Do we need a termite report on a 203k loan? Gilroy to Stockton

By
Home Inspector with 203kOnLine.com, covering California & most other states S0289

The HUD guideline for the FHA 203k loan program doesn’t “require” a pest control report however it does “require” a pest control clearance at the end of the project. Therefore all of the lenders I’m aware of have a “supplemental requirement” calling for a pest report going into the project if it is a “full 203k loan”.

What about a Streamlined k? Do we need a pest report? Not necessarily. If you don’t have one you don’t need to respond to the repairs. If you have one and it is a streamlined k, you now have to clear it.

On the other hand if the appraiser sees dry rot or termite damage they will call for a termite report and in doing so it is quite often deemed a structural issue and becomes a Full 203k.

If it isn't required why do we always get a termite report on a full 203k? It is a lender requirement. Since the program requires a clearance at the end of the project the lenders are smart enough to require we know the down side before it closes escrow. 

Posted by

Mike Young, 203k Team Leader    Mike ready for your 203k order

With offices coast to coast and HQ now at PMB 168, 5055 Business Center Drive, Suite 108 Fairfield, CA 94534 1.707.812.7668. We have fourteen offices in CA covering both CA states, NorCAL and SoCAL where we can cover the entire state.

To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation". If you like what you see here please take a look at Another blog by Mike Young in Spanish and other languages. Got a 203k porject giving you "fits" contact Mark from NV at www.203k911.com, is having more fun with this new site than anyone should. If you are looking for a quality 203k software for ease of underwriting and to help lenders and consultants provide quality service and reports to their clients.

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Topic:
Real Estate Best Practices
Location:
California Santa Clara County Gilroy
Groups:
Stockton Real Estate
San Ramon, California
Galt Real Estate
Elk Grove Real Estate
Tags:
san ramon
pleasanton
livermore
stockton
203k consultant gilroy

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Rainmaker
267,041
Jeff Pearl
RE/MAX Distinctive / LIC in VA

I think it's best to just get one to avoid delays. More and more lenders and investors are requiring them now. They're only around $50.00.

February 29, 2012 09:01 AM
Rainmaker
267,041
Jeff Pearl
RE/MAX Distinctive / LIC in VA

Hi Mike, I received this from a loan officer not long ago.

Most mortgage investors are now requiring the lender to receive a copy of the termite report prior to closing on all purchase transactions.  Previously the reports have been requested on Veterans loans and when the appraiser requires it.  Lenders must include the cost for the termite fee on the Good Faith Estimate.  A termite report supplied to a lender should show the house is clear of infestation and or show treatment or repairs have been made by a licensed contractor.

February 29, 2012 09:09 AM
Rainmaker
414,196
Mike Young
FHA 203k Consultant 707-812-7668
203kOnLine.com, covering California & most other states

Jeff,

Even as an investor I always got a termire report. It just makes good sense. Thanks for the comments.

M

March 01, 2012 09:38 AM
Anonymous
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Rainmaker
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Mike Young

FHA 203k Consultant 707-812-7668
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