I just closed on a house Tuesday and have the same 203k loan - I wasn't even told how it works and that I have to wait until Bank of America

Asked by Nicol, 12589 Thu Oct 15, 2009

gets my file open. Can anyone help me just by letting me know how the draws work etc? Thanks!

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Michael Adams, Agent, Belle Mead, NJ
Thu Oct 15, 2009
Hello Nicol,
Here is a list of FAQ regarding the 203K program. http://www.hud.gov/offices/hsg/sfh/203k/faqs203k.cfm

You can find more info at: http://www.hud.gov/offices/hsg/sfh/203k/203kmenu.cfm

I hope this helps and best of luck to you.
1 vote
Deborah Cama…, Agent, Riverdale, NY
Tue Nov 24, 2009
Dear Nicol,

The most important thing you need to understand about the draws it that THEY TAKE TIME...realistically about 4-6 weeks. You must plan ahead for this and try not to split the draws into small increments. It is a great deal of work for everyone involved and the last thing you want is the pressure of a contractor waiting for a small amount of money and holding up the work. We always advise to break it up into large enough increments to keep the job moving, but of course this depends on the scope of the work which is different on every loan. Good luck, I hope your home turns out to be all that you hope for.

Best Regards,

Deborah Camacho
Mid-Island Mortgage Corp.
0 votes
Vicky Chrisn…, Agent, Purcellvile, VA
Thu Oct 15, 2009
Nicol - maybe you will find some information helpful in this post. FYI the client in this did JUST get her final draw. She and her mother are happy, because her mom was putting the expenses on her credit card, and letting her pay it off as she got draws from the bank.
0 votes
, ,
Thu Oct 15, 2009
One other thing, Nicol, you might take the time now to read back over the 203k disclosures you would have been required to sign to get the loan....They explain the entire process in detail...The most helpful disclosures would be the 203(K)Borrower's Acknowledgment and the Important Summary Notice....If you need copies of those please send me your email address and I will forward them to you...

0 votes
, ,
Thu Oct 15, 2009
Nicol....Your loan officer is the best source for information.....Depending on the amount of renovations, there might not even be any draws. If it is a small renovation amount of $15,000 or so, once the loan is set up in the draw dept., your contractor can request a material advance of 35-50%. After that, the lender would just conduct a final inspection to verifty that the proposed renovationis are complete.....

The big question is how long it will take the lender to get your information set up in the draw dept. after closing.....I hope that helps....Good luck!
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