Chapter
1 Appraisal & Property Requirements Page
1-10 General
The
Section 203(k) program is the Department's primary program for the rehabilitation
and repair of single-family properties. The program allows the borrower to get
just one mortgage loan, at a long-term fixed or adjustable rate, to finance or
refinance both the acquisition and the rehabilitation. Please see: HUD Handbook
4240.4 rev-2 and 4150.2
Appendix B-1 for additional information. See Mortgagee
Letter 5-50 for information on the Streamline
203(k) process. (Cooperatives are not eligible for 203(k) mortgage insurance).
Also
see: HUD
Form 92700 203(k)
Maximum Mortgage Worksheet
(2/06). Appraisals
|
If
the appraiser identifies repair conditions that were not noted in the work write-up,
the appraiser should notify the lender. |
|
An
appraiser may not perform a dual role on the same 203(k) property. To prevent
apparent conflict of interest an appraiser may not be a 203(k) consultant, or
have a direct or indirect involvement on any property they appraise. |
|
The
appraisal will contain a statement on the report by the final value that the appraisal
being performed is a 203(k) as improved per plans & specifications. A copy
of the plans, specifications, work write-up and other conditions upon which the
value was based must be part of the appraisal package. |
|
In
mixed use properties, commercial space is to be appraised as if it were residential.
The lot value assigned should be for the residential use, not the commercial use. |
List
of 203(k) Consultants
203(k)
Consultants can be found on HUD's website by using the 203(k)
Consultant Search Tool. Additional
information on matters relating to consultants may be obtained from HUD
Mortgagee Letters 1995-40 and 2000-25.
|