I knew that one would get your attention. Not as drastic as it sounds, but you need to know there is some truth here. TREAD LIGHTLY
If you have not heard about the HVCC regulations taking effect May 1st, then you need to check out my blog about the HVCC.
Why Appraisers use Foreclosures
One of the essential issues in this new regulation is that NO ONE will be able to pressure appraisers to "get" a certain value for a property. Mortgage Brokers can no longer order appraisals from Appraisers, only BANKS and third parties can order reports. No Loan Officers, Realtors, Buyers or Sellers can put any pressure on the appraisers. They must let them do their job without undue influence one way or the other....or they are breaking Federal Law! YES that is true.
If the appraiser feels they are being pressured, they have a number they can call to report YOU! So tread lightly on providing appraisers with comp data. NO PROBLEM providing a list of comps and any data about certain sales that may not be common knowledge or that the appraiser would have no way of knowing, but do not tell the appraisers which comparable sales they should use! They need to review what you have given them and then THEY decide which sales are indeed comparable to the subject property.
TRUE STORY that just happened today!Our neighbor sold his brothers condo in Atlanta after his brother died. He moved everything out for the buyer as they were supposed to close TODAY...Well our neighbor made the mistake of meeting the appraiser at the property and proceeding to give him all the details ad- nauseum on the property and told him he wanted to make sure that the appraiser came up with the RIGHT value...BIG MISTAKE.and after the appraiser completed his on site work he asked him so what do you think it will appraise for.....another mistake. Appraisers can't tell you...number one... unless you are their client and site work is just the first part of the entire process. We do not just pull that number out of the air, we need to do a good deal of work back at the office before we come up with a number.
The appraiser basically told our neighbor the seller (who was NOT the one who hired this appraiser, the seller's lender did) to leave him alone and that he is NOT talking with him about this condo and that he should just leave him alone. Well my neighbor calls asking about the closing and it turns out the Appraiser refused to complete the appraisal and told the client, lender that the seller was harassing him for value and that he refused to complete the appraisal. So now they have to start all over again...and get another appraisal....I hope my neighbor learns not to do this again!
Now I Am NOTcondoning the appraiser's behavior, and he certainly should have told the client/lender what happened right away instead of delaying the closing another week, but I will tell you that if you feel compelled to tell the appraiser to review comps that you supply because other sales (many times inside the same development as the subject) are not good for some reason, you better have good facts to support your contentions.
Here is my suggestion to avoid problems: If you want to supply appraisers with sales data, give them the list both of the sales and of the subject property amenities, Then just tell them you are there if they have any questions about any of the sales or the subject property and give them your card. On the list of comps you give to them, make a note of any unusual conditions of the sale or of the home. You do not need to talk the appraisers head off because to be honest, the more you try to "convince us of anything" the more suspect we become, so don't shoot yourself in the foot okay?
So be careful out there. Things are going to be different. Trust me when I tell you appraisers don't kill deals, the market does and we have no vested interest in killing deals, we just have to report the facts. If you feel the appraised value is flawed you have recourse, just provide stats and fact to the bank and force them to order a new appraisal if it comes down to that. But it has to be proven to be a flawed appraisal, not just one that you may not agree with.....
Why Appraisers use Foreclosures
Comments (14)Subscribe to CommentsComment