When your lenders order an appraisal for HELOC.

[Randolph Kinney]

Hardly any AVMs or BPOs are being ordered these days. With rates going up no one will be refinancing they will be tapping equity through a HELOC. This is a huge opportunity for appraisers.

But they will mostly be Drivebys replacing an AVM. There will be lots of new desktop products too. Provided they are USPAP compliant these will be a great opportunity.

Appraisers seem to believe you must inspect. You don't. And the lender doesn't need you to.

Just did a short sale appraisal for FHA purchase. The lender set the selling price based upon a drive by BPO. The price was way over the as-is market value because it had extensive termite damage and no floor coverings.

I made the value subject to repair and remediation of the termites and damage based upon the visible damage along with the pest inspection report.

 

[Deleted member 128537]

It is strictly a business decision if you want to do exteriors. Quite a bit of my work right now. Typically HELOC appraisals are on properties that the owner has signficant equity in, are asking for a Line of Credit on, and they have excellent credit scores. I know some appraiser friends than never do them because they are concerned about accuracy. That's their decision. I understand that the SOW determines accuracy. But it seems they are giving up quite a bit of business. Good for me; bad for them.

Frankly if you want to minimize risk I woud say FHA and USDA loans are a heck of lot more risky of coming back to bite you. Those loans are often given to people that are the least credit worthy and if a loan is going to fail and an appraisal heavily scrutinized they would be the ones.

I use to do a lot of forensic reviews. They were never on good loans. Almost always on REO's.

 

[CANative]

I understand scope of work perfectly well.

I disagree...........

 

[Mike Garrett RAA]

There is an inherent risk for the appraiser in doing exterior only property inspections for appraisal purposes. Is it acceptable appraisal practice per USPAP? The answer is yes. Do I want to do appraisals in that manner? Most likely not.