Session #1 What's In It For Me WIIFM?

Good evening everyone and welcome to wiifm Reasons why Every Real Estate Professional should know more about FHA loans. This is the first in a series, a 12 week series that will be held every two weeks for the next six weeks on 203k secrets revealed. I thank you so much for being on the webinar today. I am your host for for this entire series. My name is Kathryn Hall. I'll tell you a little bit about me in just a few minutes, but I just want to give everybody a chance to get on the webinar. We will be recording these webinars and you'll be able to have access to these replays from the same link 203k Secrets revealed that you were able to use when you logged in the very first time. And also you will be receiving emails letting you know about our upcoming next event in the series. So I want to thank everybody for being on the webinar today. And I just want to let you know that 80% of success in your career will come from just showing up. Anyone who knows me knows I will always believe in the principle that 80% of success is just showing up. And with that being said, the world is run by those who show up and not by those who wait to be asked. So we asked you to be here, but you did show up. And this is going to be your opportunity to learn some skills, to maybe brush up on some information you already may have had and to find a new path to be able to provide yourself and your family and your business with a sense of financial freedom and prosperity that you might not have right now or you might want to improve upon. And so what we're going to do today, and this is going to be a quick 35, maybe 40 minutes, depends on how long we can get through everything. I planned it for 30 minutes. And today what we're going to learn is how to leverage your existing skills. Now, we know many of you have skills as home inspectors. We have contractors on the webinar today. We have real estate lenders, we have real estate agents. We have people from all walks of the world of real estate consulting and residential real estate. And that's what our focus is, to help you be able to find an opportunity to increase your money, to decrease the amount of time and effort that you have to spend in your business right now and to help create that business strategy that will let you take yourself above and beyond your competition. We all have competition. Sometimes it astounds us and sometimes it frustrates us to know that we have competition and so here is just basically a slide that shows you the information that I think about when I think about competition. How do you set yourself apart from your competition and what we're going to do today. The things we're going to talk about with regard to rehab loans and203 I believe are going to check off all the boxes. So the first box is find your edge. Everyone has things that they're naturally good at. Well, for all of us it is that we're naturally good at understanding defect recognition, identification in construction, in residential environments. And for most of us, being as we are, home inspectors, contractors, lenders, real estate agents, 203k consultants, we have an ability to communicate that information to the non experienced, non trained person in a way that they can understand it. We can write reports, we can create bid packages and proposals. We can process information that people can understand and feel comfortable with even when we are not Even with our skills as high as they are, we are able to bring it down to the level that people will have and make it so that it's easy for them to work with. And most of us have clear cut goals. We know why we're in business. What is the reason why we're all in business. Type it in the chat box for me right now. Everyone knows why you're in business. And if the answer is not to make money, there's a problem. Because that's the only reason why you should want to be in business. And when you think about that business, you want to basically put that goal of I want to make money. But more important than making money, you want to help people. That's the goal of our association. That's my personal goal, to help people. And so what we're going to talk about today is how you can dedicate your work, be transparent. I hope I show that type of transparency today in our conversation today and learn from every experience that you have available to you. And I am going to share with you an opportunity where you can learn even more about the growing and fascinating world of rehab consulting. So now the title of the presentation does say 203 secrets revealed. But we're not just going to stop at 203k. We're going to cover all types of rehab loans and all types of programs that are available out there in the market for us to be able to work with. So don't think it's just 203k. We're going to talk about the whole gamut of the type of programs that you can have. And so now you look at this slide here, and that does not look like a future building consultant with my Chippendale slippers on. That left picture with me in yellow. I don't think I've ever been seen in yellow again after that slide, after that picture was taken. And you probably will never see me in yellow again. But my upbringing and that picture with my mother is very special to me. My mother died when I was 12 years old of lupus. And one of the things that she did was she received her master's degree in education posthumously. She worked up until her death on becoming a. She wanted to get her master's degree in education. She was a schoolteacher. I remember her laying in bed sick as she could be grading papers and I would be helping her grade papers. And she showed me that nothing should stop you from working towards your goals short of death itself. And even after death she was able to accomplish that goal. And so she is my visionary, she is my mentor, and she is who I model myself after in my life. And I work to not give up. No matter what obstacles, no matter what challenges, there is nothing that can stop you from achieving your goal if it is truly one that you want to receive. So who am I? I believe you don't hear a person's words until you know who that person is. Well, first of all, I am the owner, former owner that is of a multi inspector and sperm in the Delaware Valley in Pennsylvania. And I ran that company for 11 years actually. Excuse me, 26 years. 11. Yeah, because there on the slide shows you the 20th anniversary slide.

I ran that company and owned that company as a sole owner for 26 years. And I was very blessed and able to sell it just this past year and pass the torch onto a person in the Philadelphia Delaware Valley who wanted to continue with home inspection. Part of my success in my local inspection company came from the fact that I recognized early on that education needed to be in a group setting. You were not going to be able to get your message across if you were trying to go one to one to one. So early on in my career we created and formed a partnership with a lender to teach about real estate lending, specifically 203k loans, energy efficiency mortgages, Fannie Mae home style loans and VA loans. So with that type of business opportunity opening up and managing a real estate school, we were able to get in front of 30, 40 agents at a time, sharing the message and the opportunity of rehab loans. And what I'm going to share with you today is a little tidbit of what we share In a broad sense, as members of the national association of FHA Consultants. So as I was growing my home inspection company, I realized that I needed to have, as all businesses do, I needed to have a usp. And usp, for those of you who don't know, and if you do, type it in, the chat box stands for Unique Selling Point. Another phrase is Unique Selling Proposition. There needs to be something completely unique, special and different about you and your business that separates you, like I said before, from your competition. What is your edge? And for my business, 26 years and running, our biggest USP was that all home inspections were performed by FHA 203k consultants. In order to achieve that goal and not have to spend time sitting with people at a table explaining to them all about 203, I created a product called the 203K in a Box. And in its early days, it literally was a box of all the materials and support tools and resources that I had developed for how to get certified, how to be educated, trained to function as an FHA consultant. So when I had a new employee start in my firm after they had completed the seasoning period required to be an FHA consultant, if they did not come with the prerequisites, then we just basically would give them that box and they were able to successfully become a certified consultant. One of my mentors saw that I was able to reproduce this over and over and over again and suggested, why don't you share this with our mentoring group? Which was a mentoring group of home inspectors and home inspector firms. I shared it with them over 12 years ago and was successfully able to get them able to be successful consultants and trained and certified to be able to start their businesses as FHA consultants. And so once I realized that I had so many people who were all doing a service the same way with the same quality of care and most of us using the same software, I said, why don't we let the world know that we are here doing something the way everybody wants to do it, in a way that everybody will be happy to see gets done. Because if people love the way I do consulting as much as they did, once they know that I've trained these individuals, they're going to want to work with them because they'll know if you're a member of nfac, you came from an organization that you were trained and certified and are following a model similar to the one that Kathryn hall utilized. And this has been a very, very successful resource for us. And we now are over 150 members strong. So one of the things that we decided to do with NAHFAC was, and that's the national association of FHA Consultants was we realized that in order to create that consistency and continuity and quality, I needed to create a software. And with that became the birth of the Genesis Rehab Reporting system. And this is the biggest jewel in our crown because with this software, the only web based, 100% web based system that allows a contractor to be able to enter his bids electronically into the system, that allows that contractor, that allows the borrower home buyers or homeowners to view those bids and reports as well as then after closing, have the contractor submit his bids electronically into the system so that everything is all in one place and properly formatted and no typographical errors or fax pages didn't get sent over or transposition errors or can't read the handwriting. All that's done now with Genesis and Genesis is a free benefit of all as one of the best free benefits of membership in nfac. So this is who I am. A home inspector and business owner of an inspection company since 1993, a former university of Drexel University Science center professor licensed in Pennsylvania in a number of things and now a successfully sold business owner who has now developed and moved into the experience of being the executive director of this national association that has members from far away as Alaska down to Hawaii. And so this is who I am. And many people feel that I have an expertise and knowledge worthy to be coming to you to talk about 203k. So ready to get started? I know I am. So what we want to talk to you about today is the fact that more and more people are using rehab loans. So now on the slide it says FHA insured mortgages. But I want you to substitute FHA insured mortgages for fha, Fannie Mae and VA and non structured rehabilitation loans or construction loans. More and more people are finding that they need help to be able to get the repairs done without leveraging their savings or leveraging money that they don't even have, but be able to include it wrapped up into the mortgage. And so just to give you an understand a brief explanation of what a rehab loan does. With a rehab loan, specifically the FHA 203k loan, a person is able to add to the cost of the mortgage, the actual rehab cost, and it's all built into one loan, one monthly payment based upon the after repaired value of the house. This is not a home equity loan where you can only borrow up to what you had in equity in the value of the mortgage, but a loan that's based upon what the property will look like and be worth after the completion of the renovation. And when you are using this type of mortgage, the lender and by extension FHA or VA wants to have some security that the work that is being done meets a certain prerequisite of safety and soundness. And they also want to make sure that the contractor's work after closing is carefully monitored and overseen by a neutral, objective, experienced person. Hence comes the need for FHA consultants. And so with rehab loans, more and more buyers and existing homeowners are able to open up more home availability. They're able to keep homes that they thought they would have to sell to get bigger homes by expanding the existing home finding it's cheaper to keeper. And so we're going to talk in the upcoming series more about the Fannie Mae home style, the VA loan, what it takes to qualify for a rehab loan. We're going to talk about understanding the prerequisites for energy efficient mortgages. We're going to talk about cost estimating. We're going to go through all of these components of the whole world of renovation lending. And so today is just your introduction to what it is about rehab lending. And trust me, I hope you are aware that even during the six sessions or 12 weeks that we're going to be carrying this through, I'm not going to be able to give you 100% of the skills and knowledge you'll need. But I'm going to give you a starting point that I hope will excite you and energize you to understand what's going on and where you have an opportunity to, to grow your business and be able to step away from your competition. So what people don't realize is that 203k loans give those home buyers and existing homeowners. And so I'm just going to say home buyers, because many of us are working primarily with new home buyers. We give them a chance to be able to have more homes, to be able to purchase. They don't just have to look at those homes that are move in ready. They get to be able to have a home that's on a block near mom or near their best friends or whoever is closest to them. Even if that house is the worst house on the neighborhood. But could it be the best house on the block? That's what rehab loans a lot of people the opportunity to do. And you don't have to worry about are the utilities off, is the home Foreclosed, what is the borrower going to find after they move in? So you notice I slipped in the term borrower. That's because as an FHA consultant, as a rehab consultant, we refer to our clients not as buyers, because as I just explained, 45% of all customers who are using a rehab loan are refinancing an existing mortgage. And these are not buyers. These are borrowers and existing homeowners. So I'm going to. I slipped in the term borrower, which is our universal term for everything that refers to, to a client working with a rehab loan. Some of the possibilities that rehab loans offer to our clients is the ability to take an abandoned home and turn it, as you can see, into the showcase of the neighborhood. So if you're looking at this slide, and I don't know if you can see there, you can see on the image on the screen this picture here at the top, it had radiating heat, it had radiator heat and a steam boiler in the basement. And then once we completed the renovation, we ripped out all of those pipes, all of that system, and put in a beautiful hot, forced air heating and cooling system that increased the value of that property. And all of these repairs were completed after closing by a contractor who was selected prior to closing. So contractors perk up. Now, I'm talking to you for a minute. If you are a residential general contractor and you are looking for an opportunity to be able to expand your business and be able to have the ability to understand what this offers to their clients, and you have three or more years experience as a residential general contractor, you are eligible to be an FHA consultant. And what is the value of it to you to be an FHA consultant as a contractor? Because you can actually do both. You can contract on one project, you can consult on another, and by knowing what the consultant is going to look for in a property when you meet with the borrower, you're able to create an accurate scope of work and get the pricing for the work that you need because you understand all of the requirements that we'll go over in a minute with regard to mandatory, recommended and desired. With every transaction for a rehab loan, the borrower has the opportunity to select the materials they can use as inexpensive a material or system as they choose, or they can go as high and luxurious as their budget can afford. So many of your clients, both as home inspectors and contractors and FHA consultants, we're familiar with the term champagne taste and beer budgets. Well, this is where we can help the client understand what their budget can afford and give them the options and inside the loan that can help them meet the plans that they want to do. So as you can see in this slide, in the finished slide, there is a big hole next to the sink where the dishwasher would go. The borrower didn't or couldn't afford to add the dishwasher to the loan. And so it didn't need to be added. They're going to buy one on their own after they move in following the renovation. And the same thing with the refrigerator. So this gives a borrower a la carte homeownership. And it's very powerful because our goal as FHA consultants and I know that there are lenders and realtors on the line who appreciate this, our goal is to get the borrower on the other side of closing just as much, if not more than as you lenders and real estate agents want them to be. Because we know how critical it is to be able to get on the other side of settlement because that's where all the fun starts for us in our phase construction draw activities. I mentioned very.