Los Angeles Times
Are you getting your money’s worth with appraisal? Despite Federal Reserve regulations that took effect April 1 requiring lenders to pay appraisers fair fees, many appraisers say they are still offered $200 to $250 by lenders for work billed to consumers at $450 or more.
MAKING SENSE OF THE STORY
- Last year’s Dodd-Frank financial reform law mandated that appraisers receive fees that are “customary and reasonable” for their local market areas, yet the Appraisal Institute says that is not appening.
- While a portion of the difference between what consumers are billed and appraisers are paid goes to the management companies that connect lenders with local appraisers and take a percentage for their services, often times lenders make a profit from the appraisal as well.
- Home buyers should care about this for several reasons. For starters, accurate appraisals are a concern for consumers, as appraisals can be deal-breakers if the appraisal comes in too low. When performed competently, appraisals can be accurate measures of the equity in a home when the homeowner refinances or seeks a second mortgage.
- Most experienced independent appraisers refuse to work for $200 to $250 because they can’t pay their overhead at that rate, leading less-experienced appraisers, who sometimes travel long distances and are unfamiliar with the area, to conduct the appraisal, which can lead to inaccurate, appraisals.
- The Appraisal Institute is seeking to persuade the Federal Reserve to tighten its regulations, which created a loophole for lenders and management companies that wanted to keep paying low fees to appraisers. In the meantime, consumers should demand transparency, asking how the appraisal fee was distributed and why.
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http://lat.ms/hIGZUL
In Other News…
Inland Valley Daily Bulletin U.S. home sales rise Investors lifted U.S. home sales last month, plunking down cash to grab cheap homes at risk of foreclosure. But purchases made by first-time home buyers fell, a troubling sign for the weak housing market.
Read the full story
http://www.dailybulletin.com/ci_17893349
San Francisco Chronicle
Homes’ solar panels often boost values Shell out the money to install solar panels on your home, and you’ll probably recoup that investment when it comes time to sell the house.
Read the full story
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/04/21/BUJ61J4J4K.DTL
The Wall Street Journal
Fed proposes minimum standards for home loans During the housing boom, many lenders and mortgage brokers didn’t operate with the consumers’ best interest in mind. They enabled and sometimes encouraged borrowers to take out loans with interest rates that shot upward after an introductory period – even ones in which the principal balance rose over time.
Read the full story
http://blogs.wsj.com/developments/2011/04/19/fed-proposes-minimum-standards-forhome-loans/
Los Angeles Times
Changes in mortgage finance rules could hurt housing recovery the government is proposing to limit the best interest rates and terms to buyers who can put 20 percent down, meet stringent debt limits, and have sterling credit.
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http://lat.ms/fUtIpf
San Diego Union-Tribune
Home energy upgrades are latest shade of green despite a sluggish economy and a growing number of Americans who think going green isn’t as important as it was before the Great Recession, efforts to increase environmental sustainability are rolling out across California.
Read the full story
http://www.signonsandiego.com/news/2011/apr/16/home-energy-upgrades-are-newshade-green-movement/
Los Angeles Times
Post-recession, expect a shift in building trends the numbers report for the home-building industry couldn’t have been more grim in February: New-home construction in the U.S. fell to a pace that would translate to about 250,000 homes for all of 2011, which would be the fewest built since the Commerce Dept. began keeping track in 1963.
Read the full story
http://lat.ms/gocqBn
Los Angeles Times
Banks are foreclosing while homeowners pursue loan modifications Lenders say “dual tracking” protects their investment if the homeowner is unable to qualify for new loan terms. But regulators seeking to ban the practice say it lulls some borrowers into thinking they won’t have their homes taken away.
Read the full story
http://lat.ms/ieLXyn
San Diego Union-Tribune
Could your mortgage broker’s pay affect your bottom line? New government rules meant to protect consumers have changed the way mortgage brokers and loan officers are being paid – drawing mixed reactions from people in the industry.
Read the full story
http://www.signonsandiego.com/news/2011/apr/19/could-your-mortgage-brokers-payaffect-your-bottom/
What you should know about the market
- Nationally, home values have declined 27 percent since the market peaked in 2006. Yet, many sellers are tempted to list their home for sale based on what they paid for it, not on the area’s current real estate market conditions. To avoid overpricing the home, sellers should arm themselves with information on comparable home sales, percentage of listings with price cuts in the area, and find out how long homes are typically on the market. All of that information, and much more, can be obtained through a REALTOR®.
- While looking at comps of recent sales in the area can be helpful in determining the list price of the home, sellers shouldn’t focus solely on this information. Checking out the listing prices of homes on the market right now also is useful, as these homes are the current competition.
- Whenever possible, sellers should avoid being home when their home is being shown. When the homeowner is around, buyers feel nervous and don’t feel comfortable inspecting the house. It’s easier for buyers to visualize the home being their when they have a chance to critique and discuss the home among themselves.
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