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We don't need no stinking appraisers!

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by Mikey Flair, Mar 11, 2009.

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  1. Mikey Flair

    Mikey Flair Sophomore Member

    0
    Jul 5, 2008
    Professional Status:
    General Public
    State:
    Florida
    [FONT=Arial, Helvetica, sans-serif]Fannie Mae Eases Appraisal Requirements; Too Early to Assess Impact
    [FONT=Arial, Helvetica, sans-serif] Starting April 4, Fannie Mae will no longer require appraisals or property inspections from some borrowers who are refinancing mortgages. Instead, Fannie Mae’s Desktop Underwriter system will validate property values through automated valuation models. The new requirements most typically apply to existing appraisals on file and for loans that already contain risk for Fannie Mae.

    Under the new guidelines, lenders will be required to enter an estimated value of the house, which would then be compared with an estimate from an automated valuation model. If the two values are comparable, Fannie Mae will grant the borrower an appraisal waiver. If the two are not comparable, it will trigger an appraisal requirement.

    Fannie Mae also reduced some eligibility requirements for its Desktop Underwriter Refi Plus program. Borrowers with loan-to-value ratios of 80 percent or less will no longer be subject to a minimum credit score of 580 and adjustable-rate mortgage holders with loan-to-value ratios of 80 percent or less will no longer be subject to a minimum credit score of 680.

    Fannie Mae representative Brian Faith said the changes would let “potentially millions of current mortgage holders” take advantage of low interest rates currently available. However, Derek Chen, an analyst at Barclays Capital Inc., believes the changes will have a minimal impact, only amounting to the automation of existing underwriting standards. According to Carla Bandy, a senior underwriter at Everett Financial, it is too early to determine the impact the changes will have. “If you have a Fannie loan and are trying to refinance, there’s probably a comfort level because they already have you in a loan and you’ve made your payments,” said Bandy. “I don’t know if our investors will go along with that because they often put on their own overlays [in addition to what Fannie Mae requires].”
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  2. LACKLAND27

    LACKLAND27 Senior Member

    0
    Mar 6, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
    More good news for the appraisal industry. I can only hope it all blows up in the their faces, since this time they won't have us to blame!
     
  3. Cliff

    Cliff Sophomore Member

    0
    Jun 7, 2006
    Professional Status:
    Licensed Appraiser
    State:
    California
    Are you kidding me..........
     
  4. George Hatch

    George Hatch Elite Member

    198
    Jan 15, 2002
    Professional Status:
    Certified General Appraiser
    State:
    California
    This has been around for a while, ya?

    I don't know about other regions, but in my region the policy is meaningless. Struggling borrowers in this region who have LTVs of 80% or less of what an AVM would support are fewer than hen's teeth. Moreover, I reckon most of the secondary market investors have their own ideas about due diligence right about now.
     
  5. Don Clark

    Don Clark Elite Member

    15
    Jan 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Virginia
    Same here George. Ever since that waste of paper came out I have busier than a 1 legged tap dancer. Averaging 2-3 orders a day. not bragging, just hope to hell it keeps up.
     
  6. Terrel L. Shields

    Terrel L. Shields Elite Member
    Gold Supporting Member

    447
    May 2, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Arkansas
    They are backed by the taxpayer now. They don't need to worry about risk as long as they can afford lobbyists.
     
  7. TJSum

    TJSum Elite Member

    4
    Nov 12, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Maryland
    If they have not been scared straight by now, I doubt if they will ever see the light. But I agree with the others, the investors will have the final word on this.
     
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