203k Consultant –  Orange County, Los Angeles, Inland Empire

What is a feasibility analysis and when should it be used?

Click here to request your 203k feasibility analysis report

For The Buyer – As a buyer, the feasibility analysis has a specific use… it is used to determine quickly what it will cost to renovate the 1-4 unit property to the FHA Minimum Property Standards (MPS) if you are trying to determine an offer amount. For a fee of  $250.00, our HUD 203k Consultant will inspect the property and produce a Feasibility Study Report. This report can be used as a tool to when making your offer to know exactly what repairs will be required.  The seller typically is not be required to pay for upgrades you might want, just the MPS. Your offer might be the asking price less the cost of the repairs in some cases. If the home isn’t for sale and you are trying to purchase it this tool will help you determine the amount to offer. You can also take the feasibility report and shop it around to various contractors. This way, each contractor is bidding on the same work. It is called an “apples to apples” comparison. If you would like, we will review the contractors estimates at no additional charge, to make sure they have covered everything.

You should then talk to your realtor to determine the average price of the neighborhood, or you can do a Zestimate by Zillow to determine the typical value in the neighborhood for a home of similar size and location. Minus the cost of the repairs to arrive at your offer price.

For The Seller – On the other hand, maybe you are the seller and you want to maximize the amount of money you can sell the property for… you could order a feasibility analysis and suggest upgrades that will maximize the appraised value. Then you back into a sales price by taking the “after improved” value less the cost to make all the repairs to arrive at a potential sales price while knowing your 203k buyer can go to 110% of the “after improved” appraised value. The 203k feasibility report can be a “value added’ sales tool for you.

For The Realtor – As a Realtor moving forward into the exciting and prosperous specialty field of rehab financing, you should consider 203k Feasibility Inspections. Being a selling agent for distressed properties, we recommend that you consider ordering a Feasibility Inspection for all your listings needing repairs or up-grades. For a fee of  $250.00, our HUD 203k Consultant will inspect the property and produce a Feasibility Study Report. This report can be used as a sales tool to show prospective purchasers exactly what repairs will be required to purchase this home and what the projected repairs will cost.
REO agents around the country have had huge success using this format to sell distressed properties. Using a Feasibility Report, in many cases can replaces the need for a Home Inspection and it is priced at much less. It is also may be financeable into the 203k loan (check with the lender). Our Feasibility Inspection Reports give you exactly what you need—what has to be repaired and how much will it cost.
Once you have a buyer interested in the property, the 203k Consultant can return to the home and complete the full 203k Work Write Up. Taking into consideration what additional repairs or up grades the buyer desires.

“Why not just call a contractor for a free estimate?”

Have you ever heard the saying, “you get what you pay for”? A free estimate is usually just that. Remember, a contractor is trying to earn your business. He will usually offer a low price so he won’t scare you away with the reality of the cost. This is called a “lowball” estimate. To make up the difference, he will then mark up the cost of the project along the way with change orders.

If the contractor doesn’t give you a low estimate, it will usually be too high. The contractor may be busy, or its too far for him to drive, or he just doesn’t like your project. He will shoot you a high estimate to scare you away so he doesn’t have to do your job. That way, in the event you do hire him, the job will be extremely profitable to make it worth his while.

Armed with your feasibility report, you will already know how much the job MIGHT cost. That way, if the contractor’s estimate is really high, or really low, you will know that something is wrong or that he has not done a very thorough job on his estimate. If you have questions about the contractors estimates, we will review them with you at  no additional charge.

Click here to request your 203k feasibility analysis report

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