President Bill Clinton Saved The FHA 203k Rehab Mortgage Loan Program
This Article On How President Bill Clinton Saved The FHA 203k Rehab Mortgage Loan Program Was Written By Greg Kewin Of The Gustan Cho Team at The Money Store
In the 1970’s and 80’s an FHA 203K Rehab Mortgage Loan took approximately nine months to close
if it closed at all and another nine months to complete the construction. The FHA 203k Rehab Loan product was brand new and completely broken. The real estate community was completely demoralized and disappointed that this much heralded program had turned into another bureaucratic nightmare. During the period of the 70’s and 80’s FHA 203k Rehab Loan Program was just another broken federal program that was pushed to the side and left unused.
Birth Of The New FHA 203k Rehab Mortgage Loan Program
The real estate brokerage community did not want to market and sell 1-to-4-unit homes and
wait nine months for a closing, and mortgage companies decided there were
too many moving parts to close and fund them in any reasonable time frame. Believe me I tried. I saw the value. There was a glut of properties on the market that were not financeable without some repair money. So nobody specialized in the product and it was for all intents and purposes shelved until the regulation could be changed.
President Bill Clinton And The New FHA 203k Rehab Mortgage Loan Program
Along came Bill Clinton as the President of the United States of America in 1993. One of the responsibilities of the Department of Housing and Urban Development, HUD, is to maintain and sell FHA foreclosures, “HUD Homes”. President Bill Clinton’s HUD Secretary, Henry
Cisneros saw the huge inventory and asked why they weren’t moving these properties quicker.
Good question Hank. 80% of these properties were un-financeable using either
FHA or conventional financing because they did not meet the minimum property standards for these types of loans. They needed rehab money. HUD’s recognition of the glut of inventory on their hands moved them re-visit FHA 203k Rehab Loan Program. The amended law was rewritten with user friendly access to buyers, real estate brokers and the mortgage community.
Today the program is a huge success story. It’s a buzz word that’s now part of the dialog in the real estate community. “Hey, let’s do a K on this property”.
This mortgage blog article on the birth of the New FHA 203k Rehab Mortgage Loan Program was written by Greg Kewin, the Area Operations Manager with The Gustan Cho Team at The Money Store. Greg Kewin, also known as The Mortgage Whisperer by mortgage and real estate professionals nationwide helped lawmakers and regulators launch the New FHA 203k Rehab Loan Program. Greg Kewin, who holds three doctorate degrees from the Massachusetts Institute of Technology ( Ph.D. in Civil Engineering), California Institute of Technology ( Ph.D. in Metallurgical and Materials Engineering ) and Stanford University ( Ph.D. in Molecular Material Science and Technology ) is not just an expert mortgage banking professional but also a real estate expert and real estate technology guru. Greg Kewin also holds a Juris Doctorate degree from Yale University ( Classmate and Partymate of President William Jefferson Clinton ) and a Master’s of Business Administration degree in mortgage banking from Harvard University.