Renovation Realities with
‘The Reno Gal’

Join us for an insightful discussion with Jennifer ‘The Reno Gal’ Goldsby, a seasoned professional in the mortgage industry and the VP of Renovation Lending at Diamond Residential Mortgage Company. In this episode, we will explore the intricacies of renovation lending, focusing on effective communication, expertise, and exceptional customer service. Jennifer shares valuable insights, including the need for change in property marketing to highlight renovation financing options, the benefits of renovation programs, especially for first-time home buyers, and sharing multiple resources for finding reliable contractors. Whether you’re a lender, real estate agent, or homebuyer, this episode offers actionable advice to navigate the housing market effectively.

Questions Answered

• In what ways can renovation lending benefit first-time homebuyers, and how can it help protect their investment?
• What strategies can lenders and real estate agents use to change the way properties are marketed to include renovation financing?
• What essential qualities should HUD consultants possess, and why is there a higher issue rate on projects with HUD consultants?
• What accountability measures could be implemented to ensure better outcomes for renovation projects?

Episode Recap

Unpacking Vital Insights and Complexities of Renovation Lending

Renovation lending has become a vital tool for homebuyers looking to customize their living spaces and those wanting to breathe new life into dated properties. Jennifer “The Reno Gal” Goldsby, a seasoned expert in the mortgage industry with over two decades of experience, recently offered a wealth of knowledge on “The Construction Lending Podcast.” Host Sean Faries and Jennifer cover the nuanced world of HUD consultants, renovation loans, and the transformative power of programs like 203(k)s. In this comprehensive guide, we unpack the vital insights they shared and explore the changing landscape of renovation lending.

The road to specializing in renovation loans wasn’t straightforward for Jennifer. Her own tough home-buying experience led her to discover the 203(k) program during the housing crisis, and she became an advocate for the power of renovation lending to sustain business even in tough economic times. However, it’s important to acknowledge that this specialized field is not a one-size-fits-all solution; it demands self-motivation, thorough research, and honesty throughout the process.

Choosing the Right Renovation Loan Program

When it comes to renovation loan programs, Jennifer underlines the need to match the buyer’s profile and project requirements with the appropriate program. By considering elements such as the credit package and specific needs of the project, lenders can guide borrowers to the most suitable options available.

Numerous real estate agents and referral partners have regarded renovation loan programs as a lucrative asset for clients. Jennifer conversed about these programs’ potential and the challenges faced when promoting them. Jennifer’s tactical approach to educating listing agents through various channels has had a positive impact, signaling a shift in attitudes toward these mortgage programs.

The Importance of Valuation and Equity in Renovation Loans

As Jennifer explains, it’s crucial to consider the assessed value and available equity when delving into renovation loans, especially the FHA 203(k) loan. She notes that the property’s condition, time on the market, and input from selling agents and home inspectors are good indicators of a potential renovation candidate. However, inadequate equity can be a red flag. Lenders typically avoid referring contractors due to liability issues, sparking a discussion on how borrowers can find reliable contractors independently.

Finding Quality Contractors: Tips and Resources

Borrowers without industry connections may find the search for reliable contractors daunting. Jennifer recommends tapping into various resources, such as local builders’ associations, building departments, real estate and insurance agents, and organizations and local chapters of remodelers’ organizations to find qualified professionals.

The Role of Communication in Selecting HUD Consultants

One of the cornerstones of successful renovation lending with 203(k)s is the HUD consultant selection process. Jennifer emphasizes the importance of attributes like clear communication, extensive knowledge, hands-on experience, exceptional customer service, and a track record of documented performance. These factors are crucial when choosing a consultant who will navigate the complexities of home renovation projects. Another suggestion was to speak with HUD consultants to understand their approach to handling complaints and unauthorized work, which is essential. Monitoring their performance helps lenders and borrowers ensure successful project outcomes.

USDA Renovation Program: An Underutilized Gem
Jennifer spoke highly of the USDA renovation program, touting it as an excellent but underused option for first-time homebuyers. This program provides a comprehensive solution by wrapping the purchase price, renovation costs, closing costs, and prepaid expenses into a single loan, making homeownership more accessible.

The Critical Components for a Successful Renovation Loan Program
Jennifer highlights several crucial factors for lenders aiming to implement a successful renovation loan program. Top-level buy-in from management, extensive staff training, and integrating renovation packages are key to smoother operational flows. Moreover, the program’s success hinges on the dedicated oversight of a passionate product owner who can ensure borrowers receive the support they need.

Conclusion

This multifaceted conversation sheds light on the indispensable role of renovation lending in today’s housing market. From selecting the right HUD consultant to encouraging program awareness, facing industry challenges, and embracing the potential of lesser-known programs, the discussion offers valuable insights for industry professionals and prospective homebuyers. Whether you’re considering taking on a renovation project or in the business of lending, understanding these complexities is essential for navigating this ever-evolving space with confidence and expertise.

Connect with Jennifer Goldsby

Website: therenogal.com
LinkedIn: therenogal
Instagram: @therenogal
Phone: 844-RENO-GAL or 844-736-6425

Connect with Diamond Residential
Diamond Residential Mortgage

Learn more about creating successful construction loan programs