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Pmi Pressure, Here We Go Again

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Bobby Bucks

Elite Member
Joined
Jan 27, 2002
Professional Status
Real Estate Agent or Broker
State
North Dakota
Is anyone else experiencing pressure regarding current refis and the PMI ratio? I'm seeing a lot of it for conventional, but especially for FHA purchases in the last couple years. Just because mortgage rates are lower, it seems we're supposed to manufacture appreciation. When a borrower purchased a cookie cutter one year ago for $100,000 it's supposed to be $125,000 today so there will be no PMI.
 
Joined
Jan 16, 2002
Yes. It's the perception of reality v. reality. Our market is based upon rumors and wishful thinking. The reality of current market is DECLINE. On every deal I check past 12 month period (my own reality check) . The last 6 months are always lower than the first. Meanwhile RE agents are still boosting asking prices (by at least 20% above anything that has sold), deals are dropping like flys, and the old battle axes (RE agents) are screaming bloody murder along with property owners. It's going to be a repeat of the late 80's and early 90's. I'm building the walls around the office higher and installing extra gun turrets.
 

Wally Jones

Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Yep, have seen a big push. I think it's the result of the lenders expanding their marketing approach due to the fact that over the past year they've just about exhausted the refi market with the low rates. It's a mystery where they get their "appreciation" figures from. But they sure aren't shy about passing that to the homeowner! By the time I get there, Mr. and Mrs. owner have already been shopping for the new swimming pool/room addition/furniture!

Then when the lender gets the report......yikes! My fault, of course. I just don't seem to use the same arithmetic as that nice loan officer. Sigh.
 

Ben Vukicevich SRA

Senior Member
Joined
Feb 9, 2002
Professional Status
Certified General Appraiser
State
New Jersey
Bobby,

PMI pressure a'int bad. The new thing is the 70% LTV ratio the LO's want on cash out refi's so they don't have to charge the extra .5% on the rate.

Ben
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
Did a PMI in March, didn't make the ratios. Got a call yesterday from the AMC. Borrower says market is appreciating. Can you increase the value?

"Nope. Got a number of paired sales showing a 7% decline over last 12 months. It's going down, not up."

What's worse is the guy who bought a new home last year who want to refi. I have to tell them it's lost 5-10% since the builder is still in the market.

Roger
 

Bobby Bucks

Elite Member
Joined
Jan 27, 2002
Professional Status
Real Estate Agent or Broker
State
North Dakota
Clarification. I was not referring to PMI drop requests...that's another complaint area. I was referring to refis where the borrower is currently paying PMI and their all caring LO applies the pressure to keep their client from paying it on the new loan.....even if they only bought the house 6 months before.
 
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