AboutJim Root Expertise How to select the right Real Estate Salesperson & Loan Officer--ones who will serve your best interests! House-hunting tips & suggestions on selection of the home best for your family needs. Introduction to the Home Buying Process & all the "Players" involved.What is of utmost important to the Homebuyer? Real Estate Contracts & Negotiations, Appraisal needs, Title Co. involvement, Home Inspection issues& the Closing/Escrow systems, etc. Whatever your question, the answer will follow, whether from personal knowledge or research! Gale, shown here with me, has been a Real Estate Office Administrator, licensed Realtor & has served as my Research Assistant over the years!
Experience Over 30 years as a "Real Estate Professional." including Real Estate Marketing & Sales, Appraisal work, Mortgage Banking & as a Realty Officer with U.S Dept. of HUD's FHA Homeownership Division in Alaska, Washington & Idaho! Some experience in Montana, California, Utah & Nevada markets!Knowledge of National Markets by continuous Research!
Organizations Former member of Nat'l Ass'n of Realtors (NAR) & Mortgage Bankers Ass'n of America (MBAA). Currently with National Association of Review Appraisers & Mortgage Underwriters (NARA/MU).
Publications Published in various local, state, regional & national Real Estate-related magazines & newsletters!Co-author of various Govt. publications on Homeownership, Appraisals & Mortgages while with HUD/FHA.
Education/Credentials Associate Degree in Real Estate Studies plus:
Numerous Real Estate-related Courses conducted by the U. S. Government & Private Industry over the past 30 years.
Bachelors Degree in Mass Communications,
Masters Degree in Education/Teaching
Awards and Honors Professional Designations: Certified Residential Originator (CRO) from MBAA, Registered Mortgage Underwiter (RMU) & Certified Review Appraiser (CRA) from NARA/MU. Outstanding Peformance Awards for 10 of the 12 years with HUD/FHA & numerous Sales/Listing Awards while a licensed Real Estate Agent.
Past/Present Clients No longer selling/listing Real Estate, nor Appraising properties, nor working in the Mortgage business, this "Real Estate Pro" serves as Director of a Company that provides Professional Development Seminars & Workshops to the "Real Estate Industry" and provides free (as needed) & fee-paid (on a sliding scale) consulting & inspection services to members of the general public.Your questions will be answered without "salesmanship" & with your best interests in mind!
Expert: Jim Root Date: 7/4/2008 Subject: fha 203K loan for mobile home on private property
Question My son is a YOUNG first time home buyer - prequalified through fha for 203K - made an offer on a double wide mobile home (no foundation) on property - well water & septic - his agent is telling him he is NOT required to haven an inpsection - fha inspects well, s eptic, etc. but this is a foreclosure - what happens if something is seriously wrong - is there any way out?? Would it be beneficial to get an inspection?? Does that give him anytime to know if there is an EXTRAORDIANRY COSTLY problem that he wouldn't loose his hand money?? or are these AS IS - I understand he can use the 5,000 to make repairs; but I am concerned with knowing what if any problems there are. can you help? We are all unexperienced at this, and therefore at a loss to help advise him
Answer BARB--
Your question(s) make me wonder about BOTH your Son's Loan Officer AND his Realtor!It sounds like neither of these folks know enough about the 203K Loan process to earn their commission(s)!
Both the "Standard" 203K and the "Streamlined" version of the "K-Loan" REQUIRE a formal INITIAL INSPECTION --the "Standard" K-Loan process BEGINS with a detailed inspection by a HUD-Approved Rehab Loan Consultant who determines what MUST be done to the property to make it meet FHA's Minimum Property Standards (MPS). The Consultant then assists the Buyer with developing a "Rehabilitation Project" that fits within the Buyers Loan Qualification range AND satisfies all MPS requirements.Consultants are qualified Home Inspectors and will determine if wells, septics, and features & utilities are functional as a part of the initial Inspection. Anything that needs fixing is then included in the "Rehab Project" that is funded within the Loan! When the "project" is completed a FINAL INSPECTION is done to ensure that "all's well!"
If the "Streamlined" 203K is used, no Consultant is needed or allowed, but a Home Inspection done by a qualified Inspector AND the FHA Appraiser's Inspection of the property is REQUIRED to develop the "Rehab Project!" The "Streamlined" version of the K-Loan CAN'T be used if/when the work that needs to be done is STRUCTURAL--as opposed to strictly "cosmetic"--so for a Manufactured Home needing FOUNDATION work the "Standard" 203K would be used!
You mentioned "$5000" and that the home was a "Foreclosure!" If this is a HUD-Owned Home, besides a 203K (which is NOT limited to $5000 of repairs), they also sometime offer their Homes for sale "As Is, with a Repair Escrow!" This isn't a K-Loan, but it allows for an "As Is Purchase," HUD's "disclosure" of (some) deficiencies and authorization for the Buyer to add up to $5000 to the Loan Amount so as to "fix" the declared deficiency AFTER closing!
A Loan Officer experienced in doing 203K Loans and/or loans in support of the purchase of HUD-Owned Foreclosed Properties should KNOW and have COMMUNICATED these facts to their Client--your Son. The Realtor who's handling the purchase/sale for the young man also should be knowledgeable and should ensure that your Son's best interests are upheld!
The 203Ks, "As Is, with Repair Escrow" and dealing with HUD on the purchase of one of their Foreclosed Properties are EACH very COMPLICATED,extremely FRUSTRATING & DIFFICULT actions. You put them all together in one transaction & there'd better be a knowledgeable, experienced and skillful Real Estate Agent AND Mortgage Loan Specialist keeping things "on track"
I suggest that YOU go to the HUD/FHA Website (www.hud.gov OR www.fha.gov) and find "HUD Homes for Sale" AND "The 203K Loan Program." Both have spots on the Website that will fully inform you of the details of these kinds of transactions--then you'll be able to help your Son make good decisions. (And don't hesitate to talk, directly to the Loan Officer and Realtor about this matter. Your Son will have to "OK" their discussing his Purchase/Loan with them first, of course)
I hope that my response to you is helpful. GOOD LUCK!
--JIM
P.S. A Foreclosed-upon Mobile Home would NOT be where I put my Mortage Money right now. Of all "Residential Properties," previously-owned Manufactured Housing Units are NOT the "best investment" even in a STRONG Real Estate Market. And right now--in the "weak" Realty Marketplace-- there are numerous "Real Deals" on Single Famiy "Stick-Built" Homes!I'D BE ADVISING MY SON TO LOOK FOR A BARGAIN-PRICED HOUSE--NOT A MOBLE HOME! Not only will he be "more comfortable" in a "Stick-built" Home, b ut iot will build more equity as the market returns to normal! (jr)
