Unique Historic Home Appraisal for Refinance

[grossmont art colony]

Thanks to everyone that has posted in response to my email. I think you have all given me some things to consider and some good approaches to use. The company that originally was on board for the refinance is the same one that originated my last loan, then sold it to Chase. If I can dig up the last appraisal, I may ask my mortgage broker if the same appraiser was among the ones that turned it down this time. I am pretty certain that they did not go to any extraordinary effort on the last appraisal despite the nature of the home. Since the home had previously been mortgaged for almost $900,000, I don't think the lender was too worried about underwriting it for ~$350,000; consequently the appraisal came in looking pretty similar to the purchase price.

In the meantime, I am going to:
1) Check with the company holding the current mortgage about getting a lower rate.
2) Talk to a realtor friend that lives in my neighborhood and specializes in the area. Hopefully she will have some advice about local banks or credit unions that I might be able to work with.
3) My credit union is based in Colorado and doesn't do mortgages in CA, but I will look into establishing a relationship with a local credit union to see if they might be able to refinance at the type of rates I am seeking.
4) I am not quite ready to dump my mortgage broker yet, as I think much of the current situation was driven by the very strict requirements of Provident. However, I am going to ask him about whether authorizing a more complex and expensive appraisal would have overcome the problems we had. I thought he had already indicated that we were pursuing a more complex appraisal than is normally required. I want more info on what really transpired.

 

[fractal7221]

A bank branch manager with less lending experience than some loan officer?

Wow...

Most branches managers have dozens of other products they have to know inside and out. The mortgage industry simply changes too fast to expect them to keep up on all the new requirements along with all their other products.

We have bought a few banks where the branch managers have done conventional mrtgages and its been a diaster every time. Nothing in the loan pipeline makes it through compliance.

 

[sail143]

As the others have said you should look to the local lender. The key is finding the lender who will hold your loan in their portfolio. In the past, to avoid the hassels of my loan being sold, I paid a one-quarter percent premiuim to be a portfolio loan. In this case your broker is likely not the answer.

 

[Bearslide]

It has been my experience that NONE of the big banks will lend on these type homes because they don't fit into neat little check boxes. Nor will any of the big banks be sending experienced appraisers - they all use AMCs who hire the cheapest, fastest - not the most experienced.

Provident has very narrow guidelines for loan acceptance PLUS they use a "blast" system for ordering through their AMC. Cheapest, fastest appraiser to hit the "accept button" gets the order.

Brokers typically do not work with the small, local banks or credit unions - there's no money in it for them. Brokers work on commission - and they are not necessarily working for what's best for you - they are generally working for what puts the most money in their pockets.

As others have said, your best bet is to go local, preferably with a bank or credit union who has the wherewithall to portfolio - AND who knows the market and has a direct order panel of experienced, knowledgeable appraisers.

I completed a private appraisal on a very unique historic home 2 years ago, advising the owner that the appraisal could not be used for lending purposes, which he understood. This year, he attempted to refinance. He tried Bank of America, Wells Fargo, Chase, Citi. ALL sent out inexperienced appraisers through their AMCs, despite the fact the owner was very clear upfront what type property he had. Not one of the appraisers could value the property because they didn't have a clue how to handle such a property. Then he tried several mortgage brokers and bankers - same result - they were all selling to the big boys.

He eventually went with a small local bank who could portfolio, finally understanding that he would have to pay slightly higher interest - and got the loan done in less than a month.

Bigger is NOT better, especially for unique homes.

Best of luck to you!

 

[gregb]

Pacific Western Bank is based in San Diego. I do not believe they use an AMC for their appraisals. All my dealings with their appraisal department have been positive.
http://pacificwesternbank.com/

 

[Terrel L. Shields]

A bank branch manager with less lending experience than some loan officer?

Wow...

NTEX...I believe you and I probably live in a part of the nation where the mortgage business is radically different from that of fractal's world. Until 1980s, 90% of our lenders were conventional banks and 15 year loans were max. The only exception was FHA and VA and most small banks never bothered with them. The occasional S & L was mostly in larger cities.

In the old days, the Branch Manager was a senior lender and likely was still an active loan officer in addition to managing the business end. They made the loan, they looked at the property, they valued the property or if it too complex they either gathered other LOs or the Loan committee together and looked at it, or in the rarest cases, they hired an appraiser.

Such LOs were conservative, some banks has guidelines that were as low at 50% on farm or commercial properties and none where the LTV was over 80%. They didn't consider S & Ls real banks. They didn't consider mortgage brokers or Loan originators as real bankers....and frankly, they were right. The banks should have remained single entities and Glass-Steagall should have never been dismantled.