Ron really pulled the curtain back on the appraisal process. It is ALL about protecting the lender to enable THEM to resell the mortgage to an investment group. The idea it has anything to do with the value (price an able and willing buyer and seller agree upon) is a smoke screen.
Each bank imposes a unique set of guidelines on the appraisal in regards to what can be considered as comparables. This 'unique' set of guidelines allow them to conform the loan to the requirements of the orgainzation to whom they intend to sell the mortgage.
Too often this results in FIAT appraisals!
NO, consumers are not totally at the mercy of the lenders and the 'fix' the lenders have inserted into the system.
However, the path to success is through the close cooperation of professionals in the real estate and mortgage business who construct the transaction in anticipation of the obstacles that are easily predictiable. FIAT appraisals are one of the easily predictable obstacles.
Prevailing over this expectated abborition requires the buyer and seller to have their feet firmly planted on the ground of reality and with the agility to circumvent the banks intended sabatage.
Best of success,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
Times change; just like a lot of things nowadayze>
The Appraiser's primary job is to protect the Lender from hurting themselves.
If you were a Lender, wouldn't you want some kind of protection: You do not have the time or the ability to travel from Maine to Albuquerque to personally evaluate every property that you are asked to lend on.
It is imperfect. Not everybody is going to agree with you.
But if you are going to be around 5 years from now, lending money to would-be buyers, you have first, got to be still in business.
We have a procedure in my shop if the parties believe the report is wrong, they simply must contest it in writing and furnish proof it is wrong. Last year I had an agent send me “proof” that lowered the value of the report. If you don’t agree with the documentation in the report you must be prepared to furnish better documentation.
NMLS # 6395
Financing Kentucky One Home at a Time