Dear Appraiser, My Seller is not your enemy….
AN OPEN LETTER TO THE 2 APPRAISERS WHO SHOULD HAVE THEIR LICENSE REVOKED
First, I want to say to all the competent and professional appraisers I have had the pleasure of meeting and chatting with: You are a complement to your profession and we, as realtors, appreciate the hard work you put into your occupation.
Now, to the 2 appraisers who sent in mistake-riddled appraisals on a recent deal and NEARLY prevented my seller from selling, SHAME ON YOU! It’s not about you, it’s not about me, or the other realtor, or the mortgage co, etc. It’s about the Seller and the Buyer. Period. Their dreams, their goals, their aspirations…and yet you trample them without a moment’s thought (or so your appraisal made it seem).
I know you have taken a lot of heat over the market taking a dive. But that’s water under the bridge. It’s up to us to bring this market back and that’s only going to happen when good buyers and good sellers can complete a transaction.
When we met at the property, I brought both of you a brief synopsis of comparable properties and a quick opinion of value. Obviously, I knew (and expected) you would both do your own research but thought you would come close to my opinion. What happened??? Having lived in the neighborhood for 6 years and sold numerous homes in here, I am well aware of current values. In fact, 4 of the 6 comps you used in your appraisal were MY LISTINGS, yet you never called me for additional details on the homes. Ultimately, you made quite a few mistakes on the appraisal that required me to write a written appeal asking for corrections – but it was too late at that point.
Putting your incompetence aside, you wouldn't know that my seller lost his wife of 30 years about 18 months ago. He is battling cancer himself and his house was just too big and filled with too many memories of his soul mate. Not that you knew (but maybe deduced from public records), he was also bringing $50,000+ to the closing table to get the deal done. Ultimately, the home appraised as it should have – on the THIRD APPRAISAL - after 2 wildly inaccurate appraisals blew apart 2 different contracts. When you fail to complete your due diligence and sign off on that error-riddled appraisal, you are affecting people’s lives immeasureably.
If you are from across the Bay and unfamiliar with our area, why wouldn’t you take assistance from a “neighborhood expert”? Your terse response to my comps, “I’m not allowed to speak with you” is not quite accurate. Other appraisers have told me the law does allow you to consult with experts in the area to arrive at a reasonable fair market value. Just because a bank orders the appraisal from you doesn’t mean you automatically know our area…
In the end, it all worked out. The Buyer and Seller closed the deal for quite a bit more than your appraisals came in at. When you’re doing future appraisals, please consider speaking with the listing agent and enlisting their knowledge to help you accurately produce an appraisal. If you aren’t sure of a home’s features or have questions about the comps, PLEASE ASK…we are on your team and will get you whatever information you need.
To those 2 appraisers (I use that label loosely), please re-assign the appraisal if you see me listed as contact for the appraisal. I don’t want to work with you in the future. I want to work with professionals who show a willingness to understand our market and will complete an accurate appraisal of fair market value.
Showing posts with label sellers. Show all posts
Showing posts with label sellers. Show all posts
Wednesday, June 02, 2010
Tuesday, March 02, 2010
By now you have heard...January home sales were waaaayyyy down. By my calculations, sales in ALL sectors - homes, condos, beach, mainland, etc - were down 40%-50%.
What does this portend?? Well, that "V"-shaped recovery is an extended "U". I think is was a typical post-holiday lull complicated by record low temps (man, was it cold showing houses) coupled w/ a slowly declining market. I think we'll see more "normal" (a term I use very loosely) numbers in Feb and beyond.
The bugger in the covers are now the appraisals. Arms length sellers and buyers are watching their dreams evaporate thanks to new mortgage rules that require ZERO communication between sellers, buyers, realtors, mortgage brokers, etc. This rule would have been great 4-5 years ago but there are few who believe they can get away with mortgage fraud these days...which is what these rules aim to eliminate. Now, it's the regular joes like you and me who can't move on with their lives because some appraisers are UNWILLING to correctly value our homes.
What does this portend?? Well, that "V"-shaped recovery is an extended "U". I think is was a typical post-holiday lull complicated by record low temps (man, was it cold showing houses) coupled w/ a slowly declining market. I think we'll see more "normal" (a term I use very loosely) numbers in Feb and beyond.
The bugger in the covers are now the appraisals. Arms length sellers and buyers are watching their dreams evaporate thanks to new mortgage rules that require ZERO communication between sellers, buyers, realtors, mortgage brokers, etc. This rule would have been great 4-5 years ago but there are few who believe they can get away with mortgage fraud these days...which is what these rules aim to eliminate. Now, it's the regular joes like you and me who can't move on with their lives because some appraisers are UNWILLING to correctly value our homes.
Tuesday, July 07, 2009
With the increasing costs of basic necessities such as food and health care, as well as car insurance, fuel, clothing, etc. it is not uncommon for Home Buyers to need financial assistance with the closing costs when purchasing a home. Let's face it - not everyone who can afford a home's monthly payment has $7000 - $8000 for closing costs IN ADDITION to the home's down payment.
To go back a step, closing costs are IN ADDITION to the purchase price and include the following, among other items:
To go back a step, closing costs are IN ADDITION to the purchase price and include the following, among other items:
- Mortgage fees
- Insurance pre-pays
- Property tax pre-pays
- Closing fees
- Lenders Title Insur
- County & State recording fees
- Title endorsements
More often than not, closing costs for a home around $250,000 will be appr. $7500. Savvy Buyers (and their realtors) know that in this market, Sellers are willing to bend over backwards to ensure their home gets sold. Somethimes that includes making Seller concessions to pay all or part of the Buyers closing costs.
If the Buyer is getting an FHA loan, the MAX seller's can "contribute" towards the buyer's closing costs and prepaid items is 6%. Purchase prices can be bumped up to allow make the seller feel less "pain" but all too often appraisals come in lower than expected, which brings everyone back to the negotiating table.
If you are getting a conventional loan, many lenders cap the closing cost assistance to 3%, a significant difference. Most of the time, however, buyers getting conventional loans have ample money for downpayment and their closing costs.
For the Seller, I have heard of some instances where Seller Concessions are tax-deductible. You'll want to check with your tax advisor to see if that applies to you. Helping pay a Buyer's closing costs, whether in full or partially, is a win-win for all parties and is becoming a much more common occurence.
If your a seller, don't automatically shun these offers...they may be EXACTLY what you need.
Monday, June 22, 2009
SELLERS: FREQUENTLY ASKED TITLE COMPANY QUESTIONS
What Do I Do Before Closing?
1. Locate your prior title policy and survey, if possible.
2. Gather current loan information for each mortgage or line of credit so title company can order payoff:
a. Lender name & phone number
b. Loan number
3. Cancel homeowner’s insurance only after the closing.
4. Order final reading for all utilities effective the day of closing.
5. Bring your driver’s license or government issued photo ID (Military ID, Passport) and your social security number to closing.
6. If married, and the property you are selling is your residence, your spouse must also sign documents.
7. If you are bringing funds to closing in excess of $500, bring a cashier’s check made payable to Sunbelt Title Agency. (If you need wiring instructions, or want us to wire your proceeds to you after closing, please contact our office.)
8. Bring keys, garage door openers, and any special instructions for new owner to closing.
When and how do I get the escrow money back from my lender?
The lender is required to reimburse the money that is held in escrow within thirty days after it receives the payoff from the title insurance company. Escrow is almost never deducted from the payoff at the time of closing. If there are special circumstances that require this to be done or if you must receive your escrow sooner than normal, you should contact your lender well in advance of the closing to inquire about this possibility.
Why is my payoff so much higher than the balance shown on my last statement?
The primary reason is that the payoff statement includes interest due from the last payment you made up to the date of payoff. Mortgages are paid in arrears, i.e. January’s payment paid for the interest accrued in December. In some cases, if the payment for the month of closing isn’t made before closing, this could mean up to two months of interest will be included in the payoff. If the Per Diem Interest is $25, that could mean an additional $1,500 above the principal balance that is due. In addition, some lenders charge fees to obtain payoff statements.
Why am I paying for the buyer’s title policy and documentary stamps?
The Title Policy guarantees that clear title can be given on the property. It varies in different counties as to who pays for this, but in this region it is typically paid by the seller. Most contracts executed in the State of Florida require the seller to pay for the documentary stamps on the deed while the buyer pays intangible tax and doc stamps on the new mortgage.
How are title insurance costs calculated?
Title insurance rates are regulated by the State of Florida and therefore cannot vary greatly from company to company. Title insurance companies must also charge for what are known as related services. These services include the Title Search fee and the Closing fee.
The cost varies because it is based on the purchase price. It is a one-time fee and is paid at closing. Although you pay only once, the protection lasts as long as you or your heirs retain an interest in the property.
What is a prior policy and what is its importance now that I am selling or refinancing my property?
The purpose of a prior owner’s policy is to allow the seller to have re-issue credit. This grants the holder of the policy a greatly discounted title insurance rate if the following requirements are met:
· In the case of a sale, the Owner’s Policy must not be more than 3 years
old. Note: For refinancing the property and for vacant land, there is no
restriction regarding the age of the prior policy.
· The credit amount is based on the amount of the prior policy, not the
current sales price. The credit cannot be higher than the sales
price. If the prior sales price is higher than the current sales
price, the credit is based on the current, or lesser, amount.
· The insured names on the prior policy must be the same as those involved in the current transaction.
· The prior policy must be delivered to the title company before the closing.
· The prior policy does not need to be issued by the same title company that is issuing the new title policy.
· Florida law states that only a prior Owner’s Policy may be used in order to receive re-issue credit. A commitment or a Lender’s Policy does not qualify. When you refinance, you only purchase a Lender’s Policy which covers the new lender; your original owner’s policy is still in effect.
What Do I Do Before Closing?
1. Locate your prior title policy and survey, if possible.
2. Gather current loan information for each mortgage or line of credit so title company can order payoff:
a. Lender name & phone number
b. Loan number
3. Cancel homeowner’s insurance only after the closing.
4. Order final reading for all utilities effective the day of closing.
5. Bring your driver’s license or government issued photo ID (Military ID, Passport) and your social security number to closing.
6. If married, and the property you are selling is your residence, your spouse must also sign documents.
7. If you are bringing funds to closing in excess of $500, bring a cashier’s check made payable to Sunbelt Title Agency. (If you need wiring instructions, or want us to wire your proceeds to you after closing, please contact our office.)
8. Bring keys, garage door openers, and any special instructions for new owner to closing.
When and how do I get the escrow money back from my lender?
The lender is required to reimburse the money that is held in escrow within thirty days after it receives the payoff from the title insurance company. Escrow is almost never deducted from the payoff at the time of closing. If there are special circumstances that require this to be done or if you must receive your escrow sooner than normal, you should contact your lender well in advance of the closing to inquire about this possibility.
Why is my payoff so much higher than the balance shown on my last statement?
The primary reason is that the payoff statement includes interest due from the last payment you made up to the date of payoff. Mortgages are paid in arrears, i.e. January’s payment paid for the interest accrued in December. In some cases, if the payment for the month of closing isn’t made before closing, this could mean up to two months of interest will be included in the payoff. If the Per Diem Interest is $25, that could mean an additional $1,500 above the principal balance that is due. In addition, some lenders charge fees to obtain payoff statements.
Why am I paying for the buyer’s title policy and documentary stamps?
The Title Policy guarantees that clear title can be given on the property. It varies in different counties as to who pays for this, but in this region it is typically paid by the seller. Most contracts executed in the State of Florida require the seller to pay for the documentary stamps on the deed while the buyer pays intangible tax and doc stamps on the new mortgage.
How are title insurance costs calculated?
Title insurance rates are regulated by the State of Florida and therefore cannot vary greatly from company to company. Title insurance companies must also charge for what are known as related services. These services include the Title Search fee and the Closing fee.
The cost varies because it is based on the purchase price. It is a one-time fee and is paid at closing. Although you pay only once, the protection lasts as long as you or your heirs retain an interest in the property.
What is a prior policy and what is its importance now that I am selling or refinancing my property?
The purpose of a prior owner’s policy is to allow the seller to have re-issue credit. This grants the holder of the policy a greatly discounted title insurance rate if the following requirements are met:
· In the case of a sale, the Owner’s Policy must not be more than 3 years
old. Note: For refinancing the property and for vacant land, there is no
restriction regarding the age of the prior policy.
· The credit amount is based on the amount of the prior policy, not the
current sales price. The credit cannot be higher than the sales
price. If the prior sales price is higher than the current sales
price, the credit is based on the current, or lesser, amount.
· The insured names on the prior policy must be the same as those involved in the current transaction.
· The prior policy must be delivered to the title company before the closing.
· The prior policy does not need to be issued by the same title company that is issuing the new title policy.
· Florida law states that only a prior Owner’s Policy may be used in order to receive re-issue credit. A commitment or a Lender’s Policy does not qualify. When you refinance, you only purchase a Lender’s Policy which covers the new lender; your original owner’s policy is still in effect.
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