Appraisal News and Business Tips

2-28-19 Newz: Strange listing fotos – $400k deminimus – FHA violations

Strange and tricky listing fotos

A real estate photographer tells you how to spot staging tricks in listing photos

Excerpt: “If a photo is overly bright, over contrasted, or almost too perfect or synthetic, that should be a red flag,” Cato says.

Another is if the photo has the same level of lighting everywhere. “It’s weird,” he says. “If the brightness is the same throughout, that is just not natural. You have to show where natural light falls.”

My comment: Written about New York apartments and condos but relates to all listing fotos. We all use comp listing fotos. Tips on how to evaluate them, including digital alterations, is always good!!
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The Most Hilarious Pictures Taken By Real Estate Agents
Just For Fun!!

Excerpt: From horror movie-esque semi abandoned flats for rent to excessively unique home decor cases and very impractical architecture decisions, the real estate agents behind these funny ads didn’t even care to fix the places up before snapping the hilarious pictures. The caring levels were so low that there’s also a photo with a live bat in it, a huge pig laying around in the living room and feral horses relaxing in front yards. The most baffling part is that these funny photos were really used to advertise and show the good side of housings to possible tenants.

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Common FHA Violations

Excerpt: I’ve been performing FHA appraisals since 2000. Believe it or not, on a regular basis, I have home owners and real estate agents who tell me that some of the things I point out as FHA violations, were never mentioned in other FHA appraisal inspections. So, I thought I would mention some relatively common FHA violations I see when making my FHA inspections.

My comment: Funny Fotos and Videos!! I have seen similar photos around but there are many here in one place. Written for home owners, but good reminders for appraisers.

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Feds Deny Public Hearing on proposed deminimus increase to $400,000

Excerpt:

The Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency have denied  the request for a public hearing on raising the appraisal minimum threshold for residential real estate transactions from $250,000 to $400,000. See the “agencies” rejection letter here.

“…we do not believe that holding a public hearing would elicit relevant information that could be conveyed through the comment process described above. While the agencies are, therefore, declining your request for a public hearing, we will carefully consider your written comments…”

My comment: Appraisals kept being done with the first deminimus of $200,000 30 years ago. Why? Fannie investors wanted appraisals. Fannie’s investors decide what is use as an alternative: waivers, AVMs, bifurcated, desktop, previous appraisal etc. Fannie moves very slowly. I don’t see anything happening very soon, except continuing to gradually chip away at the number of full appraisals and appraisers. With lots of appraisers retiring and very, very few new appraisers since 2008, outlook seems okay for those that remain, assuming they will do AMC appraisals.

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Appraisal waivers & the foreclosure wave video

By Ryan Lundquist
Excerpt: Here’s a Q&A with with Scott Short on appraisal waivers and “hybrid” appraisals. I get things changing for appraisers in light of big data, but diminishing the role appraisers play seems like a bad idea for the housing market. Watch here. If you want to just hear the “hybrid” part, it’s at 7:12.

My comment: I have been hearing about this video for awhile (appraiser-negative). Now, you can see it and add your own comments!!
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Disability – your greatest risk

In the paid Appraisal Today

Excerpt: Many appraisers worry about the risk of getting sued on an appraisal, but one of your greatest risks is becoming disabled and unable to work. To appraise at your
full capacity, you have to be able to walk, hear, and see.
If disabled, you may be able to continue working, but at reduced capacity.

Or, you may not be able to do field work but you can do desktop appraisals and reviews. But, you will probably not be able to work at all for a period of time.

Since appraisers spend a lot of time driving, getting in an auto accident is a much higher risk than for people working in an office. Other risks include getting injured during an inspection, plus the risks we all have of a serious medical
problem.
 
In the September 2018 issue of the paid Appraisal Today, available to paid subscribers.  
To read the full article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
 
If this article helped you when you were unable to work or worry less about it, it is worth the subscription price!! 
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https://appraisaltoday.com/2019/02/26/3918

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If you are a paid subscriber and did not get the February 2019 issue, emailed Friday, Feb. 1 2019, please send an email to info@appraisaltoday.com  and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it.
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Heads Up! Scary Hunting Lodge Home Shoots to Top Spot of Most Popular Listings

Excerpt: Lions, and tigers, and bears … oh my! And in a house? A Minnesota hunting lodge has bagged another trophy: as this week’s most popular home. Inside, the home is filled with countless stuffed animal heads (and other body parts), mounted and displayed in a jaw-dropping showroom.

My comment: This listing replaced the sex basement listing from last week as Number 1. Not sure what that means ;> Scroll down to the bottom of the long list of top 10 listings for more info. Lots of fotos in the listing. To see the animals start at foto #32

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Ditech files for Chapter 11 bankruptcy for second time in 14 months Feb. 11, 2019

Excerpt: Ditech announced early Monday morning (Feb. 7) that it, along with its subsidiaries Ditech Financial and Reverse Mortgage Solutions, have entered into a “restructuring support agreement” that will seek to restructure the company’s debt, because the last time wasn’t enough, apparently.

My comment: I hope Ditech does not owe you any money!! I didn’t even know they were still in business….
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What is a USPAP Violation?

By George Dell, MAI etc.

Excerpt:

You did a bad-a USPAP violation!  They said so!  Are they right?
A violation.  A strong word.  Clear and succinct.  Easily understandable by anyone.  Of course.  Black letters on white.
Where in USPAP does it identify (for real property) what is a violation or not?
We can look at three parts of USPAP;
My comment: Worth reading. Very interesting blog post. I would somehow include lying. Wonder what the state regulators will say? Maybe some of them will make comments. What about USPAP Nerds? I agree with George, of course!! I started appraising long before USPAP and somehow we all knew what was right.
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Mortgage applications increased 5.3 percent from one week earlier

WASHINGTON, D.C. (February 27, 2019) – Mortgage applications increased 5.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 22, 2019. This week’s results include an adjustment for the Washington’s Birthday (Presidents’ Day) holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 5.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week. The seasonally adjusted Purchase Index increased 6 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 3 percent higher than the same week one year ago.

“Mortgage rates were little changed last week, but as we anticipated, homebuyers are responding favorably to this more stable rate environment,” said Mike Fratantoni, MBA Senior Vice President and Chief Economist. “Purchase applications for both conventional and government loans rose last week, with the government gain led by a 14 percent increase in applications for VA purchase loans.”

Added Fratantoni, “Refinance application volume increased as well, with the index reaching its highest level in a month. Borrowers with larger loans tend to be more responsive for a given drop in rates, and competition for these loans is fierce. Therefore, it was not surprising to see the average rate for a 30-year fixed jumbo loan drop to its lowest level since January 2018.”

The refinance share of mortgage activity decreased to 40.4 percent of total applications from 41.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.3 percent of total applications.

The FHA share of total applications remained unchanged from 10.2 percent the week prior. The VA share of total applications increased to 10.7 percent from 10.1 percent the week prior. The USDA share of total applications decreased to 0.6 percent from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.65 percent from 4.66 percent, with points remaining unchanged at 0.42 (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 $484,350) decreased to 4.40 percent from 4.56 percent, with points increasing to 0.29 from 0.23 (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 4.64 percent from 4.68 percent, with points decreasing to 0.48 from 0.58 (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 4.00 percent from 4.04 percent, with points decreasing to 0.38 from 0.44 (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 3.95 percent from 4.00 percent, with points increasing to 0.4 from 0.24 (including the origination fee) for 80 percent LTV loans. The effective rate increased 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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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
Email   ann@appraisaltoday.com

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