Real Estate Analysis and Commentary.

FHA TO REQUIRE SECOND APPRAISAL FOR CERTAIN REVERSE MORTGAGES

WASHINGTON – The Federal Housing Administration (FHA) today announced that it will begin requiring lenders originating new Home Equity Conversion Mortgages (HECMs), commonly referred to as reverse mortgages, to provide a second property appraisal under certain circumstances. FHA is instructing lenders to provide a second independent property appraisal in cases where FHA determines there may be inflated property valuations.

For more reference:

https://www.hud.gov/press/press_releases_media_advisories/HUD_No_18_111 


Posted in:General and tagged: FHA
Posted by Wayne Henry on October 3rd, 2018 2:37 PMLeave a Comment

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CoreLogic: Mortgage fraud risk spiked in the second quarter.
 
There was a 12.4% year-over-year increase in fraud risk in Q2

There was a significant increase in mortgage fraud risk at the end of the second quarter of 2018, according to Corelogic’s latest Mortgage Application Fraud Risk Index. According to the Mortgage Fraud Report, there was a 12.4% year-over-year increase in fraud risk at the end of the second quarter of 2018.
The Mortgage Fraud Report analyzes the collective level of loan application fraud risk experienced in the mortgage industry each quarter.
 
See more: https://www.housingwire.com/articles/46820-corelogic-mortgage-fraud-risk-spiked-in-the-second-quarter


Posted in:Mortgage and tagged: Fraud
Posted by Wayne Henry on September 19th, 2018 2:01 PMLeave a Comment

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Severe appraiser shortage hurting market

Aug. 6, 2018

By Mortgage Daily staff

A severe shortage of real estate appraisers has North Dakota officials making a request to waive appraisal reports, at least temporarily, on some residential loans. Banking regulators see the move as necessary.

In some parts of the state, appraisal are reportedly taking up to three months. As a result, some of the transactions have fallen through -- hurting timely credit availability for prospective borrowers and slowing economic development.

A 
joint request was made by North Dakota Gov. Doug Burgum, Department of Financial Institutions Commissioner Lise Kruse and the North Dakota Bankers Association to the Federal Financial Institutions Examination Council's Appraisal Subcommittee.

A temporary waiver of appraisal requirements that are currently required by North Dakota law is being sought by the state for federally related real estate mortgage loans issued by banks or credit unions.

North Dakota law requires independent evaluations regardless of the transaction amount. Federal requirements allow appraisals to be waived on single-family loans up to $250,000.

The state is asking for a temporary waiver on residential loans up to $500,000.

John Ryna, president and chief executive officer of the CSBS, noted in a written statement, "The challenges experienced by lenders obtaining timely appraisals is impacting local communities and economic development nationwide. The fact that North Dakota's governor, top financial regulator and banking community are raising it to the federal level sends an extremely important message that there is a problem in the marketplace."

Reference: http://www.mortgagedaily.com/stories/North-Dakota-Appraisals-080618MBA.asp


Posted in:General
Posted by Wayne Henry on August 15th, 2018 5:52 PMView Comments (1)

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Fannie Mae is discontinuing the use of Form 1004MC (Market Conditions), the government-sponsored enterprise announced July 30 at the Appraisal Institute Annual Conference in Nashville, Tennessee. The GSE is expected to officially announce the change when it releases its updated Selling Guide in the coming weeks. 
 
Form 1004MC was released in November 2008, and from the start many appraisers said they found its use inappropriate for many market situations and conditions. Members of the AI Government Relations Committee expressed this opinion to Fannie Mae during recent discussions on ways the GSE could improve its policies and procedures. 
 
Reporting market trend activity will remain an important undertaking for appraisers and they will continue to do so even without the requirement to complete Form 1004MC. 
 
Freddie Mac has yet to make a similar announcement about discontinuing use of 1004MC, but the move by Fannie Mae may compel a similar policy change to maintain competitive posture. 
 
AI will monitor the situation and report new developments when they are announced. 

Posted in:General and tagged: Fannie Mae
Posted by Wayne Henry on August 7th, 2018 10:06 AMLeave a Comment

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Posted in:General
Posted by Wayne Henry on July 2nd, 2018 3:16 PMLeave a Comment

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Zillow, The First “Agent Management Company” (AMC) for the Real Estate Agent

 

Brokers and Agents, welcome to the appraisal world. Zillow is the first “Agent Management Company” (AMC) for your side of the Real Estate Industry. Yes you read that correctly. Zillow’s actions have many similarities to Appraisal Management Companies, so it is fair to say, they are the first “Agent Management Company”

 

“Zillow is hurting the people you are licensed to protect”

 

Doesn’t that sound very familiar to what appraisers have been saying about Appraisal Management Companies?  On the website www.stopzillow.com, Greg Hague, a Real Estate Attorney, Broker and Huffington Post writer, describes Zillow’s actions as “deceptive, defective, and a glorified lead gen scam.” 

 

According the website, Zillow’s “Instant Offers” helps sophisticated investors buy homes from unknowledgeable consumers at thousands below market.   In contrast, Appraisal Management Companies have been selling appraisals to unknowledgeable consumers, hundreds above market.

 

According to the website, Zestimates have misled consumers for years regarding their homes value. Zillow continues the program as they profit from the sale of leads back to the agent. In contrast, Appraisal Management Companies have misled lenders on the value of their services. They continue as they profit from taking a percentage of the appraisers fee.

 

And the kicker in all of this, the website is a petition for the National Association of Realtors to take a stand and force Zillow to stop. It has over 33,000 signatures.  In contrast, Appraisers have been asking the Appraisal Institute and National Association of Realtors to take a stand and put a stop to Appraisal Management Companies abuses.

 

And now we have silence from the two largest National Trade Organizations…..

 

In the article  Zillow Doesn’t Even Own the Photos it Threatened to Sue a Popular Blogger Over  by Nilay Patel, posted on theverge.com on 06/27/2017, Zillow attempts to brow beat an independent blogger for copyright infringement for photos they do not even own. In contrast, The FTC, encouraged by AMC’s, filed action against the Louisiana Real Estate Appraisal Board for enforcing The Dodd-Frank Federal Law. 

 

There is a quote on the website www.stopzillow.com by Margaret Mead,

 

“Never doubt that a small group of thoughtful

committed citizens can change the world;

 indeed, it’s the only thing that ever has.”

 

 

Join your state coalitions.  Make a difference in your future.

 

Please share this with your Brokers and Agents. 


Posted by Virginia Coalition of Appraiser Professionals on July 9th, 2017 11:23 PM

Posted in:General and tagged: Zillow
Posted by Wayne Henry on March 27th, 2018 1:49 PMLeave a Comment

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WASHINGTON - The Federal Housing Administration (FHA) today announced it is reversing a short-lived policy announced in July of 2016 and will no longer insure new mortgages on properties that include Property Assessed Clean Energy (PACE) assessments. Read FHA's mortgagee letter.

FHA's decision is part of a larger effort to protect the health of its Single Family Mutual Mortgage Insurance Fund (MMIF) and the borrowers who rely upon it. Last month, FHA released its latest annual report on the fiscal health of the MMIF finding the Fund had a total economic net worth of $25.6 billion and the Capital Ratio that remains above the statutory minimum for a third straight year. Read more about FHA's FY2017 Annual Report.

"FHA can no longer tolerate putting taxpayers at risk by allowing obligations like these to be placed ahead of the mortgage itself in the event of a default," said U.S. Housing and Urban Development (HUD) Secretary Ben Carson. "Assessments such as these are potentially dangerous for our Mutual Mortgage Insurance Fund and may have serious consequences on a consumer's ability to repay, or when they attempt to refinance their mortgage or sell their home."

FHA is also very concerned about PACE obligations being placed on FHA-insured mortgages that are already outstanding. The post-endorsement placement of these assessments on an FHA-insured mortgage creates a lack of transparency making it difficult for the agency to understand the true nature of the risks involved. In addition, such activity is risky for FHA borrowers and potentially violates the terms of their FHA-insured mortgage. FHA intends to monitor this carefully to determine whether further action is warranted.

Reference - https://www.hud.gov/press/press_releases_media_advisories/2017/HUDNo_17-111


Posted in:General and tagged: FHAHUD
Posted by Wayne Henry on March 27th, 2018 1:46 PMLeave a Comment

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Posted in:General
Posted by Wayne Henry on March 20th, 2018 9:51 AMLeave a Comment

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February 15th, 2018 3:53 PM

Homeowner Rejects Hybrid Appraisal

Appraiser Alert: Don’t Mess with a 4’ 10” Senior Citizen!

Last week I called a borrower to schedule the appraisal appointment. She asked me some very odd questions; “Are you a licensed appraiser? What is your license number? How can I verify this information?” Well I had never been asked any of these questions in my entire career, but I answered as there really wasn’t anything I was hiding.

It was 19 degrees outside when I arrived at the property and this senior citizen, not more than 4 feet 10 inches tall...

http://appraisersblogs.com/senior-citizen-homeowner-rejects-hybrid-appraisal


Posted in:Hybrid Appraisal and tagged: Hybrid
Posted by Wayne Henry on February 15th, 2018 3:53 PMLeave a Comment

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A community bank in Tennessee has submitted a request to the Appraisal Subcommittee seeking a one-year waiver from appraisal regulation requirements to use a certified appraiser, the Appraisal Institute learned Nov. 29. If the waiver is approved, it would apply to all institutions, not just the requesting organization.

The party making the request must provide clear evidence of a shortage of appraisers, among other things, and demonstrate that the shortage is leading to significant delays in the performance of an appraisal.

Read more here:

https://www.appraisalinstitute.org/ano/bank-request-for-appraisal-waiver-has-huge-implications/


Posted in:PIW and tagged: appraisalBankPIWWaivers
Posted by Wayne Henry on December 13th, 2017 1:54 PMLeave a Comment

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