Fannie

Measuring Bi-level homes square footage

Fannie requiring ANSI for appraisals starting 4/1/22

By Ann O'Rourke on December 24, 2021 / Fannie, FUN, humor, square footage / Leave a comment

Tags: Fannie, humor, square footage, zillow

ANSI Update

I have been getting questions from appraisers but did not have time to research this Very Hot Topic. Below is a link to purchase the new 2021 Standards.

There are lots of comments online. The first link below by Appraisersblogs allows comments which you can read and make your own comments. The second link is a short blog post by McKissock.

Purchasing the Standards document for $25 is a good idea—link at the end of this section. I purchased a copy, so I knew what it said. Hopefully, most appraisers who do GSE appraisals will get a copy. Disclaimers coming soon regarding ANSI, assessor’s offices, etc. Disclosure of what you use is an excellent idea.

For many years, I did relocation appraisals, where 2-3 appraisers appraised the same house before the sale. Sq.ft. by the appraisers was very seldom the same. We did future values, typically 90-120 days in the future. My most favorite appraisals. Every appraisal was a test of how close I came to the sales price.

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ANSI Measuring Standard Required on April 1, 2022 – Comments allowed

By Appraisersblogs

Excerpts: includes Fannie’s 1-page “Standardized Property Measuring Guidelines” with good information.

Does following ANSI even reflect the market? Perhaps, adopting the ANSI standard will make the description of the subject property more precise. However, how is this going to help if Realtors, assessors, builders, and architects are not measuring by the same standard? Will this create a false sense of accuracy? Will there be a lot more discrepancies once the ANSI measuring standard is used by appraisers for the subject property while different measuring standards measure the comparable sales. And how do we apply the ANSI measuring standard on exterior-only appraisals, desktops, hybrids, and 2055s?

This blog post is a good place to read comments and leave your own. Over 35 comments. Click here to read.

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Fannie Mae to Adopt ANSI Measurement Standard in 2022

Short blog post with good info

By: Dan Bradley (McKissock)

Excerpt: ANSI Z765 is a copyrighted document. A downloadable PDF is available for purchase from Home Innovation Research Labs for $25.00. The website can be accessed here: https://www.homeinnovation.com/z765.

To read more, click here

Why Don’t Real Estate Agents Measure Houses? Appraiser Humor

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Residential Appraisal Errors

Appraisal Errors from Reviewers and State Boards

By Ann O'Rourke on December 17, 2021 / appraisal, bias, Fannie / Leave a comment

Tags: appraisal, bias, Fannie

25 Common Errors in Appraisal Reports

Excerpts: As a real estate appraiser, much of your success relies on your reputation as a competent professional. Unfortunately, certain appraisal violations are quite common—including errors in appraisal reports. Make sure you’re aware of these mistakes so that you can avoid them. Here’s a compilation of the most common errors and deficiencies found in appraisal reports by reviewers, regulators, and appraisal boards.

Not stating the report option utilized.
Not providing enough analysis for the intended user or reader to understand the report properly.
Inconsistencies between the description of the subject property in the improvements section and the photographs, sketch, sales comparison grid, and other areas in the report.
Inappropriate use of boilerplate commentary in the appraisal report to describe the neighborhood or to explain the reconciliation of the sales comparison approach.
Failure to summarize the support and rationale that supports the highest and best use opinion.
Not complying with the most current USPAP.
Failure to explain the exclusion of the cost and or income approaches.

To read more, click here

My comments: This was originally published by McKissock in 2019 and updated in 2020. We can always use these reminders. We know them, but sometimes forget to do them, update templates, boilerplate, etc.

What is “retirement” for appraisers?Appraisal Business Tips

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Appraisals Obsolete Now or Later?

By Ann O'Rourke on December 3, 2021 / appraisal business, Fannie, FHA, liability, zillow / Leave a comment

Tags: appraisal business, Fannie, FHA, liability, zillow

Is Appraisal Obsolete?

By George Dell SRA, MAI, ASA, CRE

Excerpt: Obsolete! Such a harsh word. Can it be?

Is the problem convolution?

Does it mean I will soon be obsolete? Not needed? Not loved? Terrible. What can be done?

Yet all the little signs are pointing that way. “Automated” valuation models have much of the market, and continue to gain. Other valuation methods and appraisal exempted transactions continue to grow. Evaluations, desktops, hybrids, auto-measurements, non-appraiser inspections, broker opinions.

To read more, click here

My comment: Another different perspective from George Dell! Check out “Appraisal startup Aloft closes $20M Series A” above! Not the first, and not the last, appraisal-related company to get millions in funding. Who needs experienced field appraisers when we have AVMs, hybrids, etc.?

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NOTE: Please scroll down to read the other topics in this long blog post on Zillow, marketing tips, Freddie and Fannie new loan limits, unusual homes, mortgage origination stats, etc.

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Sewer vs. Septic for Appraisers – Don’t get into trouble!

By Ann O'Rourke on October 22, 2021 / appraisal business, Fannie, Fannie Forms, Freddie, lender appraisals / Leave a comment

Tags: appraisal business, Fannie forms, liability

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NOTE: Please scroll down to read the other topics in this long blog post on unusual homes, Fannie new desktop form, GSEs to use desktops for purchases loans, Time management, Freddie Secret, Liability, mortgage origination stats, etc.

Appraising Fixer-Uppers

By Ann O'Rourke on October 15, 2021 / adjustments, appraisal how to, Fannie, real estate market / Leave a comment

Tags: adjustments, appraisal how to, real estate market

What About Those Fixer-Uppers?

Insights from a Seasoned Appraiser

By Steven Vehmeier

Excerpt: We’re all familiar with the term “fixer-upper.” For many different reasons, properties can come on the market in less-than-par condition. The degree and cost to cure become an issue to buyers and sellers, and a challenge for appraisers. At some point, it’s no longer “normal market value minus cost to cure equals as-is value.”

The terms “entrepreneurial incentidddve” and “entrepreneurial profit” are typically discussed in terms of investment property, but the principles involved can also be applied to the many fixer-uppers—whether the buyer is a “purely investor type” or an “owner-occupied investor type.” Maybe a couple of new terms should be discussed: “sweat equity incentive” and “sweat equity profit.”

To read more, click here

My comments: Most of my appraisals are for estates (date of death). I have never appraised a home that was ready for sale when the person died: staged, new paint and floor coverings, yards cleaned up, etc. I very seldom have any repair estimates or structural pest control or home inspection report.

I always assume the home is empty of furniture and “broom clean,” which I learned doing lots of REOs in the past. If a home is cluttered with personal stuff, the price will be lower. But, it can be fixed easily and inexpensively. If it is a mess, I tell the executor to call me when it is cleaned out so I can see what the walls, floors, kitchen countertops, etc. look like. If I can’t see, I disclose this in the appraisal and do my best to figure out a condition estimate.

Very few MLS listings here are not fixed up for sale. I look for “fixer”, “contractor”, “as is”, “handyman”, etc. in the description.

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The UAD and Appraisers – Past, Present, and Future(Opens in a new browser tab

6 Appraiser Tips on Increasing Productivity

By Ann O'Rourke on September 24, 2021 / appraisal business, bias, Fannie, Fannie Forms / Leave a comment

Tags: appraisal business, bias, Fannie, Fannie forms

6 Ways to Streamline Your Appraisal Workflow

Excerpt:

#6. Reduce revision requests

A revision will waste 15 minutes minimum. To reduce revision requests, track your clients’ common questions, and include that information in all reports when applicable. If you work for a lot of different lenders or do a lot of appraisals for lending-related purposes, those clients and intended users are probably asking some of the same questions over and over.

For example, if your clients often ask about septic, go ahead and include a comment about the septic system in your initial report. In other words, answer the question before they ask it.

To read more plus get 5 more tips, click here

My comments: Short and well written, worth reading. I have been writing about time management in my Appraisal Today monthly newsletter since June 1992, the first issue. Saving time is a very hot topic now when everyone is very busy. All of my many articles are available free to paid subscribers. They are much longer than this blog post, of course.

How to increase appraisal productivity without spending any money

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NOTE: Please scroll down to read the other topics in this long blog post on Fannie News on Forms and UAD, September Fannie Update, Bias (again), unusual homes, mortgage origination stats, etc.

Wholesale lender has AMC-free appraisals

By Ann O'Rourke on September 17, 2021 / AMCs, appraisal business, bifurcated appraisals, Fannie, real estate market / Leave a comment

Tags: appraisal business, bias, Fannie, real estate market

UWM launches AMC-free appraisal program to coordinate appraisals in-house

Excerpt: The Pontiac, Michigan-based wholesale lender will instead coordinate appraisals in-house, contracting with appraisers directly, offering appraisers and brokers a way to bypass AMCs altogether, which UWM CEO Mat Ishbia characterizes as “middlemen.”

During a Facebook Live address, Ishbia proclaimed that while AMCs add value to the industry, appraisals have been a stumbling block for the mortgage industry.

“It’s going to be cheaper for consumers and more money for appraisers because there’s no longer going to be a middleman with UWM Appraisal Direct,” Ishbia said.

To read more, click here

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Comments from Rob Chrisman’s daily email mortgage newsletter 9-13-21

Critics wonder if appraisers will sign up for UWM’s program, or any program for that matter, given the amount of business licensed appraisers have already. AMCs take about $125-150, maybe as much as $200. If a company like UWM offers $150 more than AMCs to take their orders, does it come with a price, such as an appraiser saying they won’t do business with other AMCs? Stay tuned!

To read lots more, click here Search for appraisals.

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Comments from AppraisedValue (Housing Wire) email with comments. No link available.

The larger question is whether UWM’s direct-to-appraiser approach will be attractive enough to keep appraisers too busy to work with AMCs and whether other lenders will follow suit. As our story notes: Likely the strongest incentive for appraisers is that UWM will pass along the full appraisal fee paid by the borrower. And, while AMCs have been dogged with allegations of late pay, UWM will pay appraisers the next business day after a successful appraisal completion.

Still, some AMCs, such as Class, have already instituted a process to pay appraisers within 24 hours. And some lenders don’t want the headache of bringing valuation in-house.

My comments: I like what UWM is doing, of course. As we all know, there are much more significant problems with AMCs than money, such as long lists of requirements, including everything from every lender they work for!

The Future of Residential Lender Appraisers

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Fannie and ADUs

By Ann O'Rourke on August 27, 2021 / ADUs, appraisal business, Fannie / Leave a comment

Tags: ADUs, appraisal business, Fannie

Fannie and ADUs

Video/Slides

Excerpt: Accessory dwelling units (ADUs) are becoming more and more common. Want to brush up on your knowledge of Fannie Mae’s ADU policy? Take this short elearning course to explore information about ADUs, including requirements, construction types, and how to report ADUs in an appraisal report.

To watch, click here

Note: use two arrows at the lower right to move between slides.

My comments: I received an email notification of this on 8/24/21. Worth watching. Well done. Of course, ADU requirements vary by location. They are more being built in many areas of the country. I was recently listening to an appraisal online discussion. Appraisers were from all over the country and some had appraised homes with ADUs.

My MLS recently added a section on ADUs. Not many sales there yet, but anything can help!! In my city, most new ADUs are behind a large home. Many of the owners plan on living there when they retire and renting out the much larger home. Over the past few years, the local planning and building departments have become much easier to work with. Some local MLS listings mention “ADU possible”, a relatively new trend.

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5-24-18 Newz//UAD and Fannie Form Changes. Floating Island. Refis dropping(Opens in a new browser tab)

2021 Appraiser Fee Survey

By Ann O'Rourke on August 13, 2021 / appraisal classes, Appraisal fees, bias, Fannie, UAD / Leave a comment

Tags: appraisal business, appraisal fees, bias, Fannie, Fannie forms

2021 Appraiser Fee Survey

By Isaac Peck

Excerpt: The 2021 Appraiser Fee Survey includes 365 Metropolitan Statistical Areas (MSA), as defined by the U. S. Census Bureau, with rural areas included by state. The survey includes eight different appraisal products, including reviews and FHA appraisals, and addresses turn times, to offer insight into that controversial topic by area.

To check out the very detailed report for your MSA, click here

My comments: Lots of info by MSA! I got this info Wednesday and did not have time to look at it in detail.

Raise Your Fees, especially if working for AMCs!! Before AMC broadcast bids looking for the lowest fee, appraisal fees did not change much when volume changed. Since 1986 direct lender fees went up gradually. In my area, fees were about $250 in 1986 for SFR. Now fees have gone up to about $450 – $550 for regular long-time lender clients (and local AMCs). National AMCs are not loyal. Direct lenders can be loyal.

Fascinating and very comprehensive results by state and MSAs. I hear a lot about lenders and borrowers complaining about high appraisal fees. But in my area fees are not that high per the survey. I hear regularly about desperate AMCs who will pay $1,000 or more for appraisals. Appraisers are deluged with AMC appraisal requests, which are often deleted unopened of course. I also hear that sometimes the fee to the appraiser is much lower than the AMC fee.

The UAD and Appraisers – Past, Present, and Future(Opens in a new browser tab)

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