Tuesday, March 17, 2015

How Do I Choose a Consultant for My 203k Project?



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Believe it or not, it astounds me to see the criteria people use to make that choice.

#1. The lender is responsible for choosing the consultant. Even though we work for the borrower it is the lender's responsibility to choose the consultant.

#2. Quite often the lender will provide a list of 2-3 consultants that they have approved so the borrower has a choice.

#3. In many cases a borrower will find a consultant on line and request they be chosen by the lender. This is more than likely how you will find your consultant in reality

#4. What questions you might ask of a prospective consultant.
    A. How long have you been consulting?
    B. How many projects have you completed?
    C. Can I see a sample of a finished report so I can see what I'm going to be receiving?
   D. Do you have the capacity to get my consultation and paperwork to me in a reasonable length of time?
  E. What is a typical turn around for a $XX,XXX project? Realize the larger the project is, the longer it might take to prepare the bid specifications. We typically tell the client 4-5 days from the time of the inspection for most projects.

It is important to know what you are going to get for your money as all consultants don't provide the same level of service. Some do the bare minimum to get by, while there are others like us that provide the entire package ready to submit to underwriting.

You may also get a "bait and switch" operator, beware of those who quote you a fee only for you to find out later that fee was a "show up fee" and then they charge the entire consultation fee later and bill it to escrow so you are less apt to find it.

In any case whatever you pay the consultant up to the HUD guideline amounts is reimbursable in the loan and counts as money you put in the transaction.