Category: Appraisal

Borrowers to Refinance with No Appraisals 1

FHA Borrowers to Refinance with No Appraisals

More FHA Borrowers to Refinance without Appraisals The Obama administration announced March 6 that the Federal Housing Administration would reduce fees that have prevented some FHA borrowers from refinancing at ultra low rates over the past year, The Wall Street Journal reported. The change will reduce fees through what’s known as a “streamline” refinance, which is reserved for FHA borrowers who refinance into another FHA-backed mortgage. The process does not require borrowers to verify income, employment or credit — and it does not require a new appraisal, which means that underwater borrowers can refinance, the Journal reported. Many borrowers who...

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Thing of Value

Pay for an assignment? “Never. It’ll never happen!” It happens all of the time. While most appraisers would never dream of violating the Management portion of the Ethics Rule by paying for work…many do it every day without giving it any thought. Management: An appraiser must disclose that he or she paid a fee or commission, or gave a thing of value in connection with the procurement of an assignment. Comment: The disclosure must appear in the certification and in any transmittal letter in which conclusions are stated; however, disclosure of the amount paid is not required. In groups or...

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Making Sense of Marketing Time and Exposure Time

Marketing Time Strangely enough, USPAP 2012-2013 does not include a definition of Marketing Time. Marketing Time is only addressed in the Advisory Opinions (AO 7) and the Advise from the ASB is that reasonable marketing time is an opinion of the amount of time that might take to sell a property interest at the concluded market value during the period immediately after the effective date of an appraisal. Exposure Time USPAP requires an opinion of exposure time, not marketing time, when the purpose of the appraisal is to estimate market value. USPAP 2012-2013 defines Exposure Time as the estimated length...

AMC’s Filing Complaints Against Appraisers 0

A Refreshed Warning about Some Risky E&O Sold to Appraisers

We first warned appraisers about this problem almost a year ago, but many appraisers are still falling prey to the marketing for some “no frills” E&O insurance policies and their lack of coverage. Advertisements for this product appear in some respectable newsletters and publications. Fortunately, others have taken steps to protect their members and readers by providing information, e.g., the Appraisers Coalition of Washington published a warning for its members in April last year on the ACOW website and Ann O’Rourke also published a warning last year in her popular Appraisal Today newsletter. The central problem is what might be...

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FHA Updated Valuation Protocol FAQs

FHA Updated Valuation Protocol FAQs Revised 02/28/12 FHA has updated the Valuation Protocol FAQs posted on the FHA Appraiser Roster web page. The most recent FAQ can be found on page 27 of the document and provides clarification for what constitutes an acceptable conventional heating system. You can periodically review the FHA Appraiser Roster web page for alerts on recently published Mortgagee Letters of interest and other pertinent announcements. The publication contains the following topics: New Construction Wood Destroying Insects/Termites Utilities – Well and Septic Inspections & Certifications Cost Approach Accessory Dwelling Units Manufactured Housing Two Unit Properties HECM Appraisals Lender...

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To Permit or Not to Permit

Excluding additions which may require permit issued by an agency of government… OK, it isn’t Shakespeare, but, it is something of interest — and concern — to licensed appraisers in Illinois. The concern begins with an appraiser accepting an unusual assignment condition. An AMC, acting on behalf of a lender is demanding that appraisers exclude from the Gross Living Area areas of the subject residence, additions to the original construction unless it is proven that the additions were legally permitted. We must understand that what is asked of the appraiser is not couched in terms of a guideline; this is...

Concessions - when & how much to adjust 7

Concessions – When & How Much to Adjust

There is a lack of consensus or understanding among appraisers regarding concessions paid to a buyer in a sales transaction. The focus here is on appraisals communicated via a current Fannie Mae/Freddie Mac form. The intent of this article is to bring some clarity to this topic, whether you’re appraising the property as a purchase transaction or using it as a comparable sale after it has closed. First, in your appraisal due to purchase, a concession to the buyer of the subject of your appraisal must be reported in the contract section of the appraisal report. However, you must remember...

AVMs No Substitute for Real Estate Appraisals 0

AVMs No Substitute for Real Estate Appraisals

With lenders facing myriad challenges and consumers seeking cost reductions, it might be tempting to take a shortcut with real estate valuation — but the negative impact could be significant and long lasting. Some lenders utilize automated valuation models in certain cases. However, AVMs are not real estate appraisals; the two are not comparable. An actual appraisal typically requires the appraiser to visit the property and to perform a visual inspection. This enables the appraiser to accurately report property information, which they then verify. Appraisers use their experience, expertise and education to determine which comparable sales to use and what...

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Time for an Appraiser Union?

Much talk has occurred lately on a variety of injustices incurred by appraisers through scope-creep, indemnification clauses, decreasing number of appraisers, lawsuit volume increases, and the like. Naturally, there are a whole lotta unhappy appraisers out there. Surely, there are many things to be concerned with, but there is a greater fear that overrides all other issues; the fear that there ain’t a dang thing we can do about it. The lack of ability to make changes to those things we view as wrong is a debilitating feeling. As small business owners, we are used to getting things done our...

American Guild of Appraisers Petitions Fed 0

Fed Petitioned by American Guild of Appraisers

American Guild of Appraisers Petitions Fed and Consumer Financial Protection Bureau to Overturn Regulation that Threatens Viability of Professional Appraisal Practice WASHINGTON, Feb. 23, 2012 /PRNewswire-USNewswire/ — The American Guild of Appraisers (AGA), a national organization of real estate appraisers that is an affiliate of the AFL-CIO’s Office and Professional Employees International Union (OPEIU), has petitioned the Federal Reserve Board (“Fed”) and the Consumer Financial Protection Bureau to overturn a regulation adopted by the Fed that is contrary to the Dodd Frank Financial Reform law, threatens the viability of professional appraisal practice and undermines the legitimacy of real estate appraisals...

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