Enjoy access to a free NMLS renewal class when you attend an in-person event.
Last month, I spoke about the growing issue that is a major concern with appraisal delays and barriers to entry impacting most home purchase and refinance transactions today. Over the last few months, I have seen this trend grow in my market and it’s the worst I’ve seen in the history of my time spent in this business. This is impacting all conventional and government loans and the VA is increasing appraisal fees to veterans from $500 to $780 on Sept. 1, 2016 just to incentivize appraisers through stronger compensation to take these orders.
My markets are Oregon and Washington. Our average turn-times in Oregon are approximately one month inside the metro areas and slightly less in Washington. The coast and other regions are five tom six-plus weeks or appraisers are simply turning down the orders and adjusting fees significantly upward (some more than $1,000 for a standard appraisal). Oregon is slightly worse than Washington, but I’m hearing Colorado and even Maine are also leading as some of the worst turn-times in the country. These fees and turn-times must stop, and in order to fix this issue, we need to tackle it now.
With the regulatory burden and difficulty for new appraisers to enter the market this is not an easy solution. It just came and hit us like a ton of bricks with markets in heavy demand and recent Brexit impact to rates hitting some of the lowest levels in history. Educating all parties should not be our responsibility as the lender exclusively. Real estate agents and others need to be active and educated on the process to set expectations accurately upfront to those they are hired to serve. We must simply ensure that our clients are protected both on rate lock and other costs whatever that takes with expectations clear with the state of appraisals.
Please share with us what you’re seeing in your state(s) and e-mail me below your average appraisal turn-time or post on our OrigiNation page on Facebook. We need to find a solution and gather this information. Please also share if you are seeing quoted fees upfront changed on the original order with the appraisal management company (AMC) and who we believe should be accountable to cover this difference providing the misquote to the consumer. Many are calling this appraisal fiasco “extortion” and I would have to agree.
Are you an originator? Send your stories! To have topics considered in future editions, please e-mail me with “OrigiNation” in the subject line at [email protected]. These can be confidential or your name and company can be referenced if you wish. You can also join the Facebook group by searching “OrigiNation.”
Andy W. Harris, CRMS is president and owner of Lake Oswego, Ore.-based Vantage Mortgage Group Inc. and past president of the Oregon Association of Mortgage Professionals. He may be reached by phone at (877) 496-0431, e-mail [email protected] or visit VantageMortgageGroup.com.
This article originally appeared in the August 2016 print edition of National Mortgage Professional Magazine.