Appraisal News and Business Tips

Posts Tagged appraisal fees

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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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. 

 

NEWZ// 1-28-16 Not C-R fees-fined/AI twitter hacked/Building permits?/50 castles/adjustments

 

50 castles in 50 states

Excerpt:

The United States of America is not typically thought of as a land of castles, and with good reason-the uniting of the American states coincided, not coincidentally, with the beginning of the end of the era in which kings and queens ruled over everything, holing up in huge fortified houses so that the peasants and/or invading barbarians couldn’t kill them.

But in a way, that’s too bad, because the U.S.A. is a land of excess, and there’s nothing more excessive than a castle. And there are some castles in this country-maybe more than you’d expect-which range from (mostly) vanity projects, to mini golf courses, to even a few places that originally served some military purpose. Not only that, but many of them are currently for sale. If you’ve ever dreamed of owning a castle of your own, you could, for as little as a few hundred thousand dollars, or as much as a over ten million. (If you want to have your wedding in a castle, the options are even more vast.) In fact, we found a castle in every state in the U.S.A

Here are a few:

– This Illinois Castle Costs a Mere $795,000

– Majestic Castle in the Adirondacks Offers Turrets, Knights, and – Secret Passageways for $12.8M

– Ludicrous $4.9M Texas Castle Really Loves Turrets

My comment: Photos and links for more info for all 50 castles!!

Easy to view – scroll down the page, no excessive popup ads.

Check it out at:

http://curbed.com/tags/castle

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Appraisal volume starts to lose momentum

Reverses last week’s rise

Posted January 26, 2016

 

Excerpts:

Appraisal volume erased most of last week’s rise, falling 4.1% for the week of Jan. 17, the most recent report from a la mode, an appraisal forms software company that tracks appraisal volume throughout the country, showed.

A week ago, appraisal volume grew 5%, following a strong surge the week prior.

“While appraisal volume started the year with a strong recovery from the Christmas and New Year slump, it has not seen the energy that mortgage applications have shown. This is perplexing but could be because of lenders still getting used to the new TRID procedures and delaying ordering appraisals or just that the applications are falling out and not turning into mortgages,” he continued.

Click here to read other comments and see the data.

http://www.housingwire.com/articles/36111-appraisal-volume-starts-to-lose-momentum 

My comment: this report is posted every week. Please also see the MBA Weekly Mortgage Loan Origination volume report at the end of every weekly email newsletter, posted on Friday. Appraisal ordering follows originations, so MBA is slightly ahead of the a la mode report.

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

Source: www.appraisalport.com Vote in their current poll: 

Do you consider appraisal trade groups important to the industry?

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. 

WHAT DO YOU THINK ABOUT THIS TOPIC? POST YOUR COMMENTS AT www.appraisaltodayblog.com !

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Coming in the February 2015 Appraisal Today paid newsletter, available Monday, Feb. 1 

Adjustments, Part 1 – Are you making too many adjustments 

Huge change in supporting adjustments since Fannie’s CU started looking at them. State regulators also want to see adjustment support – don’t get sanctioned. Some reviewers want to see support. Etc. 

Some of the topics: 

– How are appraisers supporting adjustments?

– What are the most frequent adjustments?

– What are state appraisal boards looking for?

– What is CU looking for?

– Do adjustments really make a difference in the final value?

– Qualitative vs. Quantitative adjustments

– The best adjustment sources of information

Part 2 will be on types of adjustments. 

FREE TIP: 

NO ADJUSTMENT SUPPORT METHOD WILL WORK FOR ALL ADJUSTMENTS.  

Cancel at any time. For any reason!! 

To purchase the paid Appraisal Today newsletter  go to

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

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Appraisal Institute falls victim to Twitter hack

Posted January 22, 2016, last Thursday

Excerpt:

Instead of tweets about the appraisal industry, tweets emanating from the Appraisal Institute’s account for the last 18 hours or so have more to do with Playboy Magazine, Hooters, David Hasselhoff, links to “sexy” videos, and other inappropriate tweets. 

Among other tweets, the hacked Appraisal Institute account tweeted out “to all staff and employees: because its so warm out today, you have to work an extra 2 hours pretending to do actual work” and “new company policy in effect: at social gatherings and events, having fun during such events is forbidden. Unless authorized.”

 As of last Friday: “It appears that the Appraisal Institute Twitter hacking of 2016 is now over, but we’ll always have the screenshots.”

Very interesting. All the old tweets were lost, except for re-tweets. See lots more, including some of the tweets at:

http://www.housingwire.com/articles/36086

 Comments from the Appraisal Institute: ” The Appraisal Institute’s Twitter account and YouTube channel were compromised last week. Twitter has since been restored, temporarily using the handle: @RealAI_National. We’re in the process of restoring our YouTube channel.” Regarding who did it: “We are investigating the matter and have no further comment at this time.”

 

My comments: I knew I shoulda re-subscribed to the AI twitter feed!! I originally subscribed in 2010 but have not been getting any tweets. I have never had any twitter feed I subscribe to get hacked… I think that the AI will get a lot of new Twitter subscribers, including me!! Subscribe to @RealAI_National. Currently 3,936 followers.  

At the bottom of the article is a comment post by Jason Constantine: “This was the work of one, former disgruntled employee with a shady criminal past. He was jaded because he was replaced with another programmer and wouldn’t take a background check. Can’t prove it but he’s hacked me several times in the past.” Makes sense to me. You don’t get much notoriety from hacking the AI. When you read the tweets in the article, it definitely sounds like an employee. Some are sorta funny ;             

 
To purchase the paid Appraisal Today newsletter  go to

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

 

 

AMC Fined Over C&R Fees

Excerpts:

The Louisiana Real Estate Appraisal Board (LREAB) has again taken action to ensure that Customary and Reasonable (C&R) Fees are being paid by AMCs and lenders in the state.

On December 8, 2015, after a hearing that lasted over 12 hours and was closely watched and attended by appraisers, AMCs, and lenders alike, the Board ruled against iMortgage Services, LLC and issued a Final Order that included a fine of $10,000 and a six-month license suspension. The suspension was stayed, provided that iMortgage provides a C&R compliance plan to the Board no later than March 21, 2016 

In contrast to Louisiana’s previous C&R enforcement action involving Coester VMS, where there was no admission of guilt by Coester, this is the first judgement against an AMC that leaves no question on the determination of guilt. The Board’s final order establishes that iMortgage failed to comply with Louisiana law and violated the C&R fee requirements set in place by the Board.

Demonstrating the glacial speed at which many state board investigations operate, the initial complaint against iMortgage was filed two years ago in January 2014 after iMortgage sent out an appraisal order for a full 1004MC FHA appraisal with a fee of $200. The investigation was not opened until May 2014, with the hearing taking place in December 2015.

My comment: Almost 300 postings at http://appraisersforum.com/ . Search for AMC Fined For Not Paying C&R Fees. Warning: lots of chit chat, etc, typical for AIforum Just wade through them to get to what you want. Comments also posted after the article. 

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Very interesting workingre article. Read more here:

http://www.workingre.com/AMC-fined-over-cr-fees 

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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 increased 8.8 percent from one week earlier 

WASHINGTON, D.C. (January 27, 2015) – Mortgage applications increased 8.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 22, 2016.  This week’s results include an adjustment to account for the Martin Luther King holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 8.8 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index increased 0.3 percent compared with the previous week.  The Refinance Index increased 11 percent from the previous week.  The seasonally adjusted Purchase Index increased 5 percent from one week earlier. The unadjusted Purchase Index increased 0.4 percent compared with the previous week and was 22 percent higher than the same week one year ago.

 

The refinance share of mortgage activity decreased to 59.0 percent of total applications from 59.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.9 percent of total applications.

The FHA share of total applications decreased to 12.7 percent from 13.7 percent the week prior. The VA share of total applications increased to 11.1 percent from 10.8 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, 4.02 percent, from 4.06 percent, with points decreasing to 0.40 from  0.41 (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 3.89 percent from 3.93 percent, with points decreasing to 0.25 from 0.31 (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 3.83 percent from 3.86 percent, with points increasing to 0.38 from 0.36 (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 3.28 percent from 3.29 percent, with points decreasing to 0.37 from 0.39 (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 3.09 percent from 3.20 percent, with points increasing to 0.34 from 0.18 (including the origination fee) for 80 percent LTV loans.  The effective rate decreased from last week.

If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please visit www.mba.org/WeeklyApps, contact mbaresearch@mba.org.

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

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PAID 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

How to Stay Happy as an Appraiser

How to Stay Happy as an Appraiser with Ann O’Rourke – Dustin Harris Podcast 12/13/15

In a recent paid Appraisal Today newsletter I wrote an article: “Staying positive with unreasonable fees and Scope Creep from AMCs”. In my article I go over many ways to be positive. These ideas are not new and have been around for many decades. I applied them to appraisers.

Whenever I do public speaking, I am much more “out there” than I am when I write. I am much more spontaneous, similar to when I am interviewed for podcasts.

I don’t think that there have ever been as many dissatisfied residential appraisers as there are now, primarily due to several factors:

– AMC and over-management of appraisers

– Low AMC fees for the work required

– Ever increasing requirements from investors and lenders

I know many long time residential appraisers who have quit appraising because they don’t want to work for AMCs. If I could only get work from AMCs, I would have quit also. But, I also know appraisers who do a lot of AMC work and they are satisfied with it. Dustin is a good example. They modified their businesses. I also know appraisers who do very little AMC work.

All successful business people have a positive attitude. Some of us are fortunate to be born that way. But, you can change your attitude.

Click here to listen

http://theappraisercoach.libsyn.com/075-how-to-stay-happy-as-an-appraiser-with-ann-orourke

 

To subscribe or listen on other web sites, go to

– Android – http://www.stitcher.com/podcast/the-appraiser-coach

– iTunes – Subscribe to the podcast so you don’t miss any! I am a subscriber.

https://itunes.apple.com/us/podcast/the-appraiser-coach-podcast/id966765322

– Website – http://theappraisercoach.libsyn.com/

Appraisal Today newsletter

Appraiser income and expenses

APPRAISER INCOME AND EXPENSE POLLS

Appraisalport poll, 11-15, www.appraisalport.com
Considering all aspects of completing an appraisal (research, driving, inspection, writeup, etc.) what response do you think best represents your hourly wage?
My comment: Of course, this is gross, before any expenses, auto, insurance, MLS, software, etc. etc. I wonder about those making less than $25 per hour.
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In the past year, have your operating expenses:
My comment: Expenses going up, nothing new. See above poll for hourly income. What is happening with your expenses?

Appraisal Today newsletter

Part time appraisers – how many and why?

Statistics from data on appraiser licenses from www.asc.gov, and other sources, do not identify how many are doing appraisals part time or not at all.

Why does it seem like there is an appraiser shortage in some areas? Of course, it is probably a shortage of appraisers willing to work for low fees. But, this also spills over into non-AMC work as few appraisers are available as they are cranking out AMC appraisals and won’t accept non-AMC work.

I keep speaking with more and more appraisers who are no longer working long hours. There is almost unlimited demand from AMCs, but most of them do not work for AMCs. Or, work for a few AMCs that pay well and give them occasional work. Or, refuse to work for lower fees, so don’t get much AMC work.

Why do appraisers work part time?

– The median appraiser age is getting higher. Older appraisers (and non-appraisers) are no longer willing to work 60-80 hours per week. They often don’t need as much money as before. Children graduated from college, collecting social security, home mortgage paid off or have a low rate on mortgage, spouse retired, etc. I suspect that this is the primary reason.

– Fee appraisers are self employed. Many baby boomers that are employed want to work part time but their employers won’t allow it. One of my brothers started working in the printing business when he was 18. For the past 30 years he has been doing on-site printer repairs for national companies. He is 67 and would love to cut back to part time as he does not want to do a lot of driving, which his job requires. When he retires this year, there is no one to replace him. There are no new people coming into printer repairs, which requires expertise in computer software and printer hardware, and many years of experience. His employer says “no” to part time work.

– Self-employed appraisers, as we get older, can gradually cut back on how much time we spend on appraising. That is one of the best features of having an appraisal business. Also, if we start another business or get another job, we can often continue part time appraising.

– Not working but keeping license as a backup. Hard to get license back. Sometimes do an occasional appraisal. I always recommend keeping your appraisal license as long as you can. You never know when you will need extra income.

– Don’t work for AMCs and don’t get a lot of work from non-AMC clients.

I just look in the mirror. I limit the amount of work I accept. I don’t do any lender work and turn down non-lender work every week. I am 72, downsized my home, no children to support, collect Social Security of $3,000 per month since I turned 70. I worked very long hours appraising for 25 years, but 5 years ago I started cutting back on the hours I spend appraising. (I typically worked about 60 hours per week.) I get also income from my paid newsletter and ads for this free email newsletter. Most important, I need more time for my experimental music and videos, another big motivator ;>

I do appraisals and work on my appraisal business about 15 hours per week. My sfr fees are at, or slightly above, non-AMC C&R fees. I have little driving time as have been working only in my small city for the past two years – 10 minutes to go from one end to the other. I have an assistant that proofreads, invoices, etc. My typical time to writeup an sfr is about 2 hours. Total time is about 4 hours plus 1 hour for my assistant. There are few tract homes here.

What does this mean for you?

If you stay in the appraisal profession, even part time, you will have lots of work in the future. Baby Boomers are leaving the workplace, or cutting way back, in large numbers for all types of work.

 

WHAT DO YOU THINK? POST YOUR COMMENTS AT WWW.APPRAISALTODAYBLOG.COM !!

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How many appraisals per week and how much time to complete an appraisal report?

 

 How many appraisals per week and how much time to complete an appraisal report?
Source: Steve Costello at www.fncinc.com. Published 8-4-15
This month I want to discuss three recent polls dealing with how much time it takes to complete appraisal reports and how many hours you end up working to get them all done. In the first poll, we asked “On average, how many “interior inspection” appraisals reported on a 1004 do you normally produce in a week?” This poll was very popular with 4945 responses. There was a clear winner with the response of “4-6 appraisals per week” pulling in 44 percent of the vote. The next most popular answer of “7-9 appraisals per week” took quite a drop and only pulled in 20 percent vote. The last two available answers were those at either end of the scale and they were almost tied. A few appraisers really crank out the orders because 16 percent responded that they do “10 or more” appraisals per week. On the opposite end were those representing 17 percent of the vote who only complete “1-3” appraisals per week. My guess is that many of the people in this group may be semi-retired but like to keep active in the profession while making some extra money. Of course, any individual’s volume is going to depend a great deal on their specific geographic area and general complexity of their assignments.
In the next poll we asked: “On average, how long does it take you to complete a 1004 interior inspection appraisal report including inspection time (excluding driving time)?”
This was another popular poll with 4836 responses. The winner here was “4-5 hours” with 39 percent of the vote. Not far behind was “6-7 hours” with a 29 percent share of the vote. From here the numbers dropped substantially with 13 percent of appraisers going with the response of “8-9 hours”. That is really getting to be painful when it’s taking that long to finish each assignment. The most extreme answers both received the lowest number of votes. “More than 9 hours” was the choice of 8 percent of the appraisers with the final 10 percent going for the answer of “2-3 hours”. My guess is that the appraisers in that final group really have their system down to a science and fully utilize all the available technology.
Finally, we asked “On average, how many hours per day do you spend working on appraisals and appraisal related business?” This poll was the most popular of the three with a total of 5451 responses. The winner was “9-10 hours” with 37 percent of the vote. The second most popular answer with 23 percent pushed the level up to “11-12 hours”. The old standard work day of “7-8 hours” came in a distant third gathering only 17 percent of the vote. Not far behind were the 15 percent who really “burn the midnight oil” working “13 or more hours” per day. Only 9 percent work “6 hours or less” each day with most of these appraisers reporting at least 5-6 hours worked per day. It’s clear, and not at all surprising, that most appraisers are working very long hours there days.
My comment: Appraisers are working long hours now because appraisal volume is way up. If you are willing to work for low AMC fees you can get as much work as you want. I would have liked to see how many hours per week. I suspect many appraisers are working 6-7 days a week. I did, during previous boom times. These polls do not include time spent on revisions. I have some data below on that. Plus, the amount of time returning update requests – answering phone calls and emails.
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How much time is spent on revisions?
 From the November 2014 Appraisalport newsletter
On average, how much time do you spend making and delivering requested revisions on any given appraisal?@ We had a total of 4870 responses to this poll. Nearly half (48%) of those chose the response of A10-30 minutes.@ This would seem about right for most minor to moderate revisions. Many must be making pretty minor revisions because the second most popular response with 24 percent of the vote wasAUnder 10 minutes@. Another 18 percent are having to take a bit more time and went with the choice of A31-60 minutes.@ A smaller group of 7 percent is having to invest some real time to make the revisions and picked the response of AOver an hour.@ The final 3 percent selected the answer of AI don=t make revisions.@ I=m not sure if that means they are doing an amazing job on every report and never get a request or if they just refuse to do any revisions!
My comment: Lots of appraisers complain about excessive revision requests, but this poll indicates that appraisers aren’t spending much time on them. The time may have increased since 11/14.
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How often have you received revision requests that have no contributory value to the report, or were already addressed in the report commentary?” Sept 7 poll – www.fncinc.com received 3,273 votes

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NOT customary and NOT reasonable fees?//TRID??

NOT customary and NOT reasonable fees?
What is reasonable? Let me see… For example, the amount of work to produce the appraisal plus respond to request for more information, updates, etc. increases the time from 5 hours ($70 per hour) to 8 hours ($47.50 per hour),  a 33% decline. Of course that is gross, not considering your expenses. You are able to get the same fee – $350. But, the fee is not reasonable. Calculate this for your typical appraisal fees.
What is customary? Somehow AMCs seem to think that “one price fits all”. Before AMCs took over, appraiser fees varied widely around the country. The Midwest was typically the lowest, around $250. The West Coast (Washington and Oregon) and some East Coast states were higher, around $450. Alaska and Hawaii were much higher. We accepted “standard” fees from our clients as we took the easy appraisals and the hard appraisals, which balanced out. I didn’t ask for a fee increase when a property took more time. If was a high end home or a rural acreage property, the lenders paid higher fees. Or, we scheduled appraisals to reduce driving time. Clients understood that they could not give us all the hard appraisals and appraisals scattered over a wide geographic area.
Now, AMCs have standard fees, but they don’t consider the factors above. Many appraisers have responded by asking for fee increases or just turning down the assignment.
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TRID vs. the current system of AMC ordering appraisals
TRID will make the method above (“one fee for all appraisals”) very difficult for AMCs. Lenders have to provide an appraisal fee within 3 days. AMCs won’t be able to spends days “shopping” for the lowest fee for a tough appraisal. AMCs won’t have time to negotiate with appraisers. Yes, there are options but they delay the loan.
Now, appraisers can quickly accept broadcast orders with the expectation of getting a fee increase. After Oct. 3, that will create problems for lenders and AMCs.
What will happen? How can AMCs tell their lenders what to charge for a specific appraisal (the full cost, including AMC fees) within a few days? Their systems assume all appraisals are the same. I doubt if they have anything set up to distinguish complex rural from a tract home. Can AMCs even quote different fees within a state? I see AMCs making less money because the appraisal fees they pay will increase. Now, they are waiting for appraisers to tell them that the fee has to be higher.
What does this mean for appraisers who work for AMCs? Higher “standard” fees to cut down on appraisers refusing fees? This cuts into AMC profits unless they can get higher fees from their lender clients. But, AMCs compete with other AMCs. Fees are a big factor when a lender selects an AMC.
I have no idea what will happen. I am glad I don’t own an AMC with lots of lender clients. Maybe they will never raise appraisal fees for difficult properties. But, who will do them?
Volume is high now and AMCs have difficulty finding appraisers to do the tough appraisals and FHA appraisals. When volume is low and appraisers need the money, the “one fee for all” is easier for AMCs to use.

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FHA – Crawl space and attics

Crawl space and attics
Random Internet postings….
Man killed in crawlspace of Oklahoma City home, may have been electrocuted
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Posted on facebook, reportedly from FHA employees:
– If you can fit through the crawlspace door you must crawl the crawl space and inspect it all.
– Must inspect all the attic if there is access, even if there is no flooring.
My comment: If you’re fat, don’t have to inspect all of the crawlspace? Lots of stories about snakes, rats, dead animals, etc etc in crawl spaces. Appraisers crawling along ceiling joists and going thru the ceiling. Hmm… maybe FHA appraising is for the young, agile and small ;>

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Amazon and AMCs

Amazon and AMCs
You may, or may not, have heard about Amazon’s attitude towards employees – expected to be available 24×7, including holidays, significant health and family problems, etc. I don’t know if this is a bad way to run a company, but they do pay well and it is not bureaucratic. Demanding a lot of employees is not unusual for a tech company also. I do know that many other companies expect their employees to be available on weekends and evenings for emails.
But, I keep hearing from fee appraisers working for AMCs that they are expected to be available 24×7, including holidays. Phones and emails are sent at all times of the day. A quick response is expected. Cell phones ring on weekends and all times of the day and night. Appraisers have difficulty shutting off their phones and/or refuse to buy another phone for personal calls so they can shut off their only cell phone.
But… AMCs don’t pay well and have increasing Scope Creep, as compared with other clients. Why do appraisers put up with this treatment? Low self-esteem (no one else will give them work) or fear of having no business (common with self employed people)?

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