Michael Zollo's (mikeyzee) Blog

More Money for Fran & Fred

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Thu, 24 Dec 2009 07:14:23 -0800

By J.W. ELPHINSTONE, AP Real Estate Writer J.w. Elphinstone, Ap Real Estate Writer - 19 mins ago NEW YORK - The government has handed its ATM card to beleaguered mortgage giants Fannie Mae and Freddie Mac. The Treasury Department said Thursday it removed the $400 billion financial cap on the money it will provide to keep the companies afloat. Already, taxpayers have shelled out $111 billion to the pair, and most analysts hadn't expected the companies to hit the limit. Treasury Department officials said it will now use a flexible formula to ensure the two agencies can stand behind the billions of dollars in mortgage-backed securities they sell to investors. The formula will provide the companies with a sufficient cushion based on projected losses over the next three years. By making the change before year-end, Treasury sidestepped the need for an OK from a bailout-weary Congress. But the timing of the announcement on a traditionally slow news day raised eyebrows. "The companies are nowhere close to using the $400 billion they had before, so why do this now?" said Bert Ely, a banking consultant in Alexandria, Va. "It's possible we may see some horrendous numbers for the fourth quarter and, thus 2009, and Treasury wants to calm the markets." Fannie Mae and Freddie Mac provide vital liquidity to the mortgage industry by purchasing home loans from lenders and selling them to investors. Together, they own or guarantee almost 31 million home loans worth about $5.5 trillion, or about half of all mortgages. Without government aid, the firms would have gone broke, leaving millions of people unable to get a mortgage. The biggest headwind facing the housing recovery has been the rise in foreclosures as unemployment remains high. Treasury said its latest move could allow Fannie and Freddie to play a bigger role in restructuring mortgages for troubled borrowers. Treasury officials will provide an updated estimate for Fannie and Freddie losses in February when President Barack Obama sends his 2011 budget to Congress. Though the administration has yet to disclose its long-term plans for the two companies, they are unlikely to return to their former power and influence. The news followed an announcement Thursday that the CEOs of Fannie and Freddie could get paid as much as $6 million for 2009, despite the companies' dismal performances this year. Fannie's CEO, Michael Williams, and Freddie CEO Charles "Ed" Haldeman Jr. each will receive $900,000 in salary, $3.1 million in deferred payments next year and another $2 million if they meet certain performance goals, according to filings with the Securities and Exchange Commission. The pay packages were approved by the Treasury Department and the Federal Housing Finance Agency, which regulates Fannie and Freddie. That pay is far less than what their predecessors earned. Former Fannie CEO Daniel Mudd received $10.2 million in 2008 and former Freddie CEO Richard Syron pocketed $13.1 million. Both execs were ousted when federal regulators seized the companies in September 2008. The federal government blocked exit packages for the pair worth up to $24 million. The chief executives' pay could spark new criticism about the government's numerous bailouts, but that may be unfounded, said Mark Borges, principal with management consulting firm Compensia. Haldeman and Williams each could command between $5 million and $10 million in a similar position in the private sector, Borges estimated, and without the notable challenges and public scrutiny they face at these companies. "I doubt too many people would look at these jobs and say, 'Gosh, I would love to go there for my next career move,'" Borges said. "The government is getting top notch executives to solve problems that are not easy to solve." The bulk of their pay is also not guaranteed, Borges said, so these executives can't pocket and run and must meet certain long-term goals or risk giving some of it back. Freddie Mac's board sets the performance goals for the chief executive, which won't be disclosed until next year. Fannie Mae's filing outlined its corporate goals including "being a recognized leader in the housing recovery," "protecting taxpayers," and "managing risk more effectively." Fannie Mae and Freddie Mac declined to offer further details on CEO performance goals. Public anger over Wall Street pay boiled over earlier this year. In response, the Obama administration imposed pay curbs on banks that received government bailouts. All the major banks have since repaid their federal money, largely to escape caps on executive pay. Former Bank of America Corp. CEO Ken Lewis, for example, agreed to forgo his salary and bonus this year under pressure from the government. Last year, he pocketed more than $9 million in total compensation. Bank of America received $45 billion in government assistance, which it has since repaid. Freddie Mac hired Haldeman, a former mutual fund executive, in July. At the time, the company disclosed his annual salary of $900,000 but did not disclose other incentive payments. In September, the company hired a new chief financial officer, Ross Kari, and said his pay package would be worth up to $5.5 million. Williams, formerly Fannie Mae's chief operating officer, took over as CEO in April after the first government-appointed CEO, Herbert Allison, took a job at the Treasury Department. Williams earned a base salary of $676,000 last year, plus a retention award of $260,000. Washington-based Fannie Mae was created in 1938 in the aftermath of the Great Depression. It was privatized 30 years later to limit budget deficits during the Vietnam War. In 1970, the government formed its sibling and competitor McLean, Va.-based Freddie Mac. ___ AP Real Estate Reporter Alan Zibel and AP Economics Writer Martin Crutsinger in Washington contributed to this report.

Fannie, Freddie CEO pay gets regulator nod, can I a pay package Nod???

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Thu, 24 Dec 2009 00:53:11 -0800

Fannie, Freddie CEO pay gets regulator nod: report Wed Dec 23, 11:50 pm ET (Reuters) - The U.S. housing regulator has approved pay packages for the chief executives of mortgage finance companies Fannie Mae (FNM.N) and Freddie Mac (FRE.N) in the range of $4 million to $6 million, the Wall Street Journal said, citing people familiar with the matter. The Federal Housing Finance Agency has approved the pay details for Fannie's Michael Williams and Freddie's Charles Haldeman, which the housing companies are expected to spell out in a securities filing on Thursday, the paper said. Fannie Mae and Freddie Mac, which together own or guarantee half of all U.S. mortgages, were seized by the U.S. government and put into conservatorship in September 2008 at the peak of the credit crises. The Federal Housing Finance Agency did not immediately respond to a Reuters email seeking comment that was sent outside of regular U.S. business hours. (Reporting by Sakthi Prasad in Bangalore; Editing by Valerie Lee)

WILL THE GENIE GO BACK IN THE BOTTLE!!!!!

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Thu, 10 Dec 2009 01:24:46 -0800

WILL THE GENIE GO BACK IN THE BOTTLE !!! If HR4173 passes will we be able to put the HVCC GENIE back in the bottle (and put the bottle in the nearest dumpster), and do away with appraisal prostitution! I personally don't think so, the AMC's and Banks (kind of one in the same) hold way too much power. Besides, how many Real Estate Appraiser do you know who can afford $500-$1000 a plate, political fund raising dinners? I could think of a few Bank Executives, for each bank who could! And for the record I'm not talking about the small AMC's.

Market Conditions???????????????

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 04 Dec 2009 02:43:32 -0800

I have a question to my fellow appraisers. This question is mainly directed to appraisers working in underperforming markets, like Florida, Arizona, Nevada, and California. What are you doing when the subject's subdivision is increasing in value, but everything in the else in the area is declining? On page one the section on "Market Conditions", now I was trained that Market Conditions, included an area larger than the subdivision, like a section of the county. When I filled in The Great 1004MC form, it showed the trend is increasing values for the subdivision. We all know why I'm posing this question, it was an Underwriting Condition!!!!!! I stated in the report why I did not make any adjustments to the sales that were over 90 days old (I guess they overlooked that in the addendum, go figure), and cited the 1004MC, and the local MLS data. So do we only use the 1004MC data for Market Condition, from now on, when a subdivision is increasing? I'll quote Rick Moranis from Head Office, "I Love My Job!!!!" as I'm hooked to a blood pressure tester.

My New Appraisal Organization

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 27 Nov 2009 01:41:07 -0800

Hello all! I'm starting a new appraisal organization; it will be called National Association of Broke Appraisers (NABA). Unlike other Appraisal organizations, the fee will only be $50.00 for a life time membership. And you say what do I get for my $50.00? You get to put the NABA designation at the end of you state id number that should get you a ton more work and nothing else. Just think you don't have to spend a lot of money on high priced CE courses, from NABA, because we don't have any! You'll never find an ad from AMC's that wants 50% of your fees, or any of the Z companies (that were running 4 page ads), in my news letter or magazine, because I will not have one. If any legislation comes out of any government office I'll do like most other Appraisal Organizations do, take a wait and see approach (in other words, stick my head in the ground like an Ostrich)! The only thing you need is a valid State Certification, as a General or Residential Appraiser, and don't forget your $50.00! Michael Zollo, CFO, Secretary, Treasure, Head Money Spender, Hell I do It All! A subsidiary of the firm of Me, Myself, and I that's a subsidiary of the firm of Dewey, Cheatham and Howe!

Have all the lenders gone Insane?

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 06 Nov 2009 07:38:58 -0800

A fellow Appraiser I work with called me earlier today, to ask if I was a Flagstar approved appraiser. I said I was and check my status about 4 months ago and was still active. He stated the last time he checked he was approved, and he had a report he wrote and Flagstar would not accept it, stating that he's not approved!!!!!! So I called their Appraisal department, and I was told that, I'm no longer approved!!! As it turns out, I have not had any reports sent to Flagstar in the past year, so they kicked me off the list. I asked how do I get back on the list, I was told that my area is full and they are not adding any Aappraisers to the list in my area. I could under stand if there was an issue with the quality of my work, but because most of my clients closed down, and then HVCC, and I haven't been getting much work, I'm dropped from the list. I guess it's my fault, I should have been prostituting myself for those $150.00 Appraisal orders, that the lender love so much.

NVS CO-OP, any Appraisers getting work?

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Wed, 26 Aug 2009 00:51:47 -0700

This is a question to all the Appraisers on Active Rain. Are any of you signed up with NVS co-op, the Appraisal Co-op, and are you getting any orders? I thinking about joining, but with the way times are, I'm trying to spend my money as wisely as possible.

REALTOR’S, WHO’S DOING YOUR APPRAISAL!

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Thu, 23 Jul 2009 04:48:23 -0700

REALTOR'S, WHO'S DOING YOUR APPRAISAL! In today's climate of HVCC and FHA loans, I've been hearing the horror stories form realtors, about bad appraisals. Do you know who's doing the appraisal? Is the person a certified appraiser, or a trainee? Did you know that trainee's can not work FHA appraisals? Did you also know you can only order 1 appraisal per FHA case number? Does the appraiser even have a state license, or access to you local MLS? Here are some tips that might help avoid some nightmares. When the appraiser calls to make the appointment, find out the appraiser's license type, State Certified, licensed or a trainee. Find out the appraiser's license number, and find out what AMC it was ordered through, most AMC's don't allow trainees to do the work. Ask the appraiser, if has access to MLS, if not contact the AMC, and ask for another appraiser. Look up the appraiser's license, is the license valid, are there any complaints filed? Again most AMC's will not work with appraisers with complaints filed against them. When meeting the appraiser at the property (NOW IS NOT THE TIME TO BE LAZY AND SAY IT'S ON A LOCKBOX), ask for a business card, his state license, and photo ID, make sure they match. Make sure the person doing the work, is the person signing the report.

The joke of The Day

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 19 Jun 2009 12:14:42 -0700

The Joke of the Day. I met a realtor out at a home, I had to appraiser. So while I was talking to him, as I was doing my inspection (yes appraiser can still talk to realtors), he asked me if I liked working out of the appraisal pool. I said what pool? I was thinking he was talking about the cesspool of AMC's, that all of us a swimming in. I had to educate him about the new frontier of residential appraising. Then he proceeds to ask if the home will appraise!!!!! I told him I couldn't talk to him about the value. Then he hands me his list of comps, you know, homes on canals, or have in- ground pools, wile the subject is a dry lot home, without a pool! The kicker was the last comp on his list was in another city. To his credit it was less than a mile away. I felt like I was sent back in time, to 2005. Some people need a wake up call.

Stress

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Sun, 05 Apr 2009 02:26:09 -0700

This is a note for my fellow appraisers, and to anyone else under a tremendous amount of stress. I hope this post will also help, the people sitting on the sidelines, that just read the blogs, but are to afraid to write one, or post a comment. Because if you're too afraid to post to a blog, you might be too afraid to talk to someone about your troubles. With our uncertain future, with the HVCC start date of May 1st, I'm reading some posts. By people who are very stressed out. I know I'm one of them, the best advice I could give is talk to someone! Most appraisers work by them selves, not in a shop or office setting, and sometimes, we has humans need to vent. Talk to someone outside of the industry, your support network of family and friends. If you don't have a support network, talk to a clergyman, or a counselor, get it off your CHEST!! Stress is a KILLER, it lead to heart attack, stroke, depression and other illnesses. The build up of stress, and the feeling of being overwhelmed, also leads other people to snap. By talking to someone, and listening to them, you might see things in a different light. Maybe a way out, if not at least you vented.

Question of the Day.

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 26 Sep 2008 10:29:49 -0700

Can a Residential Appraiser legally appraiser a 10 acre site, that only has a barn with 6 stalls and a 2bed/2bath grooms quarters? The subject is zoned residential acreage, and the area has large home sites, with barns (for horses) and vacant land also. I would like to get some input on this.

What is your take on appraising a Condo/Hotel

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Thu, 04 Sep 2008 09:02:19 -0700

I'm looking to get some input from other appraiser, about appraising Condo/Hotels. For those of you who have never seen or heard of a Condo/Hotel, it's a Hotel were some or all of the units are individually owned condominiums. As the owner of the unit you have a choice if you want the hotel to rent out the unit it for you, of course there are fees involved. Now my question is, should these be appraised by residential appraisers, or only general appraiser? I think they should only be handled by general appraisers, because the building is still a hotel. I would like to get some feedback from other appraiser out there. I figured it might be a good topic, to make us think about something else, then all the negative stories we have been writing about.

The address and numbers have been changed to protect the guilty!

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Fri, 29 Aug 2008 10:53:32 -0700

I just received an e-mail form an Appraisal Management Company and here's what it said, Michael, This is an order if we can get 295-299k need to know ASAP thanks The address is, 9999 any street Fort Lauderdale, Fl 33309 My reply to them was, Hi, I don't mean to be rude, but you're asking for a pencil search, that is by the way illegal! So if you want an appraisal put in an order, if you're are looking for a number hitter, there are a ton of them in Miami. I don't want to waste your time or mine. Thanks Mike Now I know my reply was kind of blunt, but I'm getting sick of this crap, and I know all of us Appraisers have received these e-mails. What they are really saying is, Dear Mr or MS Appraiser, Would you be kind enough to commit Mortgage Fraud for us. We know that as the AMC, we will not get in trouble for asking you to do this, but you on the other hand will be in hot water if caught. Please let us know asap What I would like to know is, when will the Federal or State regulates go after these jokers, not just the Appraisers.

HAPPT MOTHER'S DAY

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Sun, 11 May 2008 01:33:59 -0700

Happy Mother's Day, especially to all the Moms taking care of their families by them-selves.

Florida Real Estate Appraisal Board proposal for Trainees

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Wed, 23 Apr 2008 05:34:27 -0700

In the minutes of the February meeting of the Florida Real Estate Appraisal Board, there is a proposed change on how licensed Trainees possibly in the further, will go about becoming Certified Appraisers. Some of the changes will be,1) Trainee experience requirements changed from 2 to 5 years2) Use exam modules to test experience3) Test trainees periodically during that time to evaluate the experience they have gained4) Advancement to certification will require successful completion of each level of experience evaluationTo get more information use this link, https://www.myfloridalicense.com/dbpr/re/FREABMeetings.html and click on the February 4 & 5 meeting minutes.While I feel the possible change to 5 years might be excessive, but with the housing market slow down we are currently in, it might take 5 years go get enough appraisal reports or hours. I do think that the rest of the recommendation are needed to make sure Trainees are getting the right mentoring, and education that is needed to do the job. One recommendation I would like to make is that Florida, needs to look into the North Carolina rule that newly Certified Appraisers CANNOT have trainees working under them for the first 2 years.

Appraisers and Active Rain, Has anyone generated any work from AR?

Michael Zollo, Certified Residential Appraiser, South Florida, FH — Sat, 19 Apr 2008 01:59:53 -0700

First let me start off by saying, that this posting is in no way, trying to put down Active Rain. I personaly thing it's the best site I've been too so far for appraisers, not just for Realtors. I would like to get some feed back from appraisers if they received any work from this site. I my self have only found 1 job from the Referrals section, and that proved to be a dead end.