Data Cancer found....

[George Hatch]

The buyer in the $430k transaction apparently put $130k of their own money into it. The lender in that transaction is covered. Like it or not, that's all the due diligence THEY need for THEIR use. Telling them they need to stick to using 1004s as a means of limiting and regulating pricing increase/decrease in the market is going to be a non-starter.

How are appraisers going to go about handling waiver-financed transactions in their comps any differently than ARM financed sales or REO resales or cash sales or whatnot? After a certain point the sales financed by other than an appraisal will drive the market. Meanwhile, the appraiser's job remains getting to "most probable" in the current market conditions. Not trying to influence the market with their appraisals.

 

[J Grant]

The buyer in the $430k transaction apparently put $130k of their own money into it. The lender in that transaction is covered. Like it or not, that's all the due diligence THEY need for THEIR use. Telling them they need to stick to using 1004s as a means of limiting and regulating pricing increase/decrease in the market is going to be a non-starter.

How are appraisers going to go about handling waiver-financed transactions in their comps any differently than ARM financed sales or REO resales or cash sales or whatnot? After a certain point the sales financed by other than an appraisal will drive the market. Meanwhile, the appraiser's job remains getting to "most probable" in the current market conditions. Not trying to influence the market with their appraisals.

It's not a question of how appraisers handle waiver transactions for a comp (though that might be an element )

It is a matter that NOBODY, including appraisers, can track the effect of wavier purchases on market prices since the waiver is not disclosed.

WR lenders' due diligence for THIER use - it is not THEIR money at stake. It is the tax payer-backed monies at stake (our money ) with a WAIVER the lender receives relief from reps and warranties wrt the collateral value, ( no buyback obligation on the lender part for vale related as there is went they use an appraisal. )

 

[George Hatch]

The point I'm making is that whether appraisers know about the waiver or not it won't affect their value conclusions. Those sales still happened at those prices, and "seller concessions" or "non-cash financing" weren't of effect on those prices.

Heck, the GSE AVMs actually have access to which transactions were done with waivers. I don't know if they're using that access yet but my guess is that if not then it's only a matter of time until they do.

The argument COULD be made that WRT the financing the AVMs can see more than the appraisers can see. That is, unless the brokers decide to opt in to reporting the financing that was used in their closed sale listings.

 

[chad hampton]

Sure i would, if I see a waiver and it appears that it’s an anomaly, I won’t use it. If I see conventional, I assume there was an appraisal done and everyone was well informed.

same thing I do with cash in some cases. Cash sales are great to use when they’re in line with the market. Now, if three cash buyers come in, then maybe that does set the market.

Pretty hard to make the case that waivers aren’t juicing the market, but I commend you for trying.

 

[J Grant]

The point I'm making is that whether appraisers know about the waiver or not it won't affect their value conclusions. Those sales still happened at those prices, and "seller concessions" or "non-cash financing" weren't of effect on those prices.

Heck, the GSE AVMs actually have access to which transactions were done with waivers. I don't know if they're using that access yet but my guess is that if not then it's only a matter of time until they do.

The argument COULD be made that WRT the financing the AVMs can see more than the appraisers can see. That is, unless the brokers decide to opt in to reporting the financing that was used in their closed sale listings.

I am not talking about appraisers and their value conclusions. It could be a benefit but that was not my main point,

I am referring to the fact that nobody can track whether waivers are affecting market prices or not since they are not disclosed.

Why are you fine with that?

 

[J Grant]

The point I'm making is that whether appraisers know about the waiver or not it won't affect their value conclusions. Those sales still happened at those prices, and "seller concessions" or "non-cash financing" weren't of effect on those prices.

Heck, the GSE AVMs actually have access to which transactions were done with waivers. I don't know if they're using that access yet but my guess is that if not then it's only a matter of time until they do.

The argument COULD be made that WRT the financing the AVMs can see more than the appraisers can see. That is, unless the brokers decide to opt in to reporting the financing that was used in their closed sale listings.

And that magnifies the problem.

GSE AVMs will be using waivers in their sales comps blindly just as appraisers do.

If the GSEs identify the waiver sales for an AVM to use to separate them from appraisal-based sales - we are not privy to that. it would be hard to compare since most appraisals now are on problem child properties or higher risk buyers or specialty properties. Then appraiser financed sales would be marked asf being "higher risk"

 

[Dublin ohio]

Sure i would, if I see a waiver and it appears that it’s an anomaly, I won’t use it. If I see conventional, I assume there was an appraisal done and everyone was well informed.

So how do you identify a waiver since JG contends there is no way to do that

 

[George Hatch]

I am not talking about appraisers and their value conclusions. It could be a benefit but that was not my main point,

I am referring to the fact that nobody can track whether waivers are affecting market prices or not since they are not disclosed.

Why are you fine with that?

Ah, another dishonest reimagination of my commentary. I get it.

I'm all for more disclosure when compared to less disclosure. Never have I said or suggested otherwise on this or any other appraisal-related issue. I just don't think "waiver financed" disclosures in the listings will make a difference at the buyer/seller level. After all, that's where the contract prices are established; not in the appraisals.

 

[TerryRohrer]

While we are all clamoring for disclosure, why don't we also demand disclosure of appraised values. That will allow us to discern when buyers are buying the financing (FHA, VA, USDA) instead of the property, and when appraisers are rubber stamping contract prices. I suspect most who are demanding disclosures of waivers don't really want our end disclosed.

 

[George Hatch]

Some brokers already limit how much info they disclose in their listings or when talking to appraisers. I'm not sure what it would take for the listing services to compel the brokers to disclose financing terms in their listings.