FYI- Land/Manufactured Home Sales

[Tim Hicks (Texas)]

It seems that many appraisers continue to use land/manufactured home package sales in their reports (judging by the reviews I am doing). I thought I would post the link to the site at the Texas Appraiser's Licensing Board that specifically addresses what "exposed to the open market" sales really are.

Here it is: http://www.talcb.state.tx.us/pdf/assemblage-1201.pdf

 

[Jo Ann Meyer Stratton]

Also, everyone find Fannie Mae's new selling guidelines that go into effect June 30, 2002, Part XI-Property and Appraisal Guidelines, Section 304-Factory-Built Housing.

"The appraiser must not "create" comparable sales by combining vacant land sales with the contract purchase price of the home (although he or she may use this type of information as additional supporting documentation). If the appraiser is unable to develop a reliable appraisal based on at least two comparable sales of similar manufactured homes, the mortgage is not eligible for delivery to us.

Also be sure and read Section 103-Refusal to Accept Certain Appraisals

"From time to time, we may refuse to accept appraisals prepared by specific appraisers or we may notify a lender that we will no longer accept appraisals prepared by a given appraiser.

We may also refer unacceptable appraisal reports to the appropriate state appraiser licensing or regulatory boards for investigation and action."

Lots of interesting items in the new selling guidelines. Check it out. By the way those guidelines would be very helpful and informative for an inexperienced appraiser to read. Although it is very helpful to us old people too! A person is never too old to learn!

 

[Tim Hicks (Texas)]

Please note that Jo Ann is quoted in the article and I consider her the EF Hutton of MH appraisals.

Freddie Mac is currently in the process of removing certain appraisers from their approved list for any properties that they appraise. It will be alarmingly difficult to conduct an appraisal business when you are inelligible for Fannie or Freddie loans. This process is under way for many, many appraisers across the nation and some well derserving appraisers in my area.

The amount of fraud and incompetence in this type appraisal work is so alarmingly high, that Fannie and Freddie are actually going to act on it. It is even more pitiful if you do REO work and you see the results of these bogus loans. Use a little common sense people. How can a manufactured home be worth more than site built homes (brick,slab, garages, etc) in the same area? The answer is... they are not!

If you truly do market research, the truth is easy to see. A sea of "victimized home owners" does not create market value. Our jobs are to compare the homes to "open market" transactions. If they are really worth what they are sold for, there should be plenty of "verifiable" sales to support the value. Hand selected dealer comps with questionable verification sources that don't correspond to the rest of the market should be a definite red flag. If all these homes sold for such high prices in the past five years, don't you think there would be some re-sales that support these values somewhere? If you can't sell it for what you paid for it one to two years later and you are upside down in the property, do you think that maybe it wasn"t worth that much in the first place? Wouldn't you want to sue the appraiser who said it was? I would. Aren't we supposed to be the unbiased party that protects the lender and the home owner?

Nuff Said.

 

[Pamela Crowley (Florida)]

Right on Tim and Jo Ann

Now we'll see if Freddie & Fannie really mean it.