Comments on: Wholesalers Lenders Start Using AMC’s to Ensure Appraiser Independence http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/ Reverse Mortgage News and Information Mon, 13 Feb 2012 00:19:00 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: El http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-38216 El Tue, 29 Jun 2010 23:48:00 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-38216 I have a question. I was considering building a custom home, which I couldn't afford with a conventional mortgage. I was told by the builder that since I am over 62 and have no heirs, a reverse mortgage would work well for me to pay off this new home. The bulder said that the appraised value would increase between the construction loan and the mortgage, so the lump sum from a reverse mortgage would pay off the home. I'm not convinced that a reverse mortgage was designed to buy something one can't otherwise afford and I decided not to go ahead because it all seemed too risky for my retirement, but I haven't been able to find out the answer to my basic question. Is it true that the appraised value of a custom built home automatically increases between the start of the construction loan and the conversion to a mortgage? I have a question. I was considering building a custom home, which I couldn’t afford with a conventional mortgage. I was told by the builder that since I am over 62 and have no heirs, a reverse mortgage would work well for me to pay off this new home. The bulder said that the appraised value would increase between the construction loan and the mortgage, so the lump sum from a reverse mortgage would pay off the home. I’m not convinced that a reverse mortgage was designed to buy something one can’t otherwise afford and I decided not to go ahead because it all seemed too risky for my retirement, but I haven’t been able to find out the answer to my basic question. Is it true that the appraised value of a custom built home automatically increases between the start of the construction loan and the conversion to a mortgage?

]]> By: El http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-37619 El Tue, 29 Jun 2010 21:48:38 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-37619 I have a question. I was considering building a custom home, which I couldn't afford with a conventional mortgage. I was told by the builder that since I am over 62 and have no heirs, a reverse mortgage would work well for me to pay off this new home. The bulder said that the appraised value would increase between the construction loan and the mortgage, so the lump sum from a reverse mortgage would pay off the home. I'm not convinced that a reverse mortgage was designed to buy something one can't otherwise afford and I decided not to go ahead because it all seemed too risky for my retirement, but I haven't been able to find out the answer to my basic question. Is it true that the appraised value of a custom built home automatically increases between the start of the construction loan and the conversion to a mortgage? I have a question. I was considering building a custom home, which I couldn't afford with a conventional mortgage. I was told by the builder that since I am over 62 and have no heirs, a reverse mortgage would work well for me to pay off this new home. The bulder said that the appraised value would increase between the construction loan and the mortgage, so the lump sum from a reverse mortgage would pay off the home. I'm not convinced that a reverse mortgage was designed to buy something one can't otherwise afford and I decided not to go ahead because it all seemed too risky for my retirement, but I haven't been able to find out the answer to my basic question. Is it true that the appraised value of a custom built home automatically increases between the start of the construction loan and the conversion to a mortgage?

]]> By: Retired Appraiser http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-37300 Retired Appraiser Tue, 25 May 2010 18:12:41 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-37300 As predicted we are beginning to get a glimpse of the HVCC program; a double dip into recession led by another housing slump. It's not like we couldn't predict it. Run experienced appraisers out of the business and rely solely upon freshly trained experienced appraisers who have never seen a recession much less a major housing decline.<br><br>I hate to say I told you so but I've been predicting this for over a year. Enjoy your new recession Andrew. It's only a matter of time before it's traced back exclusively to your greedy little scam. As predicted we are beginning to get a glimpse of the HVCC program; a double dip into recession led by another housing slump. It's not like we couldn't predict it. Run experienced appraisers out of the business and rely solely upon freshly trained experienced appraisers who have never seen a recession much less a major housing decline.

I hate to say I told you so but I've been predicting this for over a year. Enjoy your new recession Andrew. It's only a matter of time before it's traced back exclusively to your greedy little scam.

]]> By: DaveGrady http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-35272 DaveGrady Wed, 23 Dec 2009 13:05:36 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-35272 Merry Christmas!!<br>Important FHA Changes<br><br>HUD is delaying Mortgagee Letter 209-28, Appraiser Independence until February 15, 2010. Mortgagee Letter 2009-28 was originally planned for January 1, 2010.<br>The original Mortgagee Letter has two parts: a) prohibition of mortgage brokers and commission-based lender staff from the appraisal process, and b) appraiser selection in FHA Connection.<br>The effective date for both sections of this Mortgagee Letter will now take effect for all case number assigned on or after February 15, 2020. This extention will provide FHA and lenders additional time to adjust systems to accommodate the changes.<br>Detailed instructions on changes to FHA Connection will be issued in a new Mortgagee Letter.<br><br> <br><br>In addition, HUD is delaying Mortgagee Letter 2009-51 which adopts the Appraisal Update and/or Completion Reports. The effective date will now apply to all case numbers assigned on or after February 15, 2010. Merry Christmas!!
Important FHA Changes

HUD is delaying Mortgagee Letter 209-28, Appraiser Independence until February 15, 2010. Mortgagee Letter 2009-28 was originally planned for January 1, 2010.
The original Mortgagee Letter has two parts: a) prohibition of mortgage brokers and commission-based lender staff from the appraisal process, and b) appraiser selection in FHA Connection.
The effective date for both sections of this Mortgagee Letter will now take effect for all case number assigned on or after February 15, 2020. This extention will provide FHA and lenders additional time to adjust systems to accommodate the changes.
Detailed instructions on changes to FHA Connection will be issued in a new Mortgagee Letter.

In addition, HUD is delaying Mortgagee Letter 2009-51 which adopts the Appraisal Update and/or Completion Reports. The effective date will now apply to all case numbers assigned on or after February 15, 2010.

]]> By: DaveGrady http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-35271 DaveGrady Wed, 23 Dec 2009 12:02:08 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-35271 Good appraisers will walk away from HVCC and leave the culls who are already in there hurting seniors with bad valuations. The lender UWs are devaluing homestead property appraisals and violating the law while they do it. Seniors don't get to see the appraisal they paid for in most until the closing which prevents them from making clear decisions on whether the reverse is a good thing for them. Add to that the huge number of seniors who will walk away from reverse because they cannot pay for an upfront appraisal cost (a discriminatory policy) and it becomes an unworkable process. Every LO/Broker and Appraiser needs to be screaming at the top of his/her lungs to their congressional folks that they have lost their vote until this thing is fixed. You'd think the media would have picked up on this months ago. Good appraisers will walk away from HVCC and leave the culls who are already in there hurting seniors with bad valuations. The lender UWs are devaluing homestead property appraisals and violating the law while they do it. Seniors don't get to see the appraisal they paid for in most until the closing which prevents them from making clear decisions on whether the reverse is a good thing for them. Add to that the huge number of seniors who will walk away from reverse because they cannot pay for an upfront appraisal cost (a discriminatory policy) and it becomes an unworkable process. Every LO/Broker and Appraiser needs to be screaming at the top of his/her lungs to their congressional folks that they have lost their vote until this thing is fixed. You'd think the media would have picked up on this months ago.

]]> By: ahm111677 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-35265 ahm111677 Wed, 23 Dec 2009 03:44:30 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-35265 I am an appraiser for 15 years now. This is the worst I have ever seen this business. About 3/4 of my work is from management companies now. The pay is horrible. I am a father of 4 little children, and am being greatly impacted by all of this. HVCC should be completely reversed. There just needs to be tougher licensing requirements. I see probably 2-3 reviews a week, and usually 1-2 are terrible reports. There are a lot of bad appraisers out there, but this is not the way to get rid of them. A friend of mine who is a loan officer asked me to look into this property for him. Through their management company, the appraiser valued the house at 340k. He did not even use a comp that sold on the same block that was smaller, and sold recently for 380k. The house was underappraised, and now they are stuck and it is a dead deal. Meanwhile the homeowners don't know what to think. HVCC is killing this business. I am an appraiser for 15 years now. This is the worst I have ever seen this business. About 3/4 of my work is from management companies now. The pay is horrible. I am a father of 4 little children, and am being greatly impacted by all of this. HVCC should be completely reversed. There just needs to be tougher licensing requirements. I see probably 2-3 reviews a week, and usually 1-2 are terrible reports. There are a lot of bad appraisers out there, but this is not the way to get rid of them. A friend of mine who is a loan officer asked me to look into this property for him. Through their management company, the appraiser valued the house at 340k. He did not even use a comp that sold on the same block that was smaller, and sold recently for 380k. The house was underappraised, and now they are stuck and it is a dead deal. Meanwhile the homeowners don't know what to think. HVCC is killing this business.

]]> By: rmguy http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-35194 rmguy Thu, 17 Dec 2009 20:24:31 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-35194 This will not work for all the valid reasons listed above. In four years doing RM's I have only had 4 deals fall apart due to under-appraisal...all with AMC's...all with the same "Top 5 " lender. I will leave the business before I will turn my financial future over to an appraiser who discount a fee by 50% just to find work. <br><br>This is causing a downward spiral of valuations further compounding the collapse of home values. Congress knows this and if the bureaucrats can't fix it they will rewrite the rule themself. This will not work for all the valid reasons listed above. In four years doing RM's I have only had 4 deals fall apart due to under-appraisal…all with AMC's…all with the same “Top 5 ” lender. I will leave the business before I will turn my financial future over to an appraiser who discount a fee by 50% just to find work.

This is causing a downward spiral of valuations further compounding the collapse of home values. Congress knows this and if the bureaucrats can't fix it they will rewrite the rule themself.

]]> By: The_Cynic http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/comment-page-2/#comment-35104 The_Cynic Mon, 14 Dec 2009 07:02:30 +0000 http://reversemortgagedaily.com/2009/12/10/wholesalers-lenders-start-using-amcs-to-ensure-appraiser-independence/#comment-35104 -M-,<br><br>Please we are not a bunch of simpletons. For years some lenders had their own appraisal departments or units. Usually they were in “captive” affiliated corporations.<br><br>Price is based on what the market will bear. It is not a matter of static or non-static prices. This is simple Econ 101.<br><br>You and I were in two different housing bubbles. If all the “lawlessness” was a simple matter of overvalued appraisals, we never would have seen a housing bubble. The real problem was a drop in lending standards. Borrowers were showing inflated income and lower expenses while lenders were lowering the minimum ratio requirements on mortgage payments to income and introductory rates on ARMs became ridiculous. Stated income and stated assets were the rule of the day.<br><br>If inflated home values were the primary problem, then the mortgage payments would have been higher and higher and no one could afford the loans. <br><br>Do you really think it is right to string a senior along just to see if an appraiser will come up with the needed value? Some seniors do not have the money to pay for counseling. It is obvious you do not work with borrowers. They are desperate and too many times believe their homes are worth a lot more than they are.<br><br>Please remember, these changes are intended to reduce FHA risk not "help" the industry. Many of us believe this is a move in the wrong direction. The cost of a middleman is a real cost. -M-,

Please we are not a bunch of simpletons. For years some lenders had their own appraisal departments or units. Usually they were in “captive” affiliated corporations.

Price is based on what the market will bear. It is not a matter of static or non-static prices. This is simple Econ 101.

You and I were in two different housing bubbles. If all the “lawlessness” was a simple matter of overvalued appraisals, we never would have seen a housing bubble. The real problem was a drop in lending standards. Borrowers were showing inflated income and lower expenses while lenders were lowering the minimum ratio requirements on mortgage payments to income and introductory rates on ARMs became ridiculous. Stated income and stated assets were the rule of the day.

If inflated home values were the primary problem, then the mortgage payments would have been higher and higher and no one could afford the loans.

Do you really think it is right to string a senior along just to see if an appraiser will come up with the needed value? Some seniors do not have the money to pay for counseling. It is obvious you do not work with borrowers. They are desperate and too many times believe their homes are worth a lot more than they are.

Please remember, these changes are intended to reduce FHA risk not “help” the industry. Many of us believe this is a move in the wrong direction. The cost of a middleman is a real cost.

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