More Projected Delays In The Real Estate Transaction
There are many changes within the Fannie Mae and Freddie Mac guidelines which are causing some confusion in the Real Estate and Finance Industry. Let's see if this brief list will help clear up some common questions or concerns.
Lenders must now provide appraisers a copy of the sales contract and all associated addendums. If a change is made to the purchase contract, the appraiser must be notified and updated paperwork made available.
Appraisals that only value a portion of a parcel are forbidden. The comparative market analysis by the appraiser has to include the entire parcel of the subject property or parcel of land. The key word here is "entire".
Appraisers in the past were omitting comparable sales of foreclosed homes, REO properties and short sales. The new Fannie Mae and Freddie Mac guidelines require these types of properties MUST be included in the market value of the property. This could definitely have a negative impact on our housing market.
You would think "common sense" would be considered in any new rules or guidelines. Here is another new guideline that is mandatory. If the appraiser has any financial interest in the transaction, the appraisal has to be verified by a third party who is "arms-length" from the transaction.
Any major repairs have to be considered in the appraisal. Now what a brilliant idea! The appraisal cannot be completed until these repairs are finished. Anyone ever heard of the FHA 203K loan?
Supervisory authorities can no longer sign off on completed appraisals without reviewing the subject property themselves. The supervising appraiser has to personally review the property before agreeing to sign off on an appraisal completed by one of their employees.
Since this downturn in the real estate market, the Home Valuation Code was amended to cease "favoritism" or the "influence" of market values. Protecting the consumer was also taken into consideration. These are positive changes but I still foresee this putting a damper on the timeline that it takes to close a transaction. - 16931
Lenders must now provide appraisers a copy of the sales contract and all associated addendums. If a change is made to the purchase contract, the appraiser must be notified and updated paperwork made available.
Appraisals that only value a portion of a parcel are forbidden. The comparative market analysis by the appraiser has to include the entire parcel of the subject property or parcel of land. The key word here is "entire".
Appraisers in the past were omitting comparable sales of foreclosed homes, REO properties and short sales. The new Fannie Mae and Freddie Mac guidelines require these types of properties MUST be included in the market value of the property. This could definitely have a negative impact on our housing market.
You would think "common sense" would be considered in any new rules or guidelines. Here is another new guideline that is mandatory. If the appraiser has any financial interest in the transaction, the appraisal has to be verified by a third party who is "arms-length" from the transaction.
Any major repairs have to be considered in the appraisal. Now what a brilliant idea! The appraisal cannot be completed until these repairs are finished. Anyone ever heard of the FHA 203K loan?
Supervisory authorities can no longer sign off on completed appraisals without reviewing the subject property themselves. The supervising appraiser has to personally review the property before agreeing to sign off on an appraisal completed by one of their employees.
Since this downturn in the real estate market, the Home Valuation Code was amended to cease "favoritism" or the "influence" of market values. Protecting the consumer was also taken into consideration. These are positive changes but I still foresee this putting a damper on the timeline that it takes to close a transaction. - 16931
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posted by Edgar at
02:08
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