Becky, a client of Home Repairs and Remodeling, is in the midst of a complete renovation of her new home in the downtown Phoenix. After all the must do repairs are completed, she only has $5,559.00 to gut her kitchen and put in a “new” one, including a new gas stove, dishwasher, and microwave. A big challenge for even a “do-it-yourselfer,” let alone a general contractor! Can it be done?
Before Picture of Kitchen:
She acquired her property using the FHA 203(k) Renovation program. A quick summary of the FHA 203(K) Renovation program goes as follows:
1. Buyer finds a property that needs a ton of work in the area they desire (usually a bank owned property fits this description…missing flooring, missing cabinets, bad roof, A/C needs work, broken windows, etc). Let’s say the home is being sold for 80k.
2. The home is being sold at a discount because the seller does not want to spend the money to make the repairs.
3. Buyer has qualified for a FHA loan up to 125k.
4. Buyer writes offer for 80K. Buyer has home inspected by HUD consultant to find out what is required to bring it up to FHA standards.
5. Buyer also informs Home Repairs and Remodeling what other items they would like to add (new windows, new cabinets, new paint, etc). Buyer can remodel anything in her home as long as buyer stays within their qualified budget of 125k.
6. Total funds needed to meet FHA standards plus meet the wants of the buyer are 110k. The lender approves loan for 110k.
7. Buyer agrees to proceed with Home Repairs and Remodeling. Once escrow closes, 80k is given to the seller, and 30k is held by the lender. Home Repairs and Remodeling begins making the repairs and renovations. Once work completed and passes inspection, lender releases funds to Home Repairs and Remodeling.
Now, let’s get back to Becky’s situation. She needed a new electrical panel, all new windows, new carpeting, HVAC work, new block fencing to secure property and provide safe yard for her new puppy!
The kitchen needed major updating, yet there were not enough funds to replace the beat up cabinets and outdated countertops with new cabinetry and granite countertops. What to do on a very tight budget?
“Go green Becky!”
Immediately her first response was that going green would be more expensive. Big myth! John D. Wagner, Green Editor for the magazine Qualified Remodeler, points to five basic tenets of green building. John says for the most part a product is green if:
1. It improves indoor air quality.
2. Uses recycled/recyclable materials.
3. Reduces water consumption.
4. Is sustainably harvested.
5. Reduces fuel consumption (carbon footprint) during the manufacturing, delivery, installation and use.
So, Becky and Home Repairs and Remodeling got to work. Today they visited Stardust, to find kitchen products that could be re-used. Bingo! They found 15 Linear feet of butcher block that someone had turned in.
$175.00 later, Becky had her countertops. The countertops will need a layer of wood sanded off, plus staining and sealing, but it was still a great find. They also saw where they could buy someone else’s disposed of cabinets at a fraction of the cost they would have paid for new ones…and then have cabinets painted with low to zero VOC paint. Once layout of cabinets finalized, Becky will be back to purchase the used cabinets and Home Repairs and Remodeling will make them look like new again. By saving on big ticket materials, Becky was able to pick out a brand new farm-style sink and faucet from IKEA.
So, please continue to follow this story as it develops. We will keep you posted on the progress through pictures and keep a tally running to see if we can do it under the tight budget!