Appraiser - Friend or Foe

Are you of the opinion that appraisers are killing deals and keeping the housing market in the dumps?

Many real estate agents, builders and lenders seem to think this.  This belief betrays a misunderstanding about what appraisers do.  Does the appraiser determine the value of the property?

If you said "yes" then you are among the misinformed.  It is the market that determines the value.  Appraisers simply report what the market has already decided.  If you disagree with a value conclusion and wish to dispute it, remember one simple thing.

Data is King!

The value is coming in low because that is what the data supports.  If you feel the value is unjustifiably low, provide the appraiser relevant, meaningful data that suggests otherwise.  Many real estate professionals have the belief they are not allowed to interact with the appraiser.  This is false.  You can be involved in the appraisal process as a data source.  Appraisers welcome any and all useful information you can provide.  

Treat the appraiser as an ally rather than an adversary and I guarantee you will see positive results.

Something other than bank clients.

Looking for something other than bank work?  Give your local real estate attorney a call.  Litigation assignments are often much more interesting and challenging...and not to mention they pay much better.

Recognize that big pay checks come with expectations.  Yes, the opposing attorney will try to make you look like a fool, but when the data is on your side, it's an easy argument.  The data speaks for itself.

What is the difference in fees you ask?  I'm happy to share.

I recently worked on a single-family residential property that, for mortgage lending purposes, would have commanded a fee of around $400.  However, for the condemnation intended use, the fee was over $9,000.  Not only was the client happy to pay the fee, I got a hug from the property owner for my efforts.

Home Loan Modifications Are Causing Foreclosures

Though the intent of home loan modifications is honorable, it is clear the system is broken.  Obama's making home affordable program was intended to help homeowner's avoid foreclosure. You can read about how the program was intended to work at makinghomeaffordable.gov.

If you decide to go for a loan modification.  Here is one piece of advice:  Somewhere along the process the lender will allow you to make a lower monthly payment while your application is being processed.  DON'T DO IT!  Keep paying your original amount unit you are actually approved.   Why you ask?  Isn't a lower payment the whole point?

Here is the reality,  it is highly unlikely you will get approved.  As many sources have pointed out, very few homeowner's are getting approval.  Like I said the system is broken.  So here is what is happening to many people attempting loan modification.  

They make application.  They are told they can make a lower payment while their application is being processed.  The lenders will take several months processing the application.  The lender will likely have a never ending list of needed paper work, that they will say they never received.  The lender will then deny the application on the grounds the homeowner never provided the needed paperwork in spite of the homeowner sending in the documentation two, three or even four times.

And guess what, since the application was denied, the difference between the original mortgage payment and the lower payment the lender told you to make while your application was in process is now treated as LATE PAYMENTS.  Since your application took 6 months to process (and be denied), you are now 6 months behind on your mortgage payment.   So if you can not come up with the cash to get current on your mortage (and chances are you don't since that is why you were applying for the modification in the first place) the lender now starts foreclosure proceedings.

So the program that was intended to help keep your home is actually causing you to lose it.