FHA 203k appraisal guidelines (resources)

by Dan , Wednesday, July 01, 2009, 02:11 @ Kathy Roberts

Kathy,

There should be a 203k FHA consultant assigned to this loan. FHA will send out a contractor who will determine what needs done. You can get a copy of his / her cost estimates and scan them directly into your report. If it is a contractor make sure there is no "deal or discount" to a friend. If so, adjust your costs. Do the appraisal subject to completion just like it is new construction. You do not do 3 appraisals. The realtor is an idiot.

Confirm this with the lender. I have done 8 of these but lost them all when my files crashed. Each time a 203k appraisal is done an approved FHA contractor or consultant was assigned to quote the job. A good way to check if the contractor knows what he is doing is take your GLA that is being rehabbed and divide it into the proposed "rehab" cost figure. Then call 2 to 4 local contractors to ask what their cost per sq. ft is to renovate. Tell them style of house and level of finish: tile floors, granite countertops, etc whatever applies.

Hope this helps and in the future take what a realtor who is receiving a commission on the deal with a big grain of salt. :-)

all the best - Dan