Before Before Before The 203k Rehab Loan Picture the Potential A MARKETING PACKAGE & L OAN P ROGRAM DESIGNED TO I NCREASE SALES AND REDUCE TIME ON MARKET After After After 1 South Nevada Avenue, Colorado Springs, CO 80903 CentralBancorp.com Before Before Before
Picture the Potential is a complete finance and marketing package for distressed homes, foreclosures, bank owned, or properties that need a little TLC.
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BeforeBeforeBefore
The 203k Rehab Loan
Picture the Potential
A MARK E T I N G P A CKAG E & LOAN
P ROG RAM D E S I G N E D T O IN C R E A S E
S A L E S AND R E DU CE T IM E ON MARK E T
AfterAfterAfter
1 South Nevada Avenue, Colorado Springs, CO 80903
CentralBancorp.com
BeforeBeforeBefore
The 203k Loan Picture the Potential Marketing Package
CB Title and CB&T Mortgage combine their expertise to offer you
a rehabilitation loan and marketing package to help you turn your
listings faster.
With an investment of $100 you will receive the following:
• 100 customized listing flyers that include the benefits associ-
ated with the 203k loan. (Template enclosed)
• A link to your listing in the Real Estate Toolbox, an e-
newsletter that reaches over 900 people
• Listing on “Bringing dreams to life with the 203k” LinkedIn
page
• Listing on a 203k Loan Candidate flyer distributed to over 200
real estate professionals monthly (Template enclosed)
• Consultation with Bev and Jill to maximize selling points of
your listing Meet your Marketing Team
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Jill Webb, CB Title • 14 years of sales and marketing background • Colorado Springs native • Known for bringing ideas to life • Genuine interest in community reinvestment and
creating a beautiful place to live • Actively involved in community and housing indus-
try
Bev Creswell, CB&T Mortgage • 20 plus years of experience specializing in 203k
loans • Sole lender in Colorado Springs certified to teach
203k lending • Has completed over 200 203k loans since 1989 • One of the original lenders for the FHA 203k pilot
program
(719) 684-6547
(719) 228-1082
Renderings provided by Stauffer and Sons Construction, an approved FHA contractor www.StaufferandSonsConstruction.com CentralBancorp.com
This program brought to you by CB Title and CB&T Mortgage , affiliates of Central Bancorp
Understanding the 203k Loan
The FHA 203k Loan
With a 203k loan a buyer can borrow the funds to purchase or refinance a home and renovate it all in one loan. The 203k program serves as the primary tool of the Federal Housing Administration (FHA) for providing insured mortgages for the purchase or refi-nance of single family properties (one to 4 units) in need of major rehabilitation. This program is tailored to buyers interested in buy-ing a house that needs work, but don’t want the hassle of getting two separate loans, or for people who need extra financing to im-prove a newly purchased home.
Advantages of the FHA 203k
• FHA certified contractor must complete renovations within six months after closing with the loan
proceeds.
• Great tool for REO properties
• Low down payment and competitve
interest rates
• One loan amount for both the purchase/
refinance and the cost of repairs
• Construction loan fees may be financed
• Mortgage is FHA insured
• Maximum loan to value is based on the cost to acquire the property plus rehab or 110% of the “as improved” value,
whichever is less.
• Can be used in conjuction with the first time home buyer $8,000 tax credit if home is purchased and loan closes on
or before Novemeber 30, 2009
A 203k Loan Includes
• Mortgage amount includes:
- The cost of rehabilitation
- a minimum of $5,000 in
eligible repairs is required
- Up to 6 mortgage payments during
completion of construction
- Upfront mortgage insurance pre-
miums
- 203k consultant fee
- Cost of inspections, title updates,
and permit fees
• Money is released to contractor in
draws as work is satisfactorily com-
pleted
• Escrow is set up for the estimated cost
of materials and labor to complete the
rehabilitation, plus 10%-20% contin-
gency reserve
-Escrow for repairs earns interest,
payable to borrower
203k Eligible Improvements
• Structural repairs and alterations—
includes finishing attics/basements and
repair of structural damage
• Improvements/modernization—includes
remodeled kitchen/baths, installation of
permanent appliances such as built-in
range/oven, range hood, dishwasher,
microwave
• Elimination of health/safety hazards—
including resolution of lead based paint
• Changes for aesthetic appeal—includes
new siding, exterior doors
• Interior and exterior painting
• Installation of well and/or septic
• Recondition or replacement of heating/
air conditioning
• Replacement of roofing, guttering and
downspouts
Benefits to the 203k Loan
Listing Agent Benefits
• Increase sales and income*
• Retain good standing with your asset management com-
pany
• Potential to significantly reduce time on market and mar-
keting costs*
• Differentiate you from competitors
• Increase exposure through Central Bancorp 203k
Picture the Potential marketing program initiatives
a. Listings on social media sites
c. Newsletter links to listing information
d. Listing flyer distribution to buyer’s agents
e. Custom “picture the potential” flyers
This program brought to you by CB Title and CB&T Mortgage , affiliates of Central Bancorp
Buyer Benefits
• Obtain one loan covering mortgage and remodeling
work at a competitive interest rate
• Renovations must be completed within 6 months of
closing. If house is uninhabitable due to renovations,
you may finance up to 6 mortgage payments.
• You direct the remodel to match your taste and
lifestyle
• Take advantage homes valued under market. Potential to
build immediate equity once the renovation is complete
• For qualifying purposes FHA will consider 90% of
rental income on duplex, triplex and fourplex units.
• Can leverage first-time home buyer $8,000 tax credit if
home is purchased on or before November 30, 2009
Seller Benefits
• Potential to significantly reduce time on market for
homes that need repair
• Provide rehabilitation options for buyers to purchase the
property, especially if it’s a property that has structural
damage
Buyer’s Agent Benefits
• Increase sales and income*
• Quicker decisions by buyers
• Gives you a financial tool to help your buyers
• Differentiate you from competitors
*Marketing strategies are not guaranteed.
CB&T Mortgage 203k Finance Example
Financing Breakdown for Property with Improvements:
Purchase Price $ 150,000
Cost of Rehab 123,677
$ 273,677
Loan Amount $ 266,632
Down Payment 9,578
Closing Costs $ 4,866.99 (includes title fees)
Prepaids 2,307.88
Total $ 7,174.87
Closing costs and prepaids may be paid by
seller not to exceed 6% of purchase price.
Principal and Interest $ 1,525.76 *
Mortgage Insurance 121.05
Taxes 150.17
Insurance 83.33
Total $ 1,880.31
*Based on an interest rate of 5.50% over 30 years. APR 6.184%.
Example based on rehabilitation of a fourplex with a projected rental
income of $1,725. Based on $575/month per unit x 3 units with pur-
chaser occupying 1 unit as primary residence.
Bev Creswell I CB&T Mortgage I License #100024383 I (719) 440-1082 I [email protected]