Industry Insider Insight on Risk and Modernization

Excerpts: The Collateral Risk Network (CRN) met in Sarasota on December 6th to discuss a variety of issues ranging from appraisal turn times to Fannie Mae’s economic outlook for 2023. Bill Rayburn gave a rousing and lively explanation of exactly what quality means in valuation at a recent meeting. Lenders want a compliant document that allows the loan package to be sold as quickly as possible, while investors want an appraisal that allows for securitization or resale to another downstream buyer.

Appraisers were encouraged to provide convenience as one aspect of quality. His figures show there is a holding cost of $200 per day on an unclosed loan and this hinges on the appraisal which is the last thing in the critical path to closing. He suggested we redefine quality to include a time element.

Joe Minnich, a condo risk consultant, spoke on how loans secured by an individual unit in a condominium project have greater risk than found in typical SFR lending. Lenders must address the various layers of risk to ensure that the loan is of saleable quality and the likelihood the borrower can/will repay the loan.

To read more, click here

My comments: Bill Rayburn, Chairman, and CEO at mTrade, is an excellent speaker and very savvy. I have known him for many years. FYI, CRN (Collateral Risk Network) was set up for AMCs and lenders. It was “closed” to appraisers for a while but is open now. Worth attending.

Fannie New Appraisal Form Modernization

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on Fannie December newsletter, estate appraisals real estate market, unusual homes, mortgage origination stats, etc.


Danish Home Designed to Showcase Its Owner’s Vintage Car Collection

Excerpts: To conceive a home that was both open to the terrain and private, Ingels and his team began with a simple idea: arranging the house into a single long building, with cars at one end and living spaces at the other. “Then we took that logic and wrapped it around the top of the hill, creating a ribbon, or loop, that overlaps itself as it climbs the terrain,” he notes.

Cars enter the home at ground level, pulling into a gallery-like expanse that accommodates as many as eight vehicles. From there, rooms snake upward, arranged in a linear plan along a curved, gently sloping corridor that is illuminated by skylights but otherwise windowless. “The hallway has this infinite feeling,” says Ingels. “From many angles, you can’t see the end in either direction.”

To read lots more and see very interesting photos, click here 

My comments: Wow, And I’m not a “car person”!! I have sometimes seen house garages with a partially disassembled old car that the husband always wanted in high school and has been working on for many years.


Fannie December 22 Update – Facts, not Feelings


  • Verification tips for desktop appraisals
  • Don’t fear third-party data (1004 Desktop Limiting Condition 3)

Improve appraisal commentary with facts, not feelings

Excerpt: One exception to the use of words and phrases that are otherwise considered subjective is when the word is part of a property noun, such as the name of a place, street name, city, or a legal description of the property. For example, “good” and “boring” are generally unacceptable subjective descriptions, but if the property is located on Good Street in Dallas, Texas, or in the city of Boring, Oregon, then their usage is objective and acceptable as part of the place names.

We recently scanned millions of appraisals from 2021 – 2022 for subjective terms. After removing place names and similar exceptions, we found that three of the most common subjective phrases used by appraisers are: desirable location, desirable

neighborhood, and good neighborhood. Whether a location is “desirable” or not is a subjective idea…

To download the PDF and read more, click here

My comments: Focuses on desktop appraisals. Useful tips on facts, not feelings. This is a good reminder for all of us. Be sure your name does not appear in the newspapers because you “discriminated” against Black borrowers.


Appraisals for estates and trusts – the most popular non-lender appraisals, Part 2

Turn times

Turn times are typically relatively long for date of death appraisals, except when the trustee must file a tax return or a 706 form for the date of death soon.

Estate appraisals are relatively easy to fit in with lender appraisals if you are busy. I quote turn times much longer than for lenders and seldom have any issues. Mine range from 2 to 6 weeks, depending on how busy I am. Large estates can take months.

If you are doing current value, such as for a sale to a tenant or relative, they usually want it sooner.

Value pressure

I rarely have value pressures, even with estates subject to the federal estate tax.

However, I prefer to find out if there are multiple beneficiaries and where they live so I can put in more detailed market information.

I make it very clear that my values are not high or low. They are the most probable values.

There are sometimes questions from beneficiaries about retrospective vs. current values if prices change. This typically happens when the current sales price differs from my retrospective value.

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U.S. Foreclosure Completions Increase Annually By 64 Percent In November 2022

December 8, 2022

Foreclosure Activity Remains Up 57 Percent from Last Year, and Foreclosure Starts Increase Annually by 98 Percent; But Both Measures Down from October 2022.


Highest foreclosure rates remain in Illinois, Delaware, and New Jersey

Greatest number of foreclosure starts still in California, Texas, and Florida

Excerpt: December 8, 2022 — ATTOM, a leading curator of real estate data nationwide for land and property data, today released its November 2022 U.S. Foreclosure Market Report, which shows there were a total of 30,677 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions – up 57 percent from a year ago, but down 5 percent from the prior month.

“We may be at or near a peak level of foreclosure activity for 2022,” said Rick Sharga, executive vice president of market intelligence at ATTOM. “While foreclosure starts and foreclosure completions both increased compared to last year’s artificially low levels, they declined from last month, and lenders often put a moratorium on foreclosures during the holiday season.”

To read more, click here

My comments: Most of us have been through at least one foreclosure market. Don’t miss changes in your market! Keep close track of local foreclosure data, increases in expired listings, few pending sales vs. number of listings, price drops, re-listings, etc.


How much have home prices gone down?

December 14, 2022

By Ryan Lundquist


Buyers went from FOMO to FOGS

First, here’s a clever way to describe some buyers right now. Buyers went from the Fear of Missing Out (FOMO) to the Fear of Getting Stuck (FOGS). This obviously doesn’t describe everyone because lots of buyers simply cannot afford the market, so stepping back isn’t just about fear. But this concept resonated with me since some buyers have been really concerned about buying at a higher price only to see prices go down later.

This concept came from David Osborn, and I made a meme out of it. And now let’s see what happens at the Fed meeting today. So many buyers are hungry for housing, but affordability has been the main roadblock. As I keep saying, we’ll get more buyers back as affordability improves. Bottom line.

Ryan’s analysis of May vs. Today in his market

How much do I weigh compared to one year ago? And how much do I weigh since the spring? Those could be two different answers, and that’s how real estate stats are working right now. Two very distinct numbers.

Last year vs. May 2022

When looking at the image below, do you see how there isn’t much change from one year ago? But there’s been a giant change from May. As I said last week, prices have dipped three times faster than the normal rate this year. But if we only focus on last year, price drops look modest.

Friends, I had this conversation at least a dozen times this past week when sharing year-over-year stats, and lots of smart people were thinking prices weren’t down that much. This is an easy mistake to make.

It’s key to get into the habit of looking at year-over-year stats AND recent stats. I think it’s been so long in real estate since we’ve thought about declining prices, so there is a learning curve to get back into the rhythm.

Unfortunately, some people will focus on year-over-year stats, and they’re going to walk away with an incomplete picture or even perpetuate a false narrative.

To read more plus read the many appraiser comments, click here

My comments: What is happening in your market? See what Ryan does in his market. He has lots of advice on what to watch, plus discussion in the comments. Don’t miss a change in your market. Make correct market conditions adjustments! I quit making line item adjustments on the appraisal forms a while ago, but I always make market conditions adjustments when needed. Don’t let Fannie come after you on a loan buy back!!


How Do You Wedge a Condo Into a Tiny Site? Work the Angles

The developer wanted to fit multiple units on a small, oddly shaped parcel of land in a neighborhood of traditional homes in British Columbia.

Excerpt: Vancouver architect D’Arcy Jones had never designed a multifamily project before, so when the opportunity to build a small condo came up, he was willing to tell a tiny fib to land the gig. The developers of the oddly shaped site in Victoria, British Columbia, thought it was too irregular to support much housing, even though it was zoned for it; they had their fingers crossed for four units, Jones says. So he told them he could fit five.

“It was like a piece of pizza,” he says, “a triangle that no one else wanted to buy.”

In the end, the architects beat even their own optimistic projections, delivering six family-sized modernist condos for this in-fill development…

To read the very interesting descriptions and comments, click here

My comments: Very interesting photos and images, similar to the one above. Discusses neighborhood opposition to multifamily, interesting layouts for the triangular units, parking, room layouts, and more topics.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 I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample go to Or call 510-865-8041, MTW 7 AM 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.


Mortgage applications increased 3.2 percent from one week earlier

Mortgage applications increased 3.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending December 9, 2022.

The Market Composite Index, a measure of mortgage loan application volume, increased 3.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.4 percent compared with the previous week. The Refinance Index increased 3 percent from the previous week and was 85 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 38 percent lower than the same week one year ago.

“Mortgage rates increased slightly after a month of declines, as financial markets reacted to mixed signals regarding inflation and the Federal Reserve’s next policy moves. The 30-year fixed rate inched to 6.42 percent, which is still close to the lowest rate in a month,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Overall applications increased, driven by increases in purchase and refinance activity. However, with rates more than three percentage points higher than a year ago, both purchase and refinance applications are still well behind last year’s pace.”

Added Kan, “The ongoing moderation in home-price growth, along with further declines in mortgage rates, may encourage more buyers to return to the market in the coming months.”

The refinance share of mortgage activity increased to 29.4 percent of total applications from 28.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.7 percent of total applications.

The FHA share of total applications decreased to 13.1 percent from 13.7 percent the week prior. The VA share of total applications increased to 11.5 percent from 11.4 percent the week prior. The USDA share of total applications remained unchanged at 0.6 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 6.42 percent from 6.41 percent, with points increasing to 0.64 from0.63 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200)increased to 6.14 percent from 6.08 percent, with points decreasing to 0.42 from 0.50 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.40 percent from 6.39 percent, with points increasing to 1.03 from 0.93 (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 increased to 5.92 percent from 5.84 percent, with points decreasing to 0.54 from 0.55 (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 5.58 percent from 5.59 percent, with points decreasing to 0.80 from 0.91 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

Please Note:

MBA Offices will be closed Monday, December 26, 2022 and will reopen on Tuesday, January 3, 2023.  Due to the holiday, the results for weeks ending December 23, 2022 and December 30, 2022 will both be released on January 4, 2023.

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

1826 Clement Ave. Suite 203 Alameda, CA 94501

Phone 510-865-8041


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