Proposal: Fewer Homes Would Require In-Person Appraisals

Federal housing officials are proposing an idea to reduce the number of homes requiring in-person appraisals to help save home buyers hundreds of dollars and speed up the process.


The proposal would raise the threshold for in-person appraisals from homes costing $250,000 to $400,000.  Mortgage brokers call it an awful idea, saying if they're going to shell out money to someone,they want a human being to inspect that property.


“When the appraiser walks up to the house and your neighbor has an 18-wheeler parked in the front lawn, is that going to affect the value?  Absolutely.  But did the computer see that?  Nope,” says Houston realtor Michael Weaster with Berkshire Hathaway Real Estate.


“It can tell you the value of the home based on Comp A, Comp B, Comp C,”he says.  “But at the end of the day houses are unique and there are different aspects of each property, and the appraiser when they physically see them, that's the only way he can determine whether or not this has a different value of what the computer is saying.”


The proposal would exclude any loans sold or guaranteed by the U.S.government, such as FHA, HUD or those from Fannie Mae and Freddie Mac.  It could take months, if not years, to be approved.


“Lenders,realtors, other folks who are in the industry could potentially defraud the mortgage companies and that's what got us into trouble with subprime lending to begin with,” says Weaster.

 

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