203 k Streamline lender? (loan, interest rate, approved, requirements)

[shammy79]

Hi all-
After lots of independent research on mortgages, we've decided that a FHA 203(k) Streamline may be a very good option for us. I've learned that anyone who can process a 203(b) can do a 203(k) Streamline (not the long one). The problem is, we can't find lenders for our area that are familiar with this or will do one.

Can anyone recommend a lender who will do 203(k) STREAMLINE for the Nashville, TN area?

Also, has anyone gone through this? Can you comment on your experience?

Thanks!

[Daddys///M3]

I don't know if they have retail channels for it, but Taylor, Bean & Whitaker have a solid 203(k) program from what I hear, although I have no firsthand experience.

[renriq02]

It would probably be done the same way as a 203b streamline.

I'm doing one now, and I bet it's the same way.

Not ALL lenders do 203k loans. There are only a handful that do so.

I haven't done one in a while, but it was complicated at first, and this maybe the reason why nobody does it.

Originally Posted by shammy79

Hi all-
After lots of independent research on mortgages, we've decided that a FHA 203(k) Streamline may be a very good option for us. I've learned that anyone who can process a 203(b) can do a 203(k) Streamline (not the long one). The problem is, we can't find lenders for our area that are familiar with this or will do one.

Can anyone recommend a lender who will do 203(k) STREAMLINE for the Nashville, TN area?

Also, has anyone gone through this? Can you comment on your experience?

Thanks!

[rcarrillo]

Not every lender that does a 203b will do a 203k. They CAN do them, but that doesn't mean they will.

Many lenders won't because ~30% of 203k loans (from what I was told by HUD) end up in some form of litigation. Almost always between the buyer and the people doing the repairs. Either they went over budget, weren't done properly or not to the satisfaction of the home owner. Unfortunately the lender gets dragged into the situation in many cases so lenders have cut back or stopped doing the program. Taylor, Bean & Whitaker does do the program... but they only wholesale it through brokers, they do not offer retail.

I have done some in NC and FL, but not licensed in TN. They aren't so bad as long as the person that does the loan and the contractor are experienced with the program. If you want you can PM me and I can provide referrals in the state that I know can do them.

[SmartMoney]

Originally Posted by mayoung

I hope the 30% in litigation is not a reality for you. I've done over 2,500 of them and only two went to court, both of them were thrown out. See if you can find a 'Metro Cities Mortgage' in your area. They are pushing the streamline 203k. You can also go to the HUD website and search lenders under the 203k. Here is the link that came up. Just paste in a brower window and start calling them. Lender List Search Results - HUD

these lenders have made 203k loans during the past year in Tennessee.

No offense, I worked for Metrocities Mortgage and trying to close any loan was beyond difficult. I will give them this, they can draw flow charts and organizational charts like no one else, but putting it into action was a failure. It got to the point we could not change a loan amount within 5 days of closing - the system just could not handle changes in time. Hello????? Now, with the market at a snail's pace, it may be better, and in all fairness, the west coast had a great reputation. I was on the east coast.

I think another reason why so many don't take on the 203k loans is due to improper processing and closing, missing disclosures or lack of required inspections. Once HUD sends back a loan, it gets real expensive flexing muscle and trying to get everyone to cooperate. It doesn't matter if you signed a statement you would assist with post-closing requirements (also called error and omission statement), or the closing attorney has an insured closing letter (title company says they are good guys and will comply w/ all lender requests). A loan not insured or delivered to an investor on time costs money and the idea is to make money. Once a few lenders start paying, they realize this is not the program for them.

I would like to ask the OP what kind of loan is this,the interest rate, and what is the current loan balance? I apologize if it's a "duh" question, but sometimes a little clarity can save a lot of time.

[shammy79]

Smartmoney-

The Streamline 203k is the "short" version of FHA's 203k program. In a nutshell, FHA allows you to finance the cost of repairs into your mortgage. The original 203k can be quite extensive and allows for structural remodeling. The streamline 203k has a limit of $35k in repairs and does not allow for any architectural changes (anything requiring blueprints). Streamline is structured to have two payouts 50/50.

Any lender who can process a 203b can process a 203k Streamline, however only specific approved lenders can process a 203k.

In terms of interest rate? Not sure. I have quotes for a 203b FHA, but would like to know if lenders inflate the rate for a Streamline k?

FYI- The property is located in a historic neighborhood and my husband is in the construction industry (added benefit!)

This is an extremely condensed version of FHA 203K-Here is HUD's official site:
203K Rehab Loan Insurance - HUD

ALSO- these programs will allow you to add on an EEM if need be, not included in the $35k.