  • Hire Home Inspector/consultant to do initial home inspection of property to state home inspection standards and Renovation Mortgage Guidelines. Note; Nothing happens in this process until the consultant sees the property. This can also include a Feasibility Study but this may or may not be necessary. Borrower pays consultant for inspection when it takes place.
  • Consultant works with licensed General contractor of borrower’s choice to define Scope of work. This has to include all required repairs identified in the initial inspection, anything approved that the borrower wants. This will require very specific detail and materials choices.
  • Consultant prepares a Work Write Up. This is several documents that describe the complete scope of work and costs. This has to be agreed upon and signed by the borrower, General Contractor and the Consultant. In the course of this preparation, the consultant will compare estimated costs to national and reginal standards to insure a budget conscious and value added renovation.
  • Consultant will deliver Work Write Up documents to the bank. Borrower pays the independent consultant fee (based upon the cost of renovation, a sliding scale that is roughly 1% of the renovation cost).
  • The bank orders an appraisal on the improved/renovated future state of the property based upon the Consultant’s Specification of Repairs.
  • The contractor has 30 days from closing to start and a total of 6 months to complete the renovation.
  • Consultant performs draw inspections as work progresses to inspect the work and release funds to the Contractor from the bank renovation escrow account. Borrower has control because they have to agree to draw payouts as well.
  • Upon completion of renovation, final inspection consultant processes renovation closing documents and contractor is paid off. Until final, the contractor has a “vested” financial interest in the project to keep it on track.