Central Coast recommended FHA lenders

[Bryce Shortall]

Greetings BP members,

I've been conducting some research for a FHA (203k if possible) live-in flip opportunity in the Central Coast. My area of focus has mainly been the Five Cities region and Los Osos/Morro Bay. I'm aware the 203k process is long and arduous to meet all the requirements and jump through all the hoops but I'm making it my goal to really try and find a way to get pre approved in the near future so that I can ramp up my call lists and and start talking to sellers/agents. With that being said I was curious if there were any lenders, specifically rehearsed in FHA, that local investors have used before and would recommend. Also would be interested to hear if anyone had success with any none local FHA lenders as well here in the area. I've called up some of the big staples (BOA, Wells Fargo, some local credit unions) but keep running into a logjam of conflicting information. Thanks in advance for any and all help!

[Paul Welden]

@Bryce Shortall

I think the 203k is amazing when used properly, but because there are many moving parts to it, 1 mishap can cause a snowball effect of problems.

That's why it's very important to work with the most experienced people with the 203k. 

In a competitive real estate market that favors the sellers, getting an FHA loan offer accepted can be a bit more challenging, but 481 people closed on deals using a 203k loan last month and 2,876 FHA 203k loans have been closed since October 1, 2020.

So, they are still be done every day. Don't be discouraged and keep going. You can do it!

HUD has 2 databases of lenders where you can filter the ones with the most 203k experience and none of them are the major banks you listed.

The lender is very important because they guide the 203k to a successfully closing by knowing all the rules, guidelines and processes. The lender also selects the 203k Consultant for you who does the FHA inspection and provides a work write-up with a description of the project and a cost estimate.

Then you can give that report to a contractor who will submit a proposal based on that report and cost estimate. It will be best to use a contractor with strong financials and either 203k experience or 203k education such as a Certified 203k Contractor. 

You're only as strong as your weakest link ... select your partners wisely. 

Hope this helps.