What is the maximum number of draws on a 203k project?
By Mike Young, FHA 203k Consultant 916-758-1809 cell direct
(203kOnLine.com, covering the USA)
What is the maximum number of draws on a 203k project?I have had a major lender turn down a loan when our contractor requested 10 draws @$30,000 for a $300,000 construction amount.I set in on a Denver HOC web-cast as I thought we would get some new input or incite. Sadly they were merely reading from the 1994 manual, and mis-reading this portion as so many do. 4240.4 Rev-2 states "Intermediate draws (four maximum) [and one final draw] are inspected by the HUD assigned fee (or DE staff, where applicable) inspector (see paragraph 4-9)."It goes on to state "If the cost of rehabilitation exceeds $10,000, then additional draw inspections are authorized provided the lender and borrower agree in writing, and the number of draw inspections are shown on Form HUD 92700, 203(k) Maximum Mortgage wo...
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