To become an HUD approved 203(K) Consultant, an applicant has to follow the process outlined in the HUD Mortgagee Letter 2000-25 issued on July 26, 2000. The approved consultants are placed on the HUD 203(K) consultant roster and can be looked up using the search form on the HUD's website.
The following documents duly filled with relevant information must be submitted by the applicant to their local HUD Home Ownership Center (HOC) for approval. A placement on the consultant roster of your local HOC is also recognized by all the other HOCs in other parts of the country. In the event of a change in the primary location of your business, inform your local HOC of such a change.
If an applicant fails to submit any of the documents required for processing a 203k consultant application, HUD will likely send a letter pointing out the deficiency. A duration of 15 days is given to correct any missed/incorrect information or send in the supporting documents. It is very important that the applicant take the letter from HUD seriously and satisfy any additional requirement mentioned there. If a satisfactory reply is not received within the allowed duration of 15 days, the application must have to wait for another 90 days before re-applying.
Upon meeting all the requirements, an applicant is accepted and placed on the HUD 203k consultant roster. A participation letter containing the consultant's name, business address and a unique consultant identification number is mailed out to the consultant. The identification number is necessary prior to undertaking any work related to 203k loans.
HUD periodically reviews the performance of consultants by tracking them with the help of the consultant identification number. The consultant Id must also be entered on the insurance application screen and no 203k loan cases can be processed without entering it. Borrowers working with a consultant must also note that HUD does not specifically endorse or make any warranties regarding the performance or quality of their work. Being on a consultant roster only indicates that the required qualification to undertake 203k loan work has been fulfilled by the applicant.
If you would like to verify the credentials of a consultant, ask for the original HUD issued participation letter or search the consultant roster online to verify details.