Mike Young

The 203k has been around since 1961 and during the past week I have heard from 20 people or more that just found out about the 203k... wow. They were very excited about it and thought it would be a big help to their business. The funny thing is that they are right. This has always been right and there are always people who just find it and think it is a great product. I think of the 203k as "HUD's best kept secret" yet they are constantly tellling people about the program. If you aren't familiar with it then get familiar with it. This program can actually save some of your deals. While it isn't a "cure all" for every deal it IS another tool that you should have in your tool box. I really enjoy asking real estate agents and brokers if they ever get a client come into their office to purchase a home. They ask the first question... "How much money do you have to put down?" and when they respond with something like "Well I heard about these no money down deals do I really need money down/." That becomes the last question as well and the agent kicks them in the butt on the way out the door. When I ask a group this question I usually get a lot of laughter then ask them this "please, in the future send those clients with no money down to the newest agent in your office... then that agent should bring those "clients" to me. I'll turn them into a purchase." The room ususlly gets quiet about that time and all those laughing people who were kicking those "no down payment clients" out the door now want to know more. Gee whiz. I can sell a house to any borrower... why can't YOU? Actually YOU can too. That is what our FREE seminars do for you. We are setting up a set of seminars in Durham NC and invite you all to see what goes on. While they are FREE we do require that you have a ticket so please go to my website and order your tickets... yes I said tickets with an s... I don't want you to take up a seat that could have been a deal so you must get more than one ticket and bring someone with you... bring a property that needs rehab, a borrower with NO DOWN PAYMENT, or an INVESTOR. Wow, 203k and investor used in the same paragraph. Yes that is correct and "don't worry about it", it works and works well. We will sell properties to your Investors, you get a commission. We will hook you up with a buyer if you have a property... do you care if that buyer is an investor or a home owner? No, you don't. Your commission is the same in any case. The way we do it you may get two commissions on each house. How about that? if you don't do anything else this year you should see one of these seminars... you may never sell homes another way again. Borrowers are welcome... why would you want to come? Easy, you can purchase a fixer and get the money to fix it as well. You can buy an investment property that is beyond your expectation. You can get a home with very little down or no money down if you must. FSBO - we will provide a buyer for your property... what will it cost you? about 2.5-3% but only if we sell it or provide a buyer the night of our seminar... wow. You show up and go home with a buyer the same day or the next day. By the way, did I tell you we will get your full asking price?

We just had a meeting with HUD and they would like to see more EEM (energy efficient mortgaqe) combined with the 203k. This has been a great help in the past where the rations were tight and in one case it was near Christmas and just before closing the borrowers charged up their credit cards with presents... this was about to kill the loan when we suggested the EEM and ended up closing the loan. A HERS report will be required.

The great thing about a HERS report is that the rater will then let you know what are the most effective items to rehab to get the maximum benefit of your rehab to save monthly payments. The raters in the room were quick to remind us that dual pane windows are NOT the first choice most of the time. They may make the home look more modern but seldom are the most effective way to spend your rehab dollars if you are trying to use less resources.

You can actually close a loan for more than the "Maximum Mortgage Limit" by utilizing the EEM. You can take out the EEM items and then qualify the borrower, then put the items back into the loan and close it. There was a cap of $8,000 until earlier this year when it was increased to a percentage of the loan amount which increases it potential dramatically in some areas.

Sorry I have been slow to get back to you with a new blog post. I've been writing for a couple national companies for some "all new" training programs and seminars. Watch for them as we have tried to be innovative in our approach to some older information while providing a lot of new information for you. I'm excited about what we have come up with and will be letting you know more as we release the information.

We have some meetings coming up shortly with HUD and I'll attempt to find out more about the rumors that I have been hearing about the "investor 203k" program going back into use. If that would happen you would really see some properties sold.