Thanks to those who commented on the last post about text vs. videos!
It feels like working in a vaccum at times, because not that many people leave comments (which is fine). If you have thoughts on the blog material or direction, feel free to comment – I think there are only 50-100 commenters, yet there were over 14,000 unique visitors in the last month!
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Thanks to JP for sending this along:
To help make appraisals more consistent and accurate, the Federal Housing Finance Agency has directed Fannie Mae and Freddie Mac to develop the Uniform Appraisal Dataset (UAD). The UAD will (1) define what fields are required for an appraisal submission and (2) standardize both responses and definitions for certain fields.
Here are just a few of the items impacted by the new appraisal standards:
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Days on the Market: Days on market is now defined as the total number of continuous days. If a property is taken off the market and then relisted, the appraiser will have to count all of the days it has been listed.
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Offering Price: The original offering price and history of all price changes must be reported.
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Property Style: Appraisers must use appropriate architectural design indicators such as “Colonial,” “Farmhouse,” etc. Descriptions such as 1 story, 2 stories, etc are no longer acceptable.
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Condition of the Subject Property: An overall condition rating must be assigned from the predefined condition categories provided.
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Quality of Construction: The appraiser must rate the quality of construction of the subject property and all comps using a list of 6 predefined quality levels.
The UAD appraisal standards are required for all appraisals conducted on or after September 1, 2011 for conventional loans sold to Fannie Mae and Freddie Mac.
To read FAQs about the UAD appraisal standards, visit:
https://www.efanniemae.com/sf/lqi/umdp/pdf/uadfaqs.pdf.
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Hopefully the appraisers will be diligent enough to catch the short-sale listing agents who never expose their listings to the open market – because the Sandicor MLS is still complicit in the fraud. The typical fraud is for the listing agent to immediately mark the property ‘contingent’ in the MLS upon input – but Sandicor’s MLS doesn’t stop the count of days on market until it’s marked pending. The date the listing is marked contingent is mentioned in the listing history – but will casual appraisers look there? Or just take the DOM count which is calculated from listing input to pending? A typical short sale isn’t marked pending until the short sale is approved, which is 1-6 months after listing input.
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Here is how B of A is trying to fight short-sale fraud:
BofA short-sale add and broker cert
It’s a general form that has all parties sign that they aren’t committing fraud, which may not stop them but at least make them think about it before doing so. The listing agent also has to certify that:
“the subject property has been listed on the local multiple listing service at fair market value to provide open market competitive bids to present to the seller as per the terms of the seller/agent listing agreement, and that the marketing is in fact and ‘in spirit’ seeking to maximize the selling price of the property.”
There will be some agents getting out of the short-sale business if they can’t commit fraud, so I hope more banks crack down like this.
Great about the DOM. That was long in coming.
I don’t know if this is a B of A property, but there is definitely some weird history.
3246 Ingelow St
Jim, I enjoy your videos of those lovely SoCal homes . Keep up the good work letting individuals get smart about buying and selling. Thanks…
Breaking news- 4.12% 30 year.
Just have to have that 20% down and you are golden.
Seems like the burden is on the Appraiser to determine the DOM even if it comes on and off the market multiple times. I figure since it would be difficult to figure it out the appraiser would probably take the easy route and just list the current DOM on the listing. What would be the incentive to spend all the time digging through the MLS to get the info on previous listings for that particular property assuming they actually can.
@ #3 Look at credit unions too! I just checked mine and they’ve offered 4% 30-year fixed–w/ 20% down– for the last week.
I got a 4% 30-year fixed last November (from a mortgage company) and now ponder whether rates will actually fall below 4%…
That it’s taken them this long to try and address these things to help curb fraud is amazing to me. Glad to see the changes.
Re: Item #3
You should push to get your 1980’s “Nouveau Taco” as a recognized property style, Jim.
Speaking of recent experiences with B of A short sales, here is an anacdote based on clean approval letters for a short sale that were issued by B of A this week.
Seller had refi 1st and seconds both held by B of A which approved a significant write down of both loans with no contribution by Seller or beating up of agents or buyer.
This approval came after seller was only two months delinquent with no foreclosure pending.
So those out there who think that short sales are a waste of time for the seller would be very mistaken in this case. Seller got away with turning a potenital recourse second issue into non-recourse with a relatively minimal hit to his credit vs. what would have happened with a foreclosure.
Tax situation is more complicated, but still, big win for the seller by doing a short sale.
Maybe B of A is changing its tune if not speeding up the tempo.
Hey Jim,
I really enjoy watching the videos but like others, I don’t get much chance. I appreciate reading text articles when I’m at work. I think a balance would be best – post a nice video like usual, but maybe sum up the main points in a paragraph or two alongside it. Sometimes, I have to try and glean what the video was about just from the comments section!
I hate banks! I made an offer for 20K below the list price and now they come back, after eight weeks, damanding 1K over list. We are talking less than 1.9% of the list, but the listing agent claims they are going to walk. And the second is only getting 10% on the dollar. No wonder the economy is in the tank.
Not sure how DOM would be considered in the Appraisal value. Sure, if the property has been on the market for 220 days, they’re probably asking too much. But wouldn’t that come up in appraising the actual property? Perhaps it’s next to the freeway or power lines?
I really don’t get how asking price and listing price would be considered in a calculation.
For all the complaining about slow short sale processes… the few I’ve observed have gone quickly. One recently only took a couple days to get accepted by the bank, and when the buyer went back to lower it another chunk after seeing inspections, the bank approved it in 2 days.
Assuming one had enough data and the proper algorithm, you could probably get to 90-95% of the true value on 90-95% of the sales. There would be the unique cases, i.e. the multi-million dollar mansions, or the palace in a crappy neighborhood, but for the most part you’d be right. DOM would certainly be able to help the algorithm, it wouldn’t be the highest weighting but it would be in there with location, price/sf, # beds/#baths, etc.
You know something is priced at market or below market if it sells within 15-30 days. If it sold after 180 days if was either a special kind of buyer, prices rose to the sellers price point, or the seller decided to take less than list.
It’s about time they at least started trying to clean up all of the fraud. I think Bank of America is on the verge of ruin, so maybe there’s some urgency to sew up the giant holes in their pockets.