Appraisal News and Business Tips

11-29-18 Newz// Proposed $400k threshold for appraisals -The American Garage – a very strange room

$400,000 Proposed bank threshold for appraisals to be replaced by evaluations

Below are links to the proposed rule, what others are saying, and where to send your comments on the proposed rule.
OCC Issues Notice of Proposed Rulemaking to Exempt Residential Real Estate Transactions of $400,000 or Less from Appraisal Requirements
Excerpts: Rather than requiring an appraisal, the proposal would require that residential real estate transactions exempted by the threshold obtain an evaluation consistent with safe and sound banking practices.

Read what the OCC says in their announcement – one page

Comments will be accepted for 60 days from publication in the Federal Register.

Instructions in the full Full 69-page proposed rulemaking. Download the above link and search for comments

The word “evaluation” is included many times in the document. Google evaluation to see what it says.

FDIC, OCC, Fed propose raising appraisal threshold for first time since 1994. Good analysis of how many loans would be affected:

Push to cut back on home appraisals sparks controversy
By Ken Harney, long time nationally syndicated real estate writer who regularly writes about appraisal issues

Excerpt: The Trump administration wants to eliminate professional appraisals on a large number of home-sale transactions – a move that critics say could push the country back toward the see-no-evil days of mortgage lending that preceded the housing crash.

Includes comments from appraisers Ryan Lundquist and Pat Turner plus Appraisal Institute.
Link to Appraisal Institute letter
Get rid of appraisers while nobody’s looking
By Ryan Lundquist


Excerpt: I’m guessing these “evaluators” will be real estate agents who do BPOs, employees at banks and data firms, and probably some appraisers who need the work at $75-$100 a pop.

Read it here, plus the appraiser comments, of course.

My comments:
– FIRREA increased the deminimus from $200,000 (1989) to $250,000 in 1994, but appraisals were still done. Why? Fannie and Freddie’s investors wanted them. FHA, VA, etc did not adopt the deminimus.
– What is an ‘evaluation’ and who does them? Hopefully, someone will tell me what is an evaluation?

AI  classes

Coester in financial difficulty?

Brian Coester claims “We are not out of business,” as AMC runs into financial difficulty

Excerpts: The Maryland law firm of Shapiro Sher Guinot & Sandler PA sent a letter November 14th to the appraiser clients of one of the nation’s largest appraisal management companies, CoesterVMS.

This letter marked the beginning of tough times ahead for owner Brian Coester.

Responding via text, Coester said, “We are not out of business,” and that he was in the process of getting “what the bank did corrected.”

My comment: Coester responded via text?? I am so glad Housing Wire wrote about this!! I tried calling various Coester phone numbers but only got a recording asking to leave my name and phone number. I watched the appraisal blogosphere take off and tried to read the very fuzzy letter. I have no idea what is really happening. Is Coester going out of business? Not clear now. Hopefully, Coester does not owe you any money.

I have written about collecting past due fees many times, usually when business is slow. Guess it is time to write about it again… My Prime Advice: The Squeaky Wheel Gets the Grease!! Call, email, text, them incessantly.


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FHA: Electronic Appraisal Delivery System and Other Appraisal-Related Updates

FHA INFO #18-46, November 19, 2018
The Federal Housing Administration (FHA) announced that it is making several improvements in its Electronic Appraisal Delivery (EAD) system and other appraisal-related functionality in FHA Connection, including:
   Appraisal Logging screen changes;
   Appraisal Transfers; and
   Digital Signatures on Appraisals.

To read the document, click here

Why There’s No Place Quite Like the American Garage

The garage is a symbol of suburbia, a site of rebellion, and a very strange room.

Excerpts: “We think about it as this weird tumor that was attached to the house,” says Ortega. “It’s the first time the machine is given a room to sleep in.”

If Ortega were giving a world tour of important garages, he would begin with the Robie house, then jump to L’Attico, a garage in Rome that artist Fabio Sargentini transformed into an exhibition space in 1968. He would include the El Diablo house where Steve Jobs and Steve Wozniak invented the personal computer, and, as an example of the connection between garages and a certain creaky notion of American masculinity, the garage from the movie American Beauty, where Kevin Spacey works out and smokes weed in opposition to the limits of his suburban life.

My comment: Read this Very Interesting article. Garages will never be the same again ;>

Trends in Modular and Other Non-Site Built Housing

Excerpt: The total market share of non-site built single-family homes was 3.3% of single-family completions in 2017, according to Census Bureau Survey of Construction data and NAHB analysis. This share is expected to rise in 2018 and in the years ahead, due to the ongoing labor shortage in the residential construction sector and the need to lift labor productivity amid declining housing affordability.

For 2017, there were 26,000 total single-family units built using modular (12,000) and panelized/pre-cut (14,000) construction methods, out of a total of 795,000 total single-family homes completed. While the market share is small, there exists potential for expansion. Moreover, this 3.3% market share for 2017 represents a decline from years prior to the Great Recession. In 1997 and 1998, 7% of single-family completions were modular (4%) or panelized (3%). This marked the largest share for the 1992-2017 period.

One notable regional concentration is found in the Northeast where more than 5% (3,000 homes) of the region’s 59,000 units completed were due to modular construction.

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 
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 or send an email to . Or call 800-839-0227, MTW 7AM to noon, Pacific time.

Mortgage applications increased 5.5 percent from one week earlier

WASHINGTON, D.C. (November 28, 2018) – Mortgage applications increased 5.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending November 23, 2018. This week’s results include an adjustment for the Thanksgiving holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 5.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 29 percent compared with the previous week. The Refinance Index increased 1 percent from the previous week. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 28 percent compared with the previous week and was 2 percent higher than the same week one year ago.

“After several weeks of market volatility, 30-year fixed mortgage rates decreased four basis points to 5.12 percent last week. Homebuyers responded, with purchase applications 1.7 percent higher than a year ago, and after adjusting for the Thanksgiving holiday, they increased almost 9 percent from the previous week,” said Mike Fratantoni, MBA’s Chief Economist. “The rise in purchase activity was led by conventional purchase applications, which surged almost 12 percent, while government purchases were essentially unchanged over the week. This also pushed the average loan size for purchase applications higher, which likely meant there were fewer first-time homebuyers in the market last week.”

Added Fratantoni, “Refinance activity increased slightly overall, driven by conventional refinances, while government refinances decreased, as both FHA and VA applications dropped over the past week.”

The refinance share of mortgage activity decreased to 37.9 percent of total applications from 38.5 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.9 percent of total applications.

The FHA share of total applications decreased to 9.6 percent from 10.7 percent the week prior. The VA share of total applications decreased to 9.9 percent from 10.6 percent the week prior. The USDA share of total applications remained unchanged from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 5.12 percent from 5.16 percent, with points decreasing to 0.46 from 0.48 (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 $453,100) remained unchanged at 4.88 percent, with points increasing to 0.31 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 5.11 percent from 5.08 percent, with points remaining unchanged at 0.63 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 4.53 percent, with points remaining unchanged at 0.51 (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 increased to 4.29 percent from 4.24 percent, with points decreasing to 0.42 from 0.51 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please, contact or click here.

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.

Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
2033 Clement Ave. Suite 105
Alameda, CA 94501 Phone 510-865-8041
Fax 510-523-1138
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