Generally speaking, how accurate do you find MLS data in your area?

Take this week’s poll (week ending 4-15-16) : “Now that we have been living for some time with all the new rules governing residential appraisal, do you still enjoy doing the actual appraisal work?” Go to www.appraisalport.com and vote!!
Go to www.appraisaltoday.com/blog to post your comments and read other appraisers’ comments.
My comments: I have no idea why so many people think that MLS data is correct!! Of course, it does vary a lot among MLSs. In my area it is “reasonably accurate”, except public records data is often used (and the source disclosed). For example, on the weekly open house tour last week, an agent had 2 bedrooms in the listing, because “that is what public records says”. The second bedroom was tandem with another bedroom and very small. We all know how (inaccurate) public records are. Somehow, everyone, including some appraisers, think it is accurate. Or, worse, try to make their appraisals match public  records to avoid callbacks.

4-7-16 Newz .Verifying sales .Big data .Weird bathrooms

8 Bizarre Bathrooms from Around the World

“From pop-up toilets in city streets to a bathroom surrounded entirely by an aquarium, these public and private bathrooms are beyond bizarre-and you need to see them!”

Take a break from appraising and check these out. Definitely Weird!!

http://blog.rismedia.com/2016/keepin-it-weird-8-bizarre-bathrooms

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Recent acquisitions of appraisal and title companies

Another great commentary from Dave Towne. Thanks again, Dave!!

From the article in Housingwire.com:

First American Mortgage Solutions, a subsidiary of First American Financial Corporation, acquired Forsythe Appraisals, supplementing its existing valuation capabilities.

Forsythe Appraisals is one of the largest independent residential appraisal company in the United States and offers real estate valuation solutions with nationwide coverage.

Under the acquisition, Forsythe’s management team, including President and CEO John Forsythe, Senior Director of Customer Development Tim Forsythe and Chief Appraiser Alan Hummel, will continue to lead those operations.

http://www.housingwire.com/articles/36672-first-american-mortgage-snaps-up-valuation-veteran-forsythe-appraisals

Read more!!

3-17-16 Newz .Pulling permits .Fannie FAQs .Refi revival

Appraisal and Property Related Frequently Asked Questions (FAQs)

February 12, 2016

This FAQ document provides responses to common questions related to Fannie Mae’s property eligibility and appraisal policies. Following the FAQs, the Attachment on page 10 provides Guidelines for Using Market Conditions Addendum to the Appraisal Report (Form 1004MC).

https://www.fanniemae.com/content/faq/appraisal-property-report-faqs.pdf   

My comments: This document does not have a lot of new material, but it is always good to read this so you can cut and paste some of Fannie’s comments into your reports as an explanation. In this month’s paid Appraisal Today I had two articles on the 1004mc form:

1004MC – the good, the bad, and what Fannie says

Statistical errors in the 1004MC by George Dell, MAI, SRA – He has been fighting with Fannie since the form was first required in April 2009

 More articles are coming soon in the paid Appraisal Today on how to handle the issues.

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Tiny ‘Harry Potter-looking’ homes under construction in North Texas

Excerpt:

Builder Rudy Rivas’ newest house would fit inside the master bedroom of the custom homes he constructs in North Texas.

The average new home being built in America is more than 2,700 square feet – the biggest ever.

So why’s a Dallas custom builder starting a 180-square-foot house?

Read more!!

3-10-15 Newz – Pulling permits, Fannie FAQs, Refi revival etc.

Appraisal and Property Related Frequently Asked Questions (FAQs)

February 12, 2016

This FAQ document provides responses to common questions related to Fannie Mae’s property eligibility and appraisal policies. Following the FAQs, the Attachment on page 10 provides Guidelines for Using Market Conditions Addendum to the Appraisal Report (Form 1004MC).

https://www.fanniemae.com/content/faq/appraisal-property-report-faqs.pdf

My comments: This document does not have a lot of new material, but it is always good to read this so you can cut and paste some of Fannie’s comments into your reports as an explanation. In this month’s paid Appraisal Today I had two articles on the 1004mc form:

1004MC – the good, the bad, and what Fannie says

Statistical errors in the 1004MC by George Dell, MAI, SRA – He has been fighting with Fannie since the form was first required in April 2009

More articles are coming soon in the paid Appraisal Today on how to handle the issues.

Read more!!

Newz 3-3-15 Abandoned places, Late appraisal, Cost vs value, Fees

Spam blockers are going wild!!! I have made some changes in subject line and some changes in newsletter content so more subscribers will get this newsletter. I can’t even mention some of the changes as using the words may send this email to spam!!!
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17 abandoned places around the world
Take a break from your appraisals with these Interesting Links!!
 
Here are a few:
1.  House of the Bulgarian Communist Party – Mount Buzludzha, Bulgaria
9. Michigan Central Station – Detroit, Michigan, United States
10. Sarajevo Olympic Bobsleigh and Luge Track – Sarajevo, Bosnia and Herzegovina
Good for taking an appraisal break!!
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Read more!!

NEWZ// 2-4-16 – Adjustments-Unwanted mansions-Why homeowners don’t refi-Loan buybacks

 5 Reasons Homeowners are not Taking Advantage of Refi Opportunities

Excerpts:

Historically low mortgage rates have been circling the housing market for several years now. Low mortgage rates present opportunities for homeowners to refinance their homes, but recent data and analysis shows that they are not taking advantage of billions of dollars in savings.

Although the number of refinancers may appear to be large, it is actually down from over 7 million in April 2015. Black Knight reports that interest rates were under 3.7 percent during this time, and the 20-year rate was 3.96.

Black Knight Data & Analytics SVP Ben Graboske explained, “This population is diminishing, and as mortgage interest rates rise, it will only continue to shrink further.”

Here are the five:

Lower credit scores and income.

Hassle and upfront expense.

Not enough equity.

Inconsistent job history.

Lack of assets.  

Lots more info plus a link to the original study.

http://www.themreport.com/news/data/01-25-2016/5-reasons-homeowners-are-not-taking-advantage-of-refi-opportunities

My comment: interesting analysis plus a link to the nerdwallet full analysis. I have always wondered why so few people are not doing refis with rates still at historic lows.

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 CU Quick Guide Videos Now AvailableNew short videos (~4 min) show how to easily use the Collateral Underwriter® (CU™) web application to research common messages. Watch the Quick Guide Intro to the Comp Selection Message to see how to use CU to review appraisals with a material difference between the appraiser-provided and CU model-selected comparable sale rankings. The Quick Guide to Data Discrepancy Messages shows how to quickly view other appraiser observations when there is a discrepancy in reported data (either from what the appraiser previously reported or from what other appraisers have reported.) Want to learn how other lenders have leveraged CU? Review this new Housing Industry Forum article which details how lenders that maximize the use of CU have been able to make the underwriting process more efficient while improving appraisal quality and reducing appraisal-related loan defects.Additional CU live webinar dates are also now available:

CU User Interface Basic Training: Feb 10, 2016 from 2 – 3:30 p.m. ET

CU User Interface Advanced Training: Feb. 18, 2016 from 2 – 3:30 p.m. ET

Maximize your Appraisal Review Efficiency and Effectiveness with CU: Feb. 24, 2016 from 2 – 3 p.m. ET

For more information on CU visit the CU web page. 

My comment: see how CU works, from the lender side. 

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America’s Most Unwanted: The Neverland Ranch and Other Unsold $100 Million Mega-Mansions

Excerpt:

Michael Jackson’s $100 million Neverland-formally known as Sycamore Valley Ranch-is still stuck on the block.

Listed last May (sans the King of Pop’s amusement park), the 2,698-acre compound in Los Olivos showcases a 12,598-square-foot, French Normandy-style main house with six bedrooms and nine baths. Other structures include three separate guesthouses, a 5,500-square-foot movie theater with a stage, numerous barns, animal shelter facilities, and a maintenance shop.

Check them all out at:

http://www.forbes.com/sites/kristintablang/2016/01/26/100-million-mega-mansions-for-sale-neverland-ranch-jeff-greene-rancho-san-carlos-palazzo-di-amore-le-palais-royal

My comment: if they ever do sell… very, very long exposure times!

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Adjustments – “Support” vs. “Proof, what should you do?

New in the FEBRUARY 2016 issue of the paid Appraisal Today

Adjustments Part 1 – Are you making too many adjustments? Lots of ideas, research, etc.

– Support vs. proof for adjustments by Bob Keith. A very good explanation of Scope Creep on adjustments. He is the former Executive Director 

of the Oregon State Appraisal Board and is a consultant for appraisers with state board complaints

Identifying Residential Architectural Styles by Mark Nadeau,SRA, Book review. Read my review to decide if you want to buy the book.                        

Two good, practical residential books, with very good tips on adjustments  Book reviews. 

The Dictionary of Real Estate Appraisal, 6th Edition – Read my review to decide if you want to buy this book. 

Cancel at any time. For any reason!!

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or $99 per year or $169 for two years (no credit card required) 

Subscribers get, FREE: past 18+ months of newsletters plus 4 Special Reports!!

If you are a paid subscriber and did not get the January 2016 issue, emailed Jan. 4, 2016, please send an email to info@appraisaltoday.com  requesting it 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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Fannie, Freddie Unveil New Appeals Process for Loan Repurchases

Excerpt:

Fannie Mae and Freddie Mac unveiled an appeals process Tuesday that will allow an independent arbitrator to resolve disputes between lenders and the government-sponsored enterprises over loan repurchase demands.

The new independent dispute resolution process, which was approved by the Federal Housing Finance Agency and endorsed by the Mortgage Bankers Association, is an effort to provide lenders more certainty that they won’t later face costly repurchase requests if a loan goes bad.

http://www.nationalmortgagenews.com/news/secondary/fannie-freddie-unveil-new-appeals-process-for-loan-repurchases-1071121-1.html

My comment: Maybe lenders will be less paranoid about appraisals causing buybacks and cut back on Excessive Appraisal Requirements.

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One-third of realty transactions are plagued by delays, some of them fatal By Ken Harney

Excerpt:

According to the study, of the 32 percent that experienced delays, 46 percent were triggered by “financing issues,” which is up from 40 percent during the first half of 2015. Appraisal-related problems caused 21 percent of the delays and home-inspection issues in 14 percent. Of the nearly 1 of every 16 (6 percent) of deals that turned into total disasters and fell through, home inspection and financing were the primary culprits. Sixteen percent went south because of the appraisal.

https://www.washingtonpost.com/realestate/one-third-of-realty-transactions-are-plagued-by-delays-some-of-them-fatal/2016/01/19/0d74d684-beb9-11e5-83d4-42e3bceea902_story.html 

My comment: maybe that’s why some AMCs are pressuring/asking for more when you “come in” under the sales price. Their clients, the lenders, don’t like deals falling through…

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Study finds discrepancies between reported and actual home sales prices By Ken Harney

Are some realty agents hyping the pricing information on closed sales they report to their local multiple listing service, or MLS? And if so, should you care?

A first-of-its-kind study by appraisal and real estate experts suggests that maybe they are and maybe you should. Researchers compared closing documents – which are supposed to indicate the final price in sales transactions – with the prices that agents actually reported to their MLS and found that in nearly 1 of every 11 cases (8.75 percent) there were discrepancies. Overstatements of final price exceeded understatements by a ratio of nearly 3 to 1. In one case, the price reported to the MLS was 21.4 percent above the actual closing price.

https://www.washingtonpost.com/realestate/study-finds-discrepancies-between-reported-and-actual-sales-prices/2016/01/26/86d11660-c435-11e5-a4aa-f25866ba0dc6_story.html

My comment: And AMCs worry about discrepancies on public records and appraisers on GLA!! Another reason Big Data (CU) fails and needs appraiser input. 

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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 printed newsletter, Appraisal Today. For more information or get a FREE sample issue go to www.appraisaltoday.com/products.htm  or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 8AM to noon, Pacific time.

Mortgage applications decreased 2.6 percent from one week earlier 

WASHINGTON, D.C. (February 3, 2016) – Mortgage applications decreased 2.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 29, 2016.  The previous week’s results included an adjustment for the Martin Luther King holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.6 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 11 percent compared with the previous week.  The Refinance Index increased 0.3 percent from the previous week to its highest level since October 2015.  The seasonally adjusted Purchase Index decreased 7 percent from one week earlier. The unadjusted Purchase Index increased 11 percent compared with the previous week and was 17 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 59.2 percent of total applications from 59.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 5.9 percent of total applications.

The FHA share of total applications increased to 12.9 percent from 12.7 percent the week prior. The VA share of total applications remained unchanged from 11.1 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) decreased to its lowest level since October 2015, 3.97 percent, from 4.02 percent, with points increasing to 0.41 from  0.40 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.  This is the fourth straight weekly decrease for this rate.  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 its lowest level since April 2015,  3.84 percent, from 3.89 percent, with points increasing to 0.26 from 0.25 (including the origination fee) for 80 percent LTV loans.  This is the fourth straight weekly decrease for this rate.  The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.80 percent from 3.83 percent, with points decreasing to 0.35 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 15-year fixed-rate mortgages decreased to 3.22 percent from 3.28 percent, with points remaining unchanged at 0.37 (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 3.00 percent from 3.09 percent, with points remaining unchanged at 0.34 (including the origination fee) for 80 percent LTV loans.  The effective rate decreased 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

 
To purchase the paid Appraisal Today newsletter  go to

www.appraisaltoday.com/products.htm  or call 800-839-0227. 

 

Do you check to see if permits were pulled on remodeling on subject properties?

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POLL: Do you check to see if permits were pulled on remodeling on subject properties? January, 2016 

My comment: A controversial topic. I’m not surprised at the results. However, if permits are online and free I don’t know why appraisers would not get them. In my city, free online records only go back to about 1970. Most of the homes were built before 1940. It costs $15.25 to get a full permit history and it can take up to a week to get it. The old records are a bit flakey, such as “remodeling” or something else very obscure. Lots and lots of unpermitted work in my city. But, in nearby cities with a lot of tract homes built since 1950, work without permits is not done very often. I was told by a lender’s chief appraiser many years ago not to pull permits so the borrower would “not get into trouble”.For quite awhile, I have been pulling the old permits when needed and run the online permits on all properties. In other cities, if something does not “look right”, such as an addition, I pull the permits.

Appraisal Today newsletter

Where VA loans are soaring. Are you doing VA appraisals?

Excerpt:
With features including no required down payment or minimum credit score, the Department of Veterans Affairs mortgage guarantee program is a popular home finance choice for servicemembers and lenders alike. That trend continues in 2015, when 14 markets had more than $1 billion in VA mortgage lending during the first half of the year, compared to just five during the same time in 2014. From the Capitol region to Southern California – and many places in between – here’s a look at the top 10 markets for VA mortgage lending. The data, from RealtyTrac, is based on metropolitan statistical areas ranked by total VA originations during the first half of 2015, along with the year-over-year increase for that market.

My comment: Still not doing VA appraisals? They are the only client I know that has stated fees and no big hassles, scope creep, etc. I have an article on how to get on the VA panel, the plusses and minuses, etc. I spent a lot of time interviewing VA employees and fee appraisers. “VA is looking for fee appraisers! C/R fees and no AMCs!!” Read this article before applying for the panel or to find out why you can’t seem to get on the panel.It is in the June 2014 issue of Appraisal Today, available free to all paid subscribers.

From this week’s MBA loan volume report:

The FHA share of total applications is 13.7. The VA share of total applications is 10.8 percent . I have no idea why so many appraisers don’t want to work for VA but do FHA appraisals with the considerable inspection requirements!!

Appraisal Today newsletter

ID badges for appraisers? A controversial topic

 

Excerpts:
Appraisers are not required to provide identification (in California), even a driver’s license, when they come to a house, do not always look the part and can cause alarm if not expected. One Orange County company says that is a problem.

Six months ago, Mission Viejo-based Comergence rolled out something the appraisal industry has never had – shiny ID badges.

Since the service started, just 22 of roughly 300 appraisers in San Diego County have signed up and the head of local industry group, the Appraisal Institute, says she thinks she knows why.

“A badge doesn’t identify you any differently than a business card does,” local Appraisal Institute president Susan Merrick said. “It’s pretty much typical operating procedure to give a business card when you go to the door… From a residential standpoint, it’s totally useless as far as I’m concerned.”

The state Bureau of Real Estate Appraisers says there is no law requiring appraisers to carry identification and has no opinion on Comergence.

Bureau head Jim Martin said he is not aware of any recent occurrences, at least in the last two years, of someone posing as an appraiser.
A San Diego commercial appraiser with 30 years experience, Gary Rasmuson, has pushed for a badge for the industry for years and even created his own.

My comments: This is controversial among appraisers. Many years ago, the chief appraiser for a lender told me that appraisers should not give a business card to the borrower. Of course, I didn’t agree. I have always give out business cards as that is a good source of referrals for me for non-lender work. I also want to be seen as a professional.

Appraisal Today newsletter

7 Things an appraiser has to be thankful for

 

NO WORKING ON THANKSGIVING!! USPAP VIOLATION!!! THE APPRAISAL POLICE ARE WATCHING YOU!!!

 
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7 Things an appraiser has to be thankful for
Most Excellent comments By Tom Horne on his blog
I didn’t have time to contact Tom for permission to read his entire blog posting. It is worthwhile reading.
It’s easy to get caught up in the negative parts of our jobs, however I would guess that if we all thought about it we would find more positive Things an appraiser has to be thankful for things than negative. It’s always nice to have something like Thanksgiving to help us reassess our situation. Appraisers are no different than anyone else.
  1. Relaxed work schedule- The majority of appraisers work for themselves and enjoy a relaxed work schedule.
  2. You can pick and choose your clients.
  3. You’re in total control of your success.
  4. Good blend of working in and out of the office. I like my job because I don’t have to sit at my desk all day. I am able to work outside of the office during appraisal inspections which helps me to not get bored with what I am doing.
  5. You have control over how much money you make. A good part of owning your own business is that you are in charge of everything you do.
  6. Current trends in grassroots efforts. … some positive changes that have resulted from this is the trend in appraisers starting to take control of the situation and make themselves heard through the use of social media and state coalitions.
  7. Better tools for doing our job.
Read the details at:

Appraisal Today newsletter