Sam Thompson Mortgage Update: “Get Over it! Please”
I could hear the frustration in the agent’s voice when he left me the following voice message this week:
“Sam, it seems like every house that my customer is looking at in his price range needs some kind of work. One has the electrical ripped out of the attic and the other needs a foundation repair of about $6,000.”
“I need to talk to you and see how the FHA 203K loan works and what is involved,” said Hicks Malonson, an associate broker with Harry Norman Realtors in Marietta.
I know that there are those of you out there that have not been involved with a renovation loan before and may feel anxious and reluctant about getting involved with this unknown animal. What the heck’s a K-loan (as we affectionately call them), anyway?
So I am going to ask those of you who feel that way to confess, slow down for just a minute and let me give you some very important advice : GET OVER IT! Quickly! Please!
Actually I was walking through the Fernbank Science Museum
a couple of Sundays ago and noticed all of the animals that are not with us any more. A pitty, don’t you think? Too bad there was no one around to advise them to change their habits before it was too late. Or perhaps Charles Darwin was right. Perhaps they evolved and adapted to the changing environment over time.
In the same manner of thinking, how much longer will you survive in the current challenging real estate market we find ourselves in if you refuse to use some of the tools you need to succeed?
Nia Knowles with Solid Source Realty is a renovation expert in marketing her community in the West End of Atlanta. She knows that renovation lending is a little more complex than the average mortgage loan transaction and may take a little more time, but that it is really the only way to get the job done. Unless your buyer is paying cash.
Melissa Krudwig of Keller Williams in Marietta is participating in her first 203K loan transaction with a client that is a first-time homebuyer. “I believe that the FHA 203K program is very important and is very critical in today’s market,” says Krudwig, who markets herself to her customers as the Bear of Real Estate.
“The Atlanta Real Estate inventory is flooded with incomplete and vandalized homes that will simply never pass the appraisal requirements for a traditional FHA Loan,” explains the Bear. “Most of these properties are great properties at the bones of the homes but they need some additional help such as replacing a stolen HVAC system. If it was not for this program, my buyers would not have the dream home that they so desired.”
Nationally, Wells Fargo, my lending partner, controls about 40 per cent of the FHA 203K renovation lending market. The loan process itself takes a little longer, about 45 days.
So if you would like to learn to be a bear instead of a dinasour when it comes to selling properties that need a little work, please give me a call. For he or she that hesistates may become extinct. If you think your office would like training in renovation lending, please ask your broker give me a call.
Until next week.
Best regards, Sam Thompson
Loan Officer and columnist