FHA 203K Streamline - Louisville Housing Option

FHA 203K Streamline Program(KY Housing Option)

1Louisville, KY Neighborhoods: Anchorage, Audubon Park, Middletown, Highlands, St. Matthews, Crescent Hill, Hikes Point, & JeffersontownContact Mitch Thomas, Realtor®, Keller Williams Louisville to learn more about 203K loans! Go to http://kwlouisville.com or call/text 502.345.5754

FHA 203k Streamline (Overview)

• Assists homeowners with basic repairs • Finance acquisition of property and cost of repair/rehab/update • Cannot borrow < $5,000 or > $35,000 including reserve, etc.

•Repairs for correction of lead based paint can exceed the $35K limit if subject property is a HUD REO

• Must begin within 30 days & be completed within 6 months• Property must be existing • Owner-occupied, one to four unit properties permitted• No improvements to detached structures or luxury items

• Property must appraise to cover Price + repairs/uodates

• May finance 96.5% of Price + 100% of repairs/updates, up to 110% of “As Completed” Value • May finance inspection, title update & required permit(s)


FHA 203k Streamline Eligible Work Items

• Repair/Replacement of roofs, gutters and downspouts • Repair/Replacement of HVAC, plumbing and/or electrical

• Repair/Replacement of existing flooring

• Minor remodeling not involving structural work

• Exterior and interior painting • Weatherization: storm windows & doors, insulation, etc.

• Appliances not exceeding $2,000 total cost

• Access improvements for persons with disabilities

• Repair/Replacement/Addition of decks, patios, porches • Basement finishing/remodeling not structural in nature

• Basement waterproofing

• Replacement of windows, doors or exterior siding


FHA 203k Streamline Ineligible Work Items

• Any work involving relocation of a load-bearing wall • Any work requiring detailed or architectural drawings

• New construction (including room additions) • Landscaping or similar site amenity improvements


FHA 203k Streamline Contractors

• Use of a General Contractor is not required • Must use the services of one or more contractors*

• Borrower will select the contractor or contractors • Contractor(s) provide estimates for work to be done

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FHA 203k Streamline Cost Estimates

• Provide a written cost estimate(s) from a licensed and bonded contractor for each repair or improvement • Only "fixed price" contracts are acceptable, not “cost plus”

• Must clearly state the nature and type of repair and the cost for completion • Estimate(s) must identify any subcontractors to be used

Louisville, KY Neighborhoods: Anchorage, Audubon Park, Middletown, Highlands, St. Matthews, Crescent Hill, Hikes Point, & JeffersontownContact Mitch Thomas, Realtor®, Keller Williams Louisville to learn more about 203K loans! Go to http://kwlouisville.com or call/text 502.345.5754

Cost Estimates & Contractor(s)

• Estimates must state if permits are required and if included

• Each accepted Bid must be signed by Contractor(s) & Borrower(s)

• Homeowner/Contractor Agreement must be signed by each Contractor & Borrower(s)

• Lender must review contractors’ credentials, experience and client references and may require additional estimates

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Contractor / Sub-Contractor Documentation

• Contractor Profile Report completed by each Contractor

• Copy of each Contractor’s License (if required by state)

• Copy of each Contractor’s Liability Insurance coverage • Copy of each Contractor’s business card

• Completed W-9 from each Contractor

Louisville, KY Neighborhoods: Anchorage, Audubon Park, Middletown, Highlands, St. Matthews, Crescent Hill, Hikes Point, & JeffersontownContact Mitch Thomas, Realtor®, Keller Williams Louisville to learn more about 203K loans! Go to http://kwlouisville.com or call/text 502.345.5754

FHA 203k Streamline Self-Help

• Only IF the borrower can sufficiently demonstrate that he or she has the necessary expertise and experience to competently perform the work (i.e. is an electrician and will perform electrical repairs/upgrades to the property)

• If "self-help" arrangements are utilized, the borrower must provide written estimates from the suppliers of the materials that the borrower will purchase


FHA 203k Streamline Disbursements

• Two-party checks to Borrower(s) AND each Contractor(s)

• The first payment of 50% of Costs is AT Closing

• The balance of costs will be released upon completion of all work, inspection by Appraiser and Title Update

• Inspection is coordinated between Investor and Borrower

• Any excess funds will be applied to Principal balance of loan

FHA 203K Streamline - Louisville Housing Option

Real Estate

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