203(K), CONTINUED FROM PAGE 4
Facilitating homeownership through the 203(k) program, they say, is one way of boosting depressed home values and revitalizing blighted neighborhoods. “It’s a great opportunity to bring the property value to what it should be, and the neighborhood back to what it should be,” said Christine Sherrod, a Realtor with Weichert who is based in Silver Spring. While Montgomery County has fewer foreclosures compared with neighboring Prince George’s, housing markets in areas such as Germantown, Wheaton and Aspen Hill have yet to stabilize, she said. Since 2009, the FHA has insured 647,774 203(k) purchase and refinance loans, according to Lemar C.Wooley, a Department of Housing and Urban Development (HUD), spokesman. Each year has seen a steady increase in the number of 203(k) loans insured compared with the standard FHA loan—also known as the 203(b)—whose applications have been decreasing. In some cases, agents are encouraging clients to shop for bargains and finance their dream homes with a 203(k) loan. Aaron Prather, a Realtor with Re/Max 2000 in Silver Spring, spoke of a client who wanted to buy in the exclusive Woodmore subdivision in Prince George’s County, but had had multiple offers rejected. The client went with a foreclosed property, whose appraised value was $450,000 after the renovation; he had only paid $380,000 for it. Prather’s client opted for the “full” version of the 203(k) loan, required for large-scale renovations that exceed $35,000. The Stoners, meanwhile, worked with
HOMES:
ISTOCKPHOTO\SHAPECHARGE
the “streamlined” version for less than $35,000 since their repairs were relatively minor and didn’t involved structural changes. The down payment required for both versions is the same as it is for all FHA loans: 3.5 percent of the total acquisition cost, which, for the 203(k), includes the purchase plus the renovation costs. “The product has some limitations, but it’s very vast as to what you can do,” said Andrew Litchfield, the 203(k) manager of the Fitzgerald Financial Group at Rockville’s Monarch Mortgage. “It’s kind of open to interpretation.”
In the early days, the 203(k) program was commonly used by investors to purchase and flip properties that in many instances were owned by HUD. After 1996, however, investors were barred from the program due to cases of fraud where they would take out loans meant for construction and pocket a portion of the money. Now, only individuals who will occupy their properties, nonprofit organizations and government entities are eligible. In light of the loan’s history and as a safeguard against abuse, HUD mandates an extra level of scrutiny for the 203(k), requiring borrowers of the full version to hire a HUD-approved consultant to oversee the renovation and to monitor payments from a special renovation account to the contractor hired by the client. “The role of the consultant is to make sure the rehab project is completed according to the scope of work given by the contractor,” said Ray Amin, an architect and HUD-approved consultant based in Rockville.This scope of work document is important since it determines the home’s “after-improved” appraisal value, which is what the 203 (k) loan amount is based upon. If there is a critique to be made of the 203(k) loan, some say it’s that the process can feel cumbersome and requires patience. Donald Weinroth, a HUD-approved consultant based in Friendship Heights, said the extra paperwork and administrative costs for the 203(k) loan make it “a little difficult to work with.” Consultants are paid up to $200 per inspection, and banks may charge higher fees for servicing the loan. For larger projects,
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1842103
10 Navigating the Real Estate Market | APRIL 2012 SPECIAL SUPPLEMENT TO THE GAZETTE
Laytonsville
Jenny Slater 240-505-3565 301-983.0060
Laurie Lafferty 240.601.2988 (Cell) 301.924.1100 x7677
BACKS TO PARKLAN D
$2,249,000
y!
NEW LISTING
VISTA
$975,000
Pristine condition! 5BR, 3.5BA nanny suite. Granite tops, w/ appliances, HDWD SS Floors. Walk to NIH. cbmove.com/MC70 16251
Joseph G. Zorc 301.351.5274 202.333.6100
BEST VALUE IN
HOME, 2.5 ACRES
Chevy Chase
$899,000
Potomac
Patricia Jones 301.670.2641 pjones@gazette.net
BEST OF LEISURE
Silver Spring
$289,900 You’ll love the new kitchen, 3BRs, 2BAs, huge garage. One Level 2 car Living at its Best.
NATURE LOVER’S D! REDUCE
Brookeville
$510,000
Brookeville
Col. w/22x20 Room, 19x13 Bonus remodeled kit.,FR & swim club comm.
Susan Ellis 301.367.9032 (direct) 301.774.5900 (office)
CUL-DE-SAC LOT
ITS BEST!
Gaithersburg
$799,000
Frederick
$734,000
$446,500
Well maintained home with 4 BR’s, 2.5 baths, fireplace and private backyard. Fantastic oversized 2 car garage. Buster Maurer 301.924.4893 (direct) 301.774.5900 x151 (office)
PEACE & QUIET OF MONOCACYVA LLEY!
Adamstown
$400,000
Lrg wooded lots, pln, walk-out LL mins to Urbana, open flr Drive a little & w/fin. media rm/4th BR. save a lot! LNF Olney/Brookevil le Ofc 301.924.1100
Mount Airy
$300,000 SFH w/one car MBR w/private gar & lg main flr
BR on main lvl BA. An additional w/another FBA. & 2 more upstairs HOA fee & readyLow monthly to move in. Brenda Hawkins Finkel 301.922.2201 (direct) 301.924.1100 x7624 (office)
EASY LIVING AT
Gaithersburg
ITS BEST
$310,000
2BRs, 2FBAs, Mont. Co. Only nestled in wooded sec of garage. Open 4 years old! 1 lvl living w/ porch &space airy flr pln! Wrap-around for gardening. AND/OR DISABLED. AGE 62+ LNF Olney/Brookevil le Ofc 301.924.1100
Olney
$424,990
Garage TH. Open Hrdwd flrs main flr plan. level. Huge MBR & BA, FP and walkout basement. Sherwood HS
Annette Bergman 301.467.3275 (direct)
BEST VALUE IN
Silver Spring
LONGMEAD!
Sharon Mulholland 301.921.1040
TOP FLOOR
Silver Spring
$379,999 Spotless, 3 BR, 3.5 BA, gorgeous back yard, cul-de-sac setting.
Silver Spring
$153,250 Top floor, move in condition, upgrades, views newer from balcony, convenient to Metro.
Myung Lee 301.412.2529 (c) 301.417.7770 (o)
Ken Secrist 301.728.7944 (c) 301.417.7770 (o)
BRAND NEW LISTING
$214,900
Superb 3 BR large kitchen 2 BA condo, great views. &lots of space & transportationClose to public & community amenities.
Brigitta Bastek 301-537-4432 301-468-1600
Kemp Mill
NEXT TO LAKE
$399,900
Germantown
Incredible new renovation from top to bottom! 2.5BA single family 4BR, w/over $50k in new upgrades!
Corey Savelson 301.602.7073 (direct) 301.881.1700 (office)
$284,000
Newly renovated 3 fin. lvl. 3BR, 2.5BA TH. Gorgeous country kitchen. Backs to open space. Master BR w/sitting rm. & balcony. Estate Sale.
BACKYARD VACATION !
Gaithersburg
Realtors® : To advertise Patricia 301.6 your listin 70.2641 or gs call: Damon Mary Wykes 301-717-1040 301-740-8900
301.670.26
39
$230’s
Brand new listing! Immaculate 3 level basement adjacent TH w/ fin beautiful Gunners to Lake!
Corey Savelson 301.602.7073 (direct) 301.881.1700 (office)
SPACIOUS BRICKTOW NHOME
Gaithersburg
COLONIAL
$325,000
Priced to sell. Open kitchen with island, upgraded appliances, Hdwd eating area. MBR floors and with garden bath & sitting home warranty.area. 1 year
Kay Waters 301.921.1040
RACT R CONT UNDE
Olney
Derwood $774,900 6714 Applewood Pl., Derwood,
Majestic 5 BR Md. 3.5 BA brick colonial w/finished basement-wet bar, wonderful sunroom and beautiful 3/4 w/slate patio. House Perfect!! acre lot Michael Ray and Sunshine 301.980.8155 Properties 301.570.0087
SPOTLESS
Ray & Dru Mollenhoff 301.924.7656 (direct) 301.924.1100 (office)
IMPECCABLE SPACIOUS
Lori Connor 301.801.9600 (c) 301.253.5155 (o)
SPARKLING CLEAN
Unique blend of colonial warmth/charact modern open er plus floor plan. Large remodeled open kitchen & luxury MBR. In-ground pool and Koi pond.
PARADISE!
Backs to Hawlings Preserve. Beautiful River Contemporary, choice lot. Call 3.5 ACHouse info! for Open
Ray & Dru Mollenhoff 301.924.7656 (direct) 301.924.1100 (office)
SENIOR LIVING AT D! REDUCE
$169,900
Call Kathy Dixon 240.472.2949 301.774.5900 (O)
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SWIM CLUB COMMUNI TY D! REDUCE
Silver Spring
Joseph G. Zorc 301.351.5274 202.333.6100
LUSH GARDENS
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Dale Gold 301.437.3253 dalegold@mris.c
WORLD!
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Joseph G. Zorc 301.351.5274 202.333.6100
$649,500
$715,000 Picture-perfect home on 2 1/2 ac lot on culde-sac w/4BRs, 3 1/2BAs, remodl. highend kit. in 08, dramatic FR w/flr to ceiling stone FP, master
suite luxurious in-ground w/FB, fin bsmt, Damascus schools! pool. Privacy & views! No HOA. Call today!
PROUDLY PRESENT
GAITHERSBURG/WINDBROOKE $239,000 Large 2BR
5BR 4BA & LL nanny suite, on 1.37 gorgeous acres. HW flrs, marble Mstr Bath Suite. www.cbmove.com/ MC7065906
& POOL!
Gaithersburg
Lynn Holland 301-704-2956 (c) 301-253-5155 (o)
JUST LISTED!
Best value in area! Completely renovated. Drop dead gorgeous!
Patricia Murphy 202-445-4664 202-363-9700
$425,000
FANTASTIC! 5 BR, 3.5 Bath Colonial! The addition not only provides great living space, but it gives the home an open feel w/vaulted ceiling, sky lights, recessed lighting! Updated center-island kitchen parkland. Damascus and much more! Backs to High Cluster!
MOVE IN CONDITIO N!
DERWOOD/GRANBY WOODS $599,000 New Listing!
AREA
CT CONTRA UNDER
3BR, 2.5 BA Cottage, Granite, cherry cabs, close to everything! Entertaining! OFFERSSS appliances. Fab for WELCOME.
Gaithersburg
Jane Macedonia 301.404.9754 (c) 301.975.9500 (o)
PASTORAL SETTING
Joseph G. Zorc 301.351.5274 202.333.6100
COUNTRY COTTAGE
$1,450,000
Custom designed home w/prof sculptured gardens. Many luxury amenities include hrdwds, 3 frplces, w/stn wall frpl, lib scrnd prch, 2 stry FR w/walnut built-ins, moldings & much shopping & comm.more! Conv to schools, Rts.
(Office)
CLOSE IN BETHESD A
BETHESDA/ALTA
Magnificent Custom Stonefront Colonial with 6BR, 5.5BA on cul-de-sac, backs to parkland. Hwd flrs, 6 fireplaces, Almost 7,500SF, www.cbmove.com/ 2 gar. Virtual Tour MC6871371
Darnestown
Elegant estate acres, over 7K home, 2.78 sf, 6 bdrms, 5.5 baths, breathtaking views. A golfer’s dream!
RACT R CONT UNDE
Contact your Gazette Rep Today!
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STUNNING CONTEMPORA RY COLONIAL
TION
$799,000
4BR, 3BA home w/vaulted ceilings, family rm w/brick wall fp, huge deck w/wooded view & 2 car garage.
BETHESDA/AVENEL
Gail Crowder 301.670.2639 gcrowder@gazette.net
GREAT PRICE!
RY ADDI 2-STO
Potomac
1686266
Best Deal In Montgomery County!
HOMES: It’s a Great Time to Bu
EXTRAORDINARY OPEN & BRIGHT!
$515,000 Fabulous Colonial parkland, with a backs to heated swimming pool & spa. Remodeled kitchen, new flooring, & carpeting, 4BR, 2 1/2BA Sandra Lilllywhite 301.275.5444 (c) 301.975.9500 (o)