FHA handbook 4000.1 quarterly update
To keep up on what is happening in appraisal businesses, mortgage lending, USPAP, etc. , Plus humor and strange homes, sign up for my FREE weekly appraisal email newsletter, sent since June 1994. Go to Home on the right side of the menu at the top of this page or go to www.appraisaltoday.com
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Direct lender – average turn times by state in business days, a very wide range:
ALABAMA
|
10
|
MINNESOTA
|
9
|
||||
ARKANSAS
|
0
|
MISSOURI
|
17
|
||||
ARIZONA
|
16
|
MISSISSIPPI
|
10
|
||||
CALIFORNIA
|
10
|
NORTH CAROLINA
|
14
|
||||
COLORADO
|
24
|
NEW HAMPSHIRE
|
20
|
||||
CONNETICUT
|
9
|
NEW JERSEY
|
11
|
||||
DISTRICT OF COLUMBIA
|
4
|
NEW MEXICO
|
20
|
||||
FLORIDA
|
8
|
NEVADA
|
2
|
||||
GEORGIA
|
9
|
NEW YORK
|
16
|
||||
IDAHO
|
10
|
OHIO
|
17
|
||||
ILLINOIS
|
10
|
OREGON
|
31
|
||||
INDIANA
|
14
|
PENNSYLVANIA
|
11
|
||||
KANSAS
|
14
|
RHODE ISLAND
|
15
|
||||
KENTUCKY
|
13
|
SOUTH CAROLINA
|
12
|
||||
LOUISIANA
|
7
|
TENNESSEE
|
14
|
||||
MASSACHUSETTS
|
12
|
TEXAS
|
12
|
||||
MARYLAND
|
13
|
VIRGINIA
|
8
|
||||
MAINE
|
28
|
WASHINGTON
|
19
|
||||
MICHIGAN
|
13
|
WISCONSIN
|
12
|
||||
The Most Unusual Homes Available Right Now, for sale or for rent, From A Luxury Cave To A Giant Turtle
Excerpt:
Good investment or not, wacky homes sure are fun to look at and can be rewarding to owners in ways more profound than money (more on that below). So we went in search of some of the most interesting homes available today. We found a house shaped like an onion, an Irish castle and a home meant to look like a fishing reel.
My comment: Just For Fun!! I wanna rent one of the vacation rentals. The Turtle House in Egypt is only $54 to $96 per night!! And you thought some of the weirdo homes you appraised were strange… take a look at these! And, of course, Ace Appraiser Jonathan Miller is mentioned in the first paragraph ;>
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What is your current appraisal turn time (order receipt to submission)?
My comment: I wonder how many are over 2 weeks? 8 weeks?
WHAT DO YOU THINK? POST YOUR COMMENTS AT www.appraisaltodayblog.com !!
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Viginia Coalition of Appraiser Professionals (VaCap) Open Letter to AMCs
A few weeks ago, Virginia Coalition of Appraiser Professionals (VaCAP) sent out an open letter to the AMCs. This letter was republished by many coalitions, and appraiser groups across the country; liked and shared on Facebook and broadcast on several industry blogs. VaCAP received an overwhelmingly positive response from the letter. We even heard from several Realtors applauding our efforts! Activity is still ongoing with comments! Click here to read the letter and comments!
We heard you loud and clear…
The letter can now be signed by individual appraiser here on AppraisersBlogs. We will gather signatures and submit the signed letter to the FDIC, CFPB, Comptroller of the Currency and our Federal Reserve Board.
Note: To protect the appraiser identity from retaliation, only the initial of your last name and state will show on line. The copies sent to the FDIC, CFPB, Comptroller of the Currency and our Federal Reserve Board will have your full name.
Excerpt of a few points on the list:
- – The use of an AMC has decreased the income of the appraiser, thereby harming local economies.
- – The use of an AMC has increased the turn time for the delivery of the appraisal.
- – AMCs operate on a fast and cheap model which has deteriorated the quality of appraisals
- – AMCs have caused undue stress on the appraiser by demanding constant updates
- – AMCs hire unqualified employees that lack comprehension of the appraisal process.
My comment: I usually don’t put in links to negative blog posts, but this seems to hit all the AMC issues, plus has something you can do. AMCs have been around since the 1960s but were never like this before. It is definitely a Big Mess and bad for the consumer (higher appraisal fees, delays in getting loans, etc.) Of course, they are doing what their lender clients want, but their methods are not good. There are some AMCs that are okay. Some appraisers have found a few they work for. Note: There is an ad in the middle of the post.
http://appraisersblogs.com/appraisers-sign-vacap-amc-letter/
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In the October 2016 issue of Appraisal Today
Fees are going way up!! How to get higher appraisal fees during this boom time!! By Ann O’Rourke, MAI, SRA, PDQ and Doug Smith, SRA, AI-RRS . Lots and lots of practical tips.
Excerpt from the article:
How many appraisers are raising their fees?
I have been telling appraisers to raise their fees since early 2015. Below are two results of
appraisalport weekly polls.
Results from an April 2015 AppraisalPort weekly poll
Question: How long has it been since the last time you actually raised your fees?
- 1 year 17%
- 2-3 years 18%
- 4-6 years 18%
- 7+ years 26%
- I can’t remember – I normally just accept the fee my client offers. 21%
Back in April 2015 not many appraisers were raising their fees.
In the past year, have your standard fees for a typical non-complex assignment changed?
Results from Appraisalport September 2016 poll.
- Decreased 3
- Stayed about the same 42
- Increased by less than $50 27%
- Increased by less than $100 18%
- Increased by more than $100 11%
More appraisers are raising their fees in 9/16, but 45% have not still raised their fees! A few years ago I raised my non-lender fees to close to what borrowers pay. Why do appraisers keep working for low fees when they are so busy that they can’t take any more work? Or, they are not super busy, but want to get higher fees? Fear of never getting any more work. This is common to almost every business person, including myself. But it is not good when it keeps you from making more money, as it always does.
To read the full article with lots more data and practical tips for getting higher fees, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
$8.25 per month, $24.75 per quarter, $89 per year (Best Buy)
or $99 per year or $169 for two years
Subscribers get, FREE: past 18+ months of past newsletters
plus 4 Special Reports, plus 2 Appraiser Marketing Books!!
To purchase the paid Appraisal Today newsletter go to
www.appraisaltoday.com/products or call 800-839-0227.
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17 Things Appraisers Should Do Before Hiring an AMC Client
October 4th, 2016 9:54 AM
Here are two of them:
7. Google the AMC’s name and see what comes up. This might seem obvious, but some AMCs have been in the news for lawsuits related to unfavorable treatment of appraisers. You do not want to waste your time vetting an AMC that has a bad reputation. Even if no lawsuits come up, a quick Google search could result in a feel for the company and let you know if this is a company you want to work for. Remember that homeowners might think you work for this AMC when you show up to do the appraisal. Is this a company that you are okay with if homeowners get confused and think you work for them?
17. Check the AMC’s data protection policy and ask what steps have been taken to keep your private information safe. Also ask if the AMC has ever had any data breaches and if so, determine what systems have been put into place to ensure that data breaches do not happen again. Does the AMC have a policy that requires them to alert appraisers if they believe a data breach was possible?
Click here for the full Most Excellent List!!
www.aqualityappraisal.com.blog
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AMC Notes from Appraiserville by Jonathan Miller
Excerpts:
There was a CNBC article this week by Diana Olick that caused an uproar in the appraisal industry: ‘Massive’ shortage of appraisers causing home sales delays. Besides the incorrect inference of the title, the article was centered around Brian Coester, CEO of the Maryland-based CoesterVMS, currently one of the most controversial personalities in the appraisal management industry…
So I spoke with Diana Olick about the article this morning. I’ve known her for a long time and read all her stuff. She clearly did not realize what CoesterVMS represents to the appraisal industry but learned this from the outpouring of negative comments on the article by outraged appraisers. She understands now. How great is it that appraisers are getting out there and speaking their mind!
I told her that Coester is a notorious AMC in the middle of a big lawsuit that the entire appraisal industry is following. The shortage of appraisers is a myth being perpetuated by AMCS like Coester since their model only works if they pay appraisers a third to half the market rate for appraisal services.
My comment: I definitely think the current AMC model is broken, from the consumer, lender, appraisal and appraiser sides. I don’t really understand how it got so bad. I started writing in my paid newsletter about AMCs in the early 1990s. AMCs started in the were never like this before. Mostly they just paid lower fees. None had really low fees, scope creep, harassing and demeaning appraisers, etc.
To read more, Scroll down the page to Appraiserville
http://www.millersamuel.com/note/september-30-2016
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Miller was on a recent Voice of Appraisal radio interview with Phil Crawford.
Miller’s interview starts at -25:09 or 17:20 (download) 43:31 minutes total
http://www.voiceofappraisal.com/podcasts Episode 123
My comment: In last week’s email newsletter I said that the 2016 peak is almost up to the 2013 peak. In 2013 no one was complaining about high fees and turn times. In their discussion Miller said it was different because of CU/Scope Creep. He also said that business had been very slow between 2008 and 2012 and appraisers were glad for work. Appraiser attitudes about working for AMCs is much, much worse now. Good comments…Very few appraiser complaints about direct lenders and non-lender work.
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Revised FHA handbook
Thanks to Dave Towne for this info!
HUD/FHA recently updated and revised the 4000.1 Handbook…..actually on June 30, 2016………..but notice about this was sent out Friday, Sept. 30.
http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/handbook_4000-1
When the page opens, scroll down the page and you’ll see two entries on the left regarding the Handbook. If you open the PDF link, and let it load…it will actually show you the changes made to the appraisal section (and others).
Note….the handbook is 1000+ pages, but only about 40 or so apply to appraisals.
Note that the revised handbook has ‘moved’ the Appraiser and Property Requirements section to II D, from its former position in B.
Buried in the revision is new info on how to account for specific named ‘appliances’ in a home you are appraising. See II D 3e.
It’s going to take someone with more time (than I have now) and expertise to determine what exactly HUD changed in the reporting requirements about “appliances that remain and contribute to value.” One needs to read the former 4000.1 Handbook and compare that to this revised edition to fully understand the implications of what HUD wants reported.
You will want to compare the attic observation requirement also. Revision 4000.1 has this in II D 3k.
Crawl space observation is in II D 3m.
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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 https://www.mba.org
Note: I publish a graph of this data every month in my printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to www.appraisaltoday.com/productsor send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.
WASHINGTON, D.C. (October 5, 2016)
Mortgage applications increased 2.9 percent from one week earlier
according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 30, 2016.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 3 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week. The seasonally adjusted Purchase Index decreased 0.1 percent from one week earlier. The unadjusted Purchase Index decreased 0.2 percent compared with the previous week and was 14 percent lower than the same week one year ago.
The refinance share of mortgage activity increased to 63.8 percent of total applications from 62.7 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 4.5 percent of total applications.
The FHA share of total applications decreased to 10.0 percent from 10.2 percent the week prior. The VA share of total applications decreased to 11.4 percent from 11.9 percent the week prior. The USDA share of total applications increased to 0.7 percent from 0.6 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 3.62 percent, the lowest level since July 2016, from 3.66 percent, with points decreasing to 0.32 from 0.33 (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 $417,000) decreased to 3.60 percent from 3.64 percent, with points decreasing to 0.25 from 0.28 (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 3.50 percent from 3.52 percent, with points decreasing to 0.16 from 0.21 (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 2.93 percent from 2.95 percent, with points decreasing to 0.32 from 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 remained unchanged at 2.92 percent, with points increasing to 0.44 from 0.40 (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.
The Revolutionary Concept of Standard Sizes Only Dates to the 1920s
Nearly everything in your home is a certain size, thanks to German architect Ernst Neufert.
Excerpt: Almost every kitchen counter in the United States is 36 inches tall. And 25 inches deep. Eighteen inches above the counters are the cabinets, which are 16 inches deep.
Where do these sizes and dimensions come from? Have they always been so exact?
Building standards, as these numbers and rules are often known, are everywhere, helping shape everything from your kitchen cabinets and the sidewalk in front of your house to the layout of your favorite restaurant. Despite their prevalence, building standards really only came into being in the last century. A major turning point in their wild proliferation arrived in the 1920s, when the German government made the then-radical decision to standardize the size of office paper.
My comment: Fascinating!! Lots more info and images at the link below.
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Do you have questions about using Collateral Underwriter® (CU™)? Register to attend the upcomingAsk the Expert webinar on September 27, 2 p.m. to 3 p.m. ET. Additional webinars and eLearning courses are available on the CU web page.
Have you heard about CU’s easier-to-use design and layout coming later this year? Check out the preview. You can also view the new CU infographic for an overview of CU’s powerful features. CU gives you the feedback you need, when you need it, with a CU risk score, alerts, and messages provided real-time in the Uniform Collateral Data Portal® (UCDP®). For all the latest news and resources, visit the CU web page.
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Scheer Motion to Dismiss Coester vs Scheer Lawsuit
Excerpt: More CVMS Fraud and Coester’s Fraudulent Activities Revealed
Robert Scheer, former Coester Senior VP, has filed a motion to dismiss Coester vs. Scheer lawsuit. There are also whispers in the appraisal community that Brian Coester’s motion to dismiss the lawsuit against him was denied. Looks like Scheer vs. Coester lawsuit is going to trial. Scheer continues to reveal more dirt against Coester while appraisers continue to flood social media with comments, and sometimes with humorous reactions…
This article includes the motion to dismiss.
http://appraisersblogs.com/cvms-fraud-coester–scheer
Previous post on this topic: Coester Allegedly Engaged in Fraud Sued by Former Senior VP
http://appraisersblogs.com/Coester-VMS-lawsuit-fraud-forgery
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Dollhouse Real-Estate: Inside the Elite Market for Miniature Homes
Priced as high as hundreds of thousands of dollars, these elaborate dollhouses count sex therapist Ruth Westheimer and a member of Qatar’s royal family as collectors
Excerpt: This Victorian-style home features four bedrooms, one bathroom and ornate period details like a clawfoot bathtub, crystal chandeliers and mahogany fireplaces. It is currently on the market, fully furnished, for $149,000. Since the home is roughly 18 square feet, the price comes to about $8,278 per square foot.
My comment: Thanks to Jonathan Miller for this Fun Link!!
Doll houses will never be the same for me ;>
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Coming in the October 2016 issue of Appraisal Today
How to get higher appraisal fees !!!
Topics include:
- Why AMC fees started going up last year.
- Comparison of AMCs, direct lenders and non-lender fees. Why they are very different.
- How to find out what AMCs are say they are paying and what appraisers are really getting.
- Lots of fee negotiating tips
Not just a lot of ranting. Practical advice on how to successfully make more money during this Boom that will not last forever.
To read the full article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
$8.25 per month, $24.75 per quarter, $89 per year (Best Buy)
or $99 per year or $169 for two years
Subscribers get, FREE: past 18+ months of past newsletters plus 4 Special Reports, plus 2 Appraiser Marketing Books!!
To purchase the paid Appraisal Today newsletter go to
www.appraisaltoday.com/productsor call 800-839-0227.
If you are a paid subscriber and did not get the September 2016 issue, emailed September 1, 2016, 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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APPRAISERS IN THE NEWS. THE ARTICLES BELOW ARE ABOUT FEES, TURN TIMES, APPRAISER SHORTAGE, ETC. THEY WERE WRITTEN FOR LENDERS, REAL ESTATE AGENTS, HOME OWNERS, AND THE GENERAL PUBLIC. All allow comments, which can be very interesting!!
5 things to consider about higher appraisal fees and longer turn-times By Ryan Lundquist. Written for real estate agents and home owners
Excerpt: 4) Not Getting All the Money: A loan officer I spoke with was frustrated that his Borrowers were paying $550 for conventional appraisals and $750 for jumbo appraisals – and still experiencing longer turn-times. When he told me the Appraisal Management Company (AMC) he uses though, that’s where the problem comes in. This AMC regularly pays appraisers $350, which means they’re pocketing 40% of the fee the Borrower thinks is going to the appraiser. A few days ago on Facebook there was an appraiser who had an offer from an AMC to appraise a property for $850, but the AMC was charging the Borrower $1,385. Let’s remember appraisers are supposed to be paid “customary and reasonable” fees under Dodd-Frank, but a reasonable fee is what the appraiser gets – NOT what the Borrower pays.
My comments: Well written – for real estate agents and home owners, but has good explanations for everyone. (Ryan’s blog is primarily marketing for his appraisal business.) This article also discusses the decline in the number of appraisers in California, with data, but is relevant for many other states.
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Appraiser Shortage? By Greg Stephens, SRA, MetroWest AMC
Reprinted from a June 2016 mortgage magazine. Written for lenders.
Excerpt: A topic very relevant to mortgage professionals has been receiving increasing attention lately-the question whether there is or is not a shortage of appraisers? Regulators, as well as market participants, have been weighing in, and depending upon who you talk to, the answers vary. The problem so far is that most of the discussion has been anecdotal.
What also needs to be included in stakeholder discussions on the topic is the status of future appraisers in the pipeline to replace the aging population of practicing appraisers.
To answer the question-not only whether there is a current shortage, but also if there is the potential for a shortage either in the near future (three to five years) or perhaps even longer, I conducted some in-depth research to glean as much factual information as possible.
My comments: This article has some good data on declines in number of trainees, problems with ASC data,lenders not allowing trainees to sign on their own, etc. Written for mortgage lender publication. Of course, it does not discuss low fees, scope creep, and treating appraisers “poorly” as a reason for the shortage of appraisers willing to work for many, or all, AMCs.
http://www.nationalmortgageprofessional.com/news/60306/appraisal-industry-update
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Need an appraisal right away? It may cost more than you’d expect. By Ken Harney. Written for the general public. Syndicated in national newspapers.
Excerpt: The problem is part work overload, part resentment over fees. In many markets, diminishing numbers of experienced appraisers are available – and willing – to handle requests for their work on tight timetables and at fees sometimes lower than they earned a decade or more ago.
The net result: The system is getting gummed up. …. A recent survey of agents by the National Association of Realtors found that appraisal problems were connected with 27 percent of delayed closings, up from 16 percent earlier this year.
In some cases, panicked lenders and management companies are offering appraisers fat bonuses and “rush fees” to meet deadlines. The extra charges can range from $200 to $1,000 or more, turning $500 appraisals into $1,200 or $1,500 expenses, which typically get paid by home buyers.
My comment: Harney has been a nationally syndicated real estate columnist for a long time.
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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 https://www.mba.org
Note: I publish a graph of this data every month in my printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to www.appraisaltoday.com/productsor send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.
WASHINGTON, D.C. (September 21, 2016)
Mortgage applications decreased 7.3 percent from one week earlier,
according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 16, 2016. The prior week’s results included an adjustment for the Labor Day holiday
The Market Composite Index, a measure of mortgage loan application volume, decreased 7.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 15 percent compared with the previous week. The Refinance Index decreased 8 percent from the previous week to the lowest level since June 2016. The seasonally adjusted Purchase Index decreased 7 percent from one week earlier. The unadjusted Purchase Index increased 15 percent compared with the previous week and was 3 percent higher than the same week one year ago.
The refinance share of mortgage activity increased to 63.1 percent of total applications from 62.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 4.4 percent of total applications.
The FHA share of total applications increased to 10.2 percent from 9.6 percent the week prior. The VA share of total applications decreased to 11.6 percent from 12.0 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 ($417,000 or less) increased to its highest level since June 2016, 3.70 percent, from 3.67 percent, with points increasing to 0.38 from 0.36 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 3.69 percent from 3.64 percent, with points decreasing to 0.29 from 0.36 (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 3.56 percent from 3.50 percent, with points decreasing to 0.23 from 0.27 (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 2.99 percent from 2.97 percent, with points increasing to 0.35 from 0.34 (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 increased to 2.96 percent from 2.87 percent, with points
decreasing to 0.26 from 0.37 (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.
A Map of the Last Remaining Flying Saucer Homes
All the 1960s Futuro Houses left in the world.
Just For Fun!! Take a break from writing up those darn appraisal reports ;>
Excerpt: The Futuro House, in all its space age retro splendor, is like a physical manifestation of 1960s optimism. Shaped like the Hollywood idea of a flying saucer, the Futuro is a plastic, prefabricated, portable vacation home built to easily adapt to any climate or terrain, from mountain slopes to the seaside. After enjoying a heyday in the late ’60s and early ’70s, the remaining Futuros are now scattered across all parts of the globe, from the Australian beaches to the mountains of Russia, like secluded relics of midcentury technoutopianism.
Very interesting!!
http://www.atlasobscura.com/articles/a-map-of-the-last-remaining-flying-saucer-homes
My comment: I love atlasobscura.com. The strange homes and buildings I include in these emails are just the tip of the iceberg!!!!
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What is your typical rush fee?
www.appraisalport.com poll.
My comment: Rush fees are another way to make more money during this boom time, to save for the downturn when AMC fees will drop.
The most critical appraisals are those for purchases, which can require rush fees to get appraisers to drop their regular refi business and do them.
I am hearing about widely varying AMC fee increases from around the country, depending on the local market supply of appraisers willing to work for AMCs I guess. Savvy AMC appraisers reply to low bids with an increased fee. After a few weeks, sometimes their fee is accepted. Local appraisers I know only work for a very few select AMCs, if any. But, when business slows way down, they take more AMC work. I also hear from appraisers in the same market with widely varying fees that they will accept.
What do I do? Rush fees stress me out too much as I am very backed up. I just put new appraisal requests in my queue, which is typically around 60 days. Sometimes I will do one faster if it is a special circumstance and/or a referral from a local real estate agent, but I don’t require a rush fee. When I used to do appraisals for purchases, I always gave them priority but never charged a rush fee. I am definitely in the minority!!
What do you think? Post your comments at https://wp.me/p7jsxG-Cl !!!
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The Most Expensive House In The World Could Sell For $1.1 Billion
Just For Fun!! Take a break from writing up those darn appraisal reports ;>
Excerpt: What can justify a $1.1 billion price tag for a house?
Before searching for the features behind the number, let’s clarify that in this case, “the house” is rather a large, opulent mansion on the French Côte d’Azur, set in a “small” privileged refuge between Nice and Monaco frequently described as the ‘billionaires’ playground.’
First, there’s the house itself, with the understated name Villa Les Cèdres-The Cedars-at the center of Saint-Jean-Cap-Ferrat, known in French as a “presqu’île,” or “almost island.”
The description of the magnificent property in the French press includes 10 bedrooms, a ballroom, concierge, a chapel, 50-meter swimming pool dug into the rocks, a winter garden and stables for 30 horses.
My comment: I could take a few months (or more) to do an appraisal for a trip to France to appraise this property… Or maybe just an open house tour ;>
Very interesting!!
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Beware of unknown desperate AMCs sending email solicitations
An appraiser I know, who only works for one AMC, received an email request from an AMC he had never heard of. He replied politely that he was not interested. He was added to their approved list and bombarded with requests for appraisals every day. It was a lot of hassle to get his name removed.
I seldom get any AMC appraisal requests by email or phone, or request to join their panel. I must be on a Do Not Call or Email List ;> I have been replying to emails saying I have never worked for an AMC. They are really getting desperate!! Now, I am thinking about not even replying.
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In the June 2016 issue of Appraisal Today
FHA attic inspection requirement
Excerpt: Inspection Tips – Insulation and attic access by Doug Smith, SRA, AI-RRS
When blown in insulation is added, the installer will often add an extension or dam to the scuttle that makes it difficult to fully observe the full attic.
Formerly, attics had walkways which when blown in insulation is applied, these walkways were covered with insulation. If the scuttle is in a closet and closet shelves make it difficult to fully access the attic, the difficulty with attic must be reported and a photograph taken to demonstrate the difficulty with attic access.
However, if the access is blocked by personal possessions, it may be practical to enlist the help of the homeowner to make the attic or scuttle accessible. In the instant case of the underwriter stating that a full inspection is required, the underwriter is incorrect.
The appraiser must document why a full inspection was not performed when there is not an accessible attic. Suggested language might include: “A full attic inspection was not
performed as the subject property does not have a readily accessible attic and only has scuttle access.” Along with a photo of what can be seen from the scuttle, the appraiser might add that the appraiser completed a head and shoulders inspection of the attic.
Remember to check the block on page one of the form that the attic is accessed by a scuttle. If the property has a full attic, note if a full inspection was performed and comment how access was gained either by stairway or drop stair.
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Selling a $5 Million, Seven-Story Basket Is No Picnic
Its size, location, and fundamental basket-ness make it tough to sell, even at a steep discount
Thanks (again) to Jonathan Miller at http://www.millersamuel.com/housing-notes/
Excerpts: “You might see it three or four miles off before you come around the bend, and then you say, ‘That is a basket. That is unquestionably a basket,'” said Tom Rochon.
It is a basket, or rather, a seven-story office building shaped like one-a massive facsimile of the signature picnic basket made by the company once headquartered there. Some 40 miles outside Columbus, Ohio, the basket building, as it’s locally known, is one of the area’s grandest attractions, inviting quirky selfie-seekers, architecture nerds, and, of course, basket enthusiasts.
When the property – slightly larger than another Ohio landmark, Cleveland’s Rock and Roll Hall of Fame-was listed 18 months ago, the asking price was $7.5 million. Now it’s on the market for $5 million, or about $28 a square foot, about half of what traditionally shaped office buildings in the area usually sell for… commercial property in the area typically ranges from $50 to $80 a square foot.
The basket was built for about $32 million and finished in 1997.
My comment: I regularly write about weird properties in my weekly emails, including the Basket House a few years ago. Finally we find out what it is (not) worth. Definitely an Appraisal Challenge!!
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Status Quo Bias: ‘Linear” Thinking in the Real Estate Industry
by Jonathan Miller
Excerpt: When we look at forecasting, planning, trending or anything that includes a look out over the future, I find the real estate industry (i.e. appraisers, real estate agents & brokers) generally thinks along linear lines.
For example:
When housing prices rise…they will rise forever.
When housing prices fall…they will fall forever.
When sales activity rises…they will rise for ever.
When inventory falls…it will fall forever.
When rental prices rise…they will rise forever.
…and so on.
Where does this status quo bias come from?
Click here for some more interesting comments..
http://www.millersamuel.com/status-quo-bias-linear-thinking-in-the-real-estate-industry/
My comment: Of course, I completely agree. It is very important if you work in a market like mine, where residential prices seem to go from stable to increasing and back overnight. I have no idea why. I go on the broker open house tour every week and see what agents are saying. For example, only 1 or 2 offers vs. 5-6 and longer days on market
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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 https://www.mba.org
Note: I publish a graph of this data every month in my printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to www.appraisaltoday.com/products or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.
WASHINGTON, D.C. (September 14, 2016
Mortgage applications increased 4.2 percent from one week earlier,
according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 9, 2016. This week’s results included an adjustment for the Labor Day holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 4.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 17 percent compared with the previous week. The Refinance Index increased 2 percent from the previous week. The seasonally adjusted Purchase Index increased 9 percent from one week earlier. The unadjusted Purchase Index decreased 15 percent compared with the previous week and was 8 percent higher than the same week one year ago.
The refinance share of mortgage activity decreased to 62.9 percent of total applications from 64.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 4.6 percent of total applications.
The FHA share of total applications increased to 9.6 percent from 9.5 percent the week prior. The VA share of total applications increased to 12.0 percent from 11.9 percent the week prior. The USDA share of total applications increased to 0.7 percent from 0.6 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 3.67 percent from 3.68 percent, with points decreasing to 0.36 from 0.37 (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 $417,000) decreased to 3.64 percent from 3.66 percent, with points increasing to 0.36 from 0.30 (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 3.50 percent from 3.52 percent, with points decreasing to 0.27 from 0.35 (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 increased to 2.97 percent from 2.96 percent, with points unchanged at 0.34 (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 remained unchanged at 2.87 percent, with points increasing to 0.37 from 0.30 (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.
Poll: In the past year, have your standard fees for a typical non-complex assignment?


I don’t think that residential fees have ever gone up this quickly, both for non-AMCs and some AMCs. Keeping up on residential fees in my local market is tough. Of course, the “flip side” is that fees will go down when the boom is over, especially AMC fees.
Some consider VA fees as C&R, but they are increasing also in some areas.
Although some AMCs keep looking for appraisers who will do a quick turn time for a low fee, it is becoming more and more difficult as fewer appraisers are willing to do this.
I recently attended a CE class nearby that focused on AMCs, who said that there were big issues with turn times and fees from their lender clients. The September issue of the paid Appraisal Today will have an article on what was discussed at the class, “AMCs tell All to residential appraisers”.
Why were fees relatively stable for decades? Prior to HVCC, in my market, fees would gradually go up over time, increasing $25 to $50 when demand was very strong. Most fees were in a fairly narrow price range. We made money on the easy tract homes and lost money on the “tough ones”.
Why have fees gone up so dramatically? Appraisers are reporting turning down (or not responding to) 20-30 or more requests a day from AMCs. Residential appraisers had never competed much on lender fees prior to HVCC. I do commercial appraisals, where bidding has always been done. Fee ranges of $1,500 to $3,000 for the same property have never been unusual. The time and cost of bidding is included in the fee. Most AMCs have been using bidding as there was an oversupply of appraisers. When business is slow, they offer lower fees. Now that business is strong, they pay higher fees. Of course, there are still some appraisers doing them for low fees.
In some areas, AMCs are desperate for any appraisers at any fees to accept appraisals, especially for purchases. Particularly tough are markets where an AMC has one, or a few appraisers. NAR warned real estate agents not to try for 30 day closes.
How do AMCs handle the high fees? This depends on their lender agreements. TRID is a factor as loan officers usually set the fees, which are very difficult to change. Some lenders will allow AMCs to charge more for a specific appraisal. If not, the AMC has to pay the additional cost.
What about turn time? If a loan needs to close quickly, such as a purchase loan, some lenders are offering very high fees. Be careful taking them – be sure to see how difficult the appraisal will be before accepting as turn time is very critical. Also, you will doing less work for a regular “A list” clients.
Statistics humor
Three statisticians go hunting. They see a deer and the first one
shoots, hitting three feet left of the deer. The second one shoots, hitting three feet right of the deer. The third one leaps up in joy, yelling, “we got him!”
Thanks to Scott Jura for this great joke! Posted on a yahoo appraiser discussion group.
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Ex-appraiser sentenced to 6 years for mortgage fraud
Excerpt: A Pittsburgh federal jury convicted Jason Moreno, 33, on five counts of wire fraud and two counts of conspiracy in September 2013.
A former appraiser, Moreno overstated housing values and glossed over problems such as a den of black snakes in one house’s basement so that others in the scheme could obtain loans for more than the properties were worth.
U.S. District Judge Nora Barry Fischer resentenced Moreno on Monday to six years in prison and three years of probation.
http://triblive.com/news/adminpage/10811871-74/moreno-court-sentenced
Court documents from 1/16. Lots of very interesting details:
http://www2.ca3.uscourts.gov/opinarch/141568p.pdf
America’s First Medal at the Nazi Olympics Was For…Town Planning
Excerpt: Yes, from 1928 until 1948, town planning was an actual Olympic sport.
Town planning fell under an “architectural design” category at the Olympic art competition. The field that year was dominated by German entries. Yet the first U.S. medal of the Olympics went to Lay, a New York architect, for his ambitious blueprint to modernize Marine Park in Brooklyn.
http://www.atlasobscura.com/articles/americas-first-medal-at-the-nazi-olympics-was-fortown-planning
My comment: I love these Obscure Olympic Facts ;>
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Photo blurring gone waay overboard!!
Excerpt: At issue was the ubiquitous “client requirement” involving digital masking of people from images. While lenders and AMCs wave the Fair Housing penalty flag in order to assure compliance; there is NO such law. Never has been.
Lenders need to re-examine the reason for all of these pointless and invasive interior shots. They add nothing meaningful to the file. Nobody is laying out mortgages for Beanie Baby collections and bad drapes. So why are appraisers wasting megapixels on decorating images?
AMCs are on notice to cease demanding and insisting that appraisers do digital staging. That is clearly in violation of Illinois law.
Click here to read the full article plus the comments, of course…
http://appraisersblogs.com/digital-staging-amc-fair-housing-myth
My comment: Blurring interior pictures on walls, personal objects, etc. seems very excessive. Don’t know about rooms with strange devices and chains hanging from walls and ceilings, etc ;> Maybe appraisers will only be able to appraise vacant homes with nothing in them without getting requests for blurring. This applies only to AMCs doing business in Illinois, but maybe the AMCs will quit doing it in other states.
CLARIFICATION:
Until I wrote this post, I had been saying that AMC low fees and hassles were the main cause of the current appraiser shortage. Many appraisers won’t work for AMCs. Others left the profession because they would not work for AMCs.
I was wrong. The major factor is that trainees cannot sign on their own until certified. There is no other way to manage the huge ups and downs in volume of lender appraising. Prior to HVCC, this had been done for decades.
If this cannot be fixed, lenders will try to get their regulators to require fewer appraisals by using AVMs, BPOs, etc. They have always wanted this. Their reason now: too few appraisers causing purchases to be delayed.
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The residential lender appraisal system is broken.
The problem is NOT primarily low fees, licensing requirements, college degree, aging appraiser population, reluctance to hire “competitors”, etc.
The Problem: for the first time, there is no way to bring in trainees during boom times to sign on their own.
Since the 1970s, when Freddie and Fannie started and refis accelerated, lender volume had huge ups and downs, depending on interest rates. Lenders hired armies of trainees and laid them off when business slowed down. During the last big boom prior to the mortgage meltdown, fee appraisers hired the trainees and let them go. Now, very few appraisers are hiring trainees, except friends and relatives.
Lots of complaints now about the appraiser shortage. The Appraisal Foundation is considering lowering licensing requirements for certified appraisers. But, this will take years to change.
If lenders accept licensed appraisers, who do not need a college degree but need 150 hours of college classes, this will really help. A minimum of 12 months and 2000 hours of experience is required. The certified appraiser requirements will not have to be reduced. Certified res is 2.5 years of experience.
The AQB experience requirements are the minimum. I am in California, which has the AQB requirement: “Personally inspect the property with the Trainee until the supervisor determines the Trainee is competent to make unsupervised inspections, in accordance with the Competency Rule of USPAP for the type of property being appraised.” Some states have gone way beyond this, requiring the supervisor to inspect the subject with the trainee for the two years of experience. e supervision.
Lenders who want to switch from conventional and FHA will not be able to use licensed or trainees, of course. But, this is much, much better than weeks of delays getting appraisals, especially for purchases.
AQB requirements
Residential (AL) | 150 hours, covering specific modules including the 15-hour National USPAP Course (or its equivalent as determined by the AQB); and 30 semester units of college-level education, OR an Associate’s degree or higher (in any field). | 2,000 hours and encompassing no less than 12 months of acceptable appraisal experience. | Any non-complex 1-4 family property with a transaction value up to $1 million; and non-residential property with a transaction value up to $250,000 |
Certified Residential (AR) | 200 hours, covering specific modules, including the 15-hour National USPAP Course; and a Bachelor’s degree or higher. | 2,500 hours and encompassing no less than 2.5 years (30 months) of acceptable appraisal experience. | Any 1-4 family property without regard to transaction value or complexity; and non-residential property with a transaction value up to $250,000. |
Of course, for existing appraisers, this is a boom time with no new competitors entering the business. Fees are increasing dramatically and have increased this much in the past.