What to Do When Your Appraisal Is Under Review
Excerpt: Topics:
- Remember that reviewers are on your side
- Look out for these common points of contention
- “The number one mistake is that the appraiser did not include the lender’s specific report requirements,” Nakashima confirms. “Often, the appraiser will not read the lender’s requirements—and if those requirements are not in the report, it cannot be delivered, or the lender will send it back.
- Avoid future revision requests
“You can’t avoid the report being reviewed, but you can avoid revision requests,” he says. “Check your report for common mistakes. Review the specific lender requirements and make sure you covered all the bases. When you can’t meet a requirement, include a comment that explains why not.”
To read more, click here
My comments: Worth reading if you do lender appraisals. Some good tips for reviewing your non-lender appraisals. I have never had any reviews for my non-lender appraisals similar to the reviews above. When I did lender res appraisals for direct lenders before 2005, I was usually only contacted if I had a typo: address, no value, etc.
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To read more of this long blog post with many topics, click Read More Below!!
NOTE: Please scroll down to read the other topics in this long blog post on Condo risks, mortgage origination volume down, 4 high growth appraisal companies, cost cutting tips, unusual homes, mortgage origination stats, etc.
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$1.2M Glass and Steel House in Austin, TX
Excerpts:
1,638 square feet with two bedrooms and two bathrooms.
Though the walls are all glass, nobody can see in. “You have trees on one side and a rock wall on the other, which allows you to live one with nature. You can open up the doors and essentially be outside on a nice day.”
The glass walls are 30 feet high in some places, and there are 11 sets of sliding doors, which lead to decks on all sides of the house.
Though the walls are all glass, nobody can see in… “You have trees on one side and a rock wall on the other, which allows you to live one with nature. You can open up the doors and essentially be outside on a nice day.”
The glass walls are 30 feet high in some places, and there are 11 sets of sliding doors, which lead to decks on all sides of the house.
To read more and see lots of photos, click here
My comments: I have always wanted to live in a glass house (which was very private so no one could see inside). I want this house ;>
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Mortgage applications hit 22-year low (since 2000), lending activity suffers
Excerpt: Mortgage application activity has slowed more than expected to its lowest level in 22 years, as both refinance and purchase applications contracted, according to the latest data from the Mortgage Bankers Association.
MBA’s Market Composite Index, which measures mortgage loan application volume, slipped 2.3% on a seasonally adjusted basis for the week ending August 12. Unadjusted, the index dropped 3% week over week.
“Mortgage application activity was lower last week, with overall applications declining over 2% to their lowest level since 2000,” said Joel Kan, AVP of economic and industry forecasting at MBA. “Home purchase applications continued to be held down by rapidly drying up demand, as high mortgage rates, challenging affordability, and a gloomier outlook of the economy kept buyers on the sidelines.”
To read more, click here
My comments: If you’re still busy, make money while you can and consider trying to get non-lender work while your competitors are turning it down. If you’re slow, consider non-lender appraisals.
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Lots of ways to cut costs and increase profits
Business has slowed down for many of us, and fees are down. To increase profits, you increase income and/or decrease expenses. In the short term, it’s time to cut costs. Don’t forget personal expenses while you are looking to cut business expenses.
If you’re busy, why not take a little time to cut some costs and have more money?
Look through regular credit card charges.
Often we forget about monthly, quarterly, and annual services that we don’t use much. Although they often are not much individually, they can really add up. I recently reviewed all my credit cards and found recurring costs to eliminate or reduce.
Here are a few ideas:
• A data service I don’t use much and downgraded my plan.
• Personal publications I don’t read anymore.
• MLS in areas you don’t work very often. Find another appraiser or real estate agent who can help you.
• Get rid of excess stored stuff, such as old office furniture. Sell or donate it. Don’t pay storage costs for things you really don’t need. Don’t be a packrat.
• Do you really need an expensive support contract? How often do you call support? I never buy support contracts. I seldom call and am willing to pay the fee, usually around $50 to $100 per call. A lot cheaper than a contract. Are you using all the “bells and whistles” that cost extra? Do you need all of them?
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Inc. 5000 2022. The Most Successful Companies in America: Four appraisal companies are on the list:
- Nationwide Appraisal Network, No. 1427 with 451% growth
- Collateral Management, No. 2160 with 274% growth
- Home Base Appraisal Management, No. 4517 with 98% growth
- AccuComp, No. 4572 with 96% growth
Thanks to Housing Wire’s Appraised Value newsletter for compiling this list! Google the company names to see what they do.
To get more information on the 2022 list, such as the top-rated companies, click here
My comments: Wonder where the appraisal companies will be in a year or two? Today, appraisal is strong in some areas, and very slow in others. I don’t know why. Affordable home prices?
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New condo mortgage rules create barriers for borrowers
Excerpts: In response to the June 2021 collapse of an oceanfront tower near Miami, mortgage giants Fannie Mae and Freddie Mac are rolling out new rules covering condo loans – and critics say the stricter reviews are causing condo sales to fall apart, even in buildings with no structural issues.
Fannie Mae stopped buying loans for condo units in buildings where major repairs have been put off, or where the condo association has been ordered by local authorities to fix unsafe conditions, as of Jan. 1. Freddie Mac enacted similar guidelines Feb. 28.
The Florida collapse illustrated an uncomfortable truth about the nation’s condos: Some buildings have been neglected to the point that they’re hazardous. Decisions about repairs largely fall to residents serving on their condo boards. They must decide whether to impose hefty assessments on themselves and their neighbors.
What’s more, the structural integrity of condos is regulated by a hodgepodge of state and local rules. The Miami-Dade County Commission last week passed an ordinance that will require all condo associations and homeowners associations to publicly disclose financial and structural information.
To read more, click here
My comments: I have appraised many stacked condos and townhomes and heard many stories about how they are managed, especially boards that don’t want to spend any money. When I first started lender appraising in 1986, I read all the condo documents and reviewed the reserves. There was an older large townhome development in a nearby city that had very few reserves. I wrote about it in my appraisals. Fortunately, California finally made some required disclosure and management requirements, but I still see problems.Florida condo projects are particularly risky due to sea level rise, especially with waterfront locations. Florida’s limestone geology means that saltwater intrusion can easily damage structures, roads, etc. Salt water flooding comes onto roads in some locations.I would never own a condo or townhome. I might own a home with minimal common ownership features, such as a clubhouse. Definitely no pools – high maintenance costs and liability issues. And not in Florida near the water.
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Suspended House in Mendocino, California
Excerpt: Architect’s statement: The location of the land of this project was the edge of the cliff, so in designing this house, we decided to separate the house from the land of the project so that the house is suspended in the air, so we proceeded to design so that people in this project experience different sensations, The feeling of fear and excitement in the outdoor space and the feeling of calm and cozy space in the indoor space.We designed the house form in a sloping way due to the climate of the region. We used a mast for the design of this project and secured the house with Two categories of cable. That high cables bear the weight of gravity and the lower cables withstand lateral and upward wind forces.
To read more and see many photos, click here
My comment: Fascinating! Many interior photos.
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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 7AM to noon, Pacific time.My comments: Rates are going up. Some appraisers are very busy and others have little work. Varies widely around the country.
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Mortgage applications decreased 2.3 percent from one week earlier to lowest level since 2000
Mortgage applications decreased 2.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 12, 2022.The Market Composite Index, a measure of mortgage loan application volume, decreased 2.3 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 decreased 5 percent from the previous week and was 82 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 18 percent lower than the same week one year ago.“Mortgage application activity was lower last week, with overall applications declining over two percent to their lowest level since 2000. Home purchase applications continued to be held down by rapidly drying up demand, as high mortgage rates, challenging affordability, and a gloomier outlook of the economy kept buyers on the sidelines,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “However, if home price growth slows more significantly and mortgage rates move lower, we might see some purchase activity return later in the year. The 30-year fixed rate stayed more than two percentage points higher than a year ago at 5.45 percent but was down over 50 basis points from the June 2020 high of 5.98 percent, providing some relief for buyers in the market. The refinance index, however, fell five percent to its lowest level since November 2000, driven by a six percent drop in conventional refinance applications.” The refinance share of mortgage activity decreased to 31.2 percent of total applications from 32.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.0 percent of total applications.The FHA share of total applications decreased to 12.0 percent from 12.1 percent the week prior. The VA share of total applications increased to 11.2 percent from 10.9 percent the week prior. The USDA share of total applications remained unchanged at 0.6 percent the week prior.The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 5.45 percent from 5.47 percent, with points decreasing to 0.57 from 0.80 (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 $647,200) increased to 5.14 percent from 5.09 percent, with points decreasing to 0.33 from 0.59 (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 increased to 5.38 percent from 5.35 percent, with points decreasing to 1.01 from 1.02 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.The average contract interest rate for 5/1 ARMs decreased to 4.43 percent from 4.60 percent, with points decreasing to 0.43 from 0.63 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
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Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501
Phone 510-865-8041
Email ann@appraisaltoday.com
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