glenn walker
Elite Member
- Joined
- Oct 11, 2006
- Professional Status
- Certified Residential Appraiser
- State
- California
Most lenders only use the waiver because the home's market value was calculated fairly recently and when the market has been either very steady or better yet on one that has gone up significantly in the last 36 months. Thats when an- in-person valuation estimate make the underwriting process more efficient for both the borrowers and the lender. Example: My City has been increasing for over 5 years or longer and even the worst of the worst has increased by 50% over that time period and homes in good condition are up in just 6 months by 25% or more. Also mots of these are already in the CU Systems data bank so there is no reaosn to send an-appraiser out on a home that had either been purchased or refinanced in the last 36 months. I have pulled up every refinance appraisal i have completed in 2018-2019 & 2020 and out of those about 75% had been done with waivers and by the same lenderFannie Mae does not warrant that the estimated value provided by the lender is the actual value of the subject property. The lender may not make any statements to any third party (including the borrower) that Fannie Mae performed any kind of review, appraisal, or valuation of the property.
We also ran comparables on about 15 of them just to see what value differences between the last time we appraised them and what they are worth now. All of those values were 20% to 50% higher and all were minimum C-4 and many C-3 when I had completed them. I then ran the AVM and even looked at zillow and MLS because these were all cookie cutter non-complex homes where a monkey could estimate a value at +/-5% to 10%.
My final analysis concluded that there was very little to no risk using waivers as long as that persons financials were good. So as a Lender I would be crazy to order a full appraisal because not only can I shave off 5 to 7 days off to funding but I also have a customer and borrower who is much happier with their overall loan experience. The only person who suffered was me because back in the day i would have gotten orders on many of them and they were easy money since I had the building sketches and most vital information in my files. All I would have needed was six new comps and Bingo easy money. ( Note: I have not seen any waivers on Complex or Rural properties unless they were rate and term or very limited 5% type cash outs So apparsiers fighting waivers juts need to be honest and admit its not that they care about the Lender or GSE'S risk and its not because they are concerned about a borrower or buyer over-paying recuse truth is the "Appraisers" value will-usually be higher than what the waiver allowed and therefore- the appraiser-brings no value to the table.
The "appraisers argument is maybe the homes physical condition has changed since the last appraisal but that is mostly not valid because the "Borrower" has the option of getting a full interior exterior-if they believe the waiver is too low and not reflecting those upgrades. As far as a lower physical condition the typical loan production appraiser rarely makes a condition between a C-3 and C-4 of 5% to 10% on the high side. A C-5 or C-6 was never even funded until it had been brought up to a minimum C-4 so that's not even a valid argument.
Boys and Girls -Unless you have something of value to sell its a long way to the top in rock and roll and technology will and is changing the game. You will survive just not on the same business model and this refinance boom has given many a false sense of security but remember almost-every appraisal you are doing right now is begin added into the Big-Green Machines data stripping operation and on the next transaction there will be a waiver and not you being sent out to do it again. Year 2023 -Hey MARGE-I just found out these dirt-bags are not using appraisers anymore to do REO or Pre-Foreclouser valuations that no good NAR and those no good Realtors are being used to see why the physical conditions and maybe Zillow partnered up with Fannie & Freddie because they already started buying homes by the thousands because they had all the data on which-homes where in forbearance or Pre-defaults and they just contact those folks pay full price and the owner gets his cash and now the agencies own in partnership ones that can be flipped or rented and professionally managed by the new Team Zillow. Hey Angry Cat is that a fact ? No Uncle Billy but thats how they did it with Black Rock back during the great mortgage meltdown and-so now they have the formula down to a tee . Hey Angry-Cat I think you are onto something how come we never get in thees deals ? Uncle Billy because we were overly negative and we thought Zillow and Corelogic where never going to amount to anything and thats why we missed Google-Tesla-Apple because technology had passed us bye. Uncle Billy -Yeah but we own rentals and land and you can never make any more dirt ! Uncle-Billy shut up they are working on synthetic dirt at 20% of the cost of real dirt so your 20 Acres will be worthless and we are like the guys who figured a horse was more reliable than some dang thing Henry Ford made and we missed that opportunity to : )
