Appraisal News and Business Tips

9-7-17 Newz// Appraisers Helping Appraisers, SBA needs appraisers, It’s OK to Say No

Help Texas Appraisers Affected by Hurricane Harvey!

This fundraising campaign is co-sponsored by Mark Skapinetz (What’s It Worth Appraisal Services), Joe Mier (Joseph Mier & Associates), Lori Noble (The Noble Appraiser), Jonathan Miller (Miller Samuel Inc. Real Estate Appraisers & Consultants) and Phil Crawford (Voice of Appraisal).
As of 6pm 9/6/17 (West Coast time), at least two appraisers have donated the cost of an appraisal fee. 125 appraisers had contributed a total of $9,646 in the past 5 days.
If you have been affected by storms, you can apply to these folks to be considered to receive funding:
Mark Skapinetz:  wiwapp@gmail.com
Phil Crawford:  info@voiceofappraisal.com
Lori Noble:  lori@trpcg.com
Thanks to Dave Towne for these email addresses!
More info at:
Click here to donate
My comments: I prefer to give to people I know as it very satisfying. I started doing it 5-6 years ago. A former employee of mine became disabled and unable to work. I sent her $200 a month until she passed last year. A musician friend (my mentor), who is 82 years old, was trying to live on a small Social Security check. He sent me a Christmas card that mentioned some of his paintings for sale. I purchased a few for $400. Recently another musician friend in San Francisco was being evicted from his apartment after living there for over 25 years. I have been helping him send his records, CDs, etc. to friends around the country by using my UPS account.
I don’t know anyone personally affected by the Harvey disaster, but I contributed $100 as to help appraisers directly. I prefer to do this instead of donating to a charity. I also donate to charities, particularly local ones. I have my Amazon Smile account set up to automatically donate to the local Meals on Wheels. My living trust includes a large donation to my local NPR station, which I listen to every day.

SBA Seeking Residential and Commercial Appraisers to Aid Harvey Recovery Efforts

Source: Appraisal Institute’s Appraiser News Online email newsletter
Excerpts: The U.S. Small Business Administration announced Sept. 5 that it is seeking appraisers and other professionals to help process an extraordinary number of disaster loan applications resulting from Hurricane Harvey. SBA is the federal government’s primary source of lending to help homeowners, renters, businesses and nonprofit organizations recover from disasters.
Appraisers and assessors will assist SBA in determining the extent of damage for residential and commercial property… Individuals interested in participating in this effort will be assigned to either SBA’s Fort Worth, Texas, or Sacramento, California, office for up to 130 days.

http://www.appraisalinstitute.org/ano/sba-seeks-appraisers-to-aid-harvey-recovery-efforts/ 

Is the Traditional Appraisal Process Becoming Obsolete?

By George Dell, MAI, SRA, ASA
 
In the September 2017 issue of the
Paid Appraisal Today
Excerpts: 
If the traditional “process” is becoming out-of-date, there must be an explanation for it. What might be the cause?

There are two ways something can become less useful. The product may change in a negative way, or the world around it changes. The world around it may simply no longer need the service or product. Or, perhaps the service/product itself has changed to where it is less useful. Let’s look at each of these two possibilities.

Has the product itself changed? Most would answer yes. But has it changed for the worse? Let’s look…
To read the full article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
 
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7 Cute Converted Schoolhouses

Just for Fun!!
Here are two:
59475 State Highway 10, Hobart, NY
Price: $67,000 873 sq.ft.
72 Hilltop Rd, Sharon, CT
Price: $280,000 5 bedroom Colonial
Check out the fotos and more info here:

It’s okay to say No

By Ryan Lundquist
Excerpt: Here’s a conversation I had:
Loan Officer: Can you appraise a triplex fixer and bring a screw gun to the boarded property so you can get in? We need an “as is” value (note: picture above is not the triplex).
Me: Sorry, but I’m not willing to take a screw gun. I’m handy with tools, but that’s too much liability for me.
Loan Officer: I understand. Can you do an “as is” drive-by appraisal instead?… (Editor comment: there is lots more interesting conversation in the article)
Well worth reading, plus the many interesting comments at:
My comment: We have all had these types of conversations. In this blog post, Ryan gives some very good tips.

For unknown reasons, I have always said no to some appraisal requests, since the first day of my appraisal business. Sometimes I say yes, even after getting that “funny feeling” and almost always regret my decision. However, most business owners, including appraisers are unable to say no. Why? Fear of never getting another appraisal order.

Cost Approach Innovation

Excerpts: Brent Bowen, a Dallas area appraiser… has been proposing a completely different way of looking at the cost approach, particularly for residential appraisers.
There is nothing wrong with the cost approach. The principles and reasoning which underpin the cost approach to value are still sound. However, the existing, accepted methodology has been inadequate to achieve the stated goal. The cost approach is just that-an approach. The end goal is credible assignment results. If the assignment includes market value, then the existing methodology just doesn’t serve that end goal well, at least not in some markets.
… The primary difference in methodology that I am suggesting is to extract cost data directly from the market.
Read more here and check out the comments:

My comment: I was trained in a CA assessor’s office in the late 1970s. The cost approach was the primary, and often only, method used for decades. But, I was trained in a market based method and the cost approach was considered antiquated. When I started doing lender appraisals in 1986, a cost approach was expected. It is sometimes useful, such as new construction. But, in my area, there are very, very few residential land sales. Marshall & Swift manuals were almost always way too low. A market based method is much more accurate.

HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to www.mbaa.org 
Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.

Mortgage applications increased 3.3 percent from one week earlier

WASHINGTON, D.C. (September 6, 2017) – Mortgage applications increased 3.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 1, 2017.

The Market Composite Index, a measure of mortgage loan application volume, increased 3.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 2 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week. The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 5 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to its highest level since January 2017, 50.9 percent of total applications, from 49.4 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.2 percent of total applications.

The FHA share of total applications decreased to 9.6 percent from 9.7 percent the week prior. The VA share of total applications decreased to 9.7 percent from 10.0 percent the week prior. The USDA share of total applications remained unchanged from the week prior at 0.7 percent.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to its lowest level since November 2016, 4.06 percent, from 4.11 percent, with points decreasing to 0.38 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) decreased to its lowest level since November 2016, 3.96 percent, percent from 4.00 percent, with points remaining unchanged at 0.20 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to its lowest level since November 2016, 3.98 percent, from 4.02 percent, with points decreasing to 0.35 from 0.41 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to its lowest level since November 2016, 3.34 percent, from 3.36 percent, with points remaining unchanged at 0.38 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to its lowest level since November 2016, 3.14 percent, from 3.26 percent, with points decreasing to 0.31 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.

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