Mortgage Business, Real Estate News

Why There Is a Shortage of Real Estate Appraisers

Their numbers are dwindling.

It takes a longer time period to get one done.

The costs have increased while appraiser compensation has decreased.

So, what’s happening and why is there a shortage of appraisers?

The National Association of Realtors recently took a survey and this is what was reported:

“Among the contracts that had a delay to settlement, 22 percent were from appraisal issues. Survey respondents blamed appraisal-centered delays on the shortage of appraisers, valuations that were not in line with market conditions, and “out-of-town” appraisers who were not familiar with local conditions.”

While there is no quick fix, here are some reasons why we are seeing fewer appraisers:

  • Training. It’s expensive, and an appraiser trainee must have 2000 hours of apprentice training (that’s almost one year based on 40 hours per week) with a fully licensed appraiser.
  • Fully licensed appraisers can’t make any money if they have to split the appraisal fee with a trainee.
  • Trainees make very little money—an average of $27,000—during their training period.
  • Appraisers get lower compensation if the appraisal is ordered through a management company.
  • Appraisers will turn down assignments if REQUIRED to provide a quick turn-around time
  • The average tenure of an appraiser is 22 years and they are not being replaced by younger appraisers.
  • The average tenure of a NEW appraiser is 5 years.
  • Appraisers have the added expense of keeping up with new regulations.

What types of appraisal issues have you been experiencing?

Mortgage Business, Realtor Advice

When Was the Last Time You Checked Your Voice Message Greeting?

A View from the Beach

Have you checked your voice message greeting lately?

Is it outdated?

Is it still relevant?

Is there background noise?

Many people record a voice message — and then forget about it.

I suggest that you update it at least once a year.

Here are some questions to ask yourself when re-recording your voice message

  1. Is it too lengthy?
  2. Does it sound sickly “sweet”?
  3. Does it make you cringe (like nails on a chalkboard)?
  4. Is it upbeat and positive?
  5. Does it sound like you are irritated or bothered?
  6. Is it cheerful?
  7. Does it provide too many details?
  8. Is it too lengthy?
  9. Is it a little bit clever?
  10. Do you use different tones/inflections?
  11. Does your greeting reflect your personality?

Experts recommend that you write out a script.

Keep it at 30 seconds or so.

Practice it over and over again.

Ask someone to critique it for you.

Record it and listen to it yourself. Re-record until you are satisfied.

Ask someone to call you and listen to it again.

Oh, and then remind yourself to re-record by adding a note to your calendar to update your voice message next year.

Consumer Advice, Mortgage Business

What is Mortgage Insurance and Why Would a Homeowner Have to Pay the Cost?

What is mortgage insurance?

Mortgage insurance is offered by either the government or private insurance companies to enable lenders to offer smaller downpayments on loans. Before mortgage insurance existed, many had to pay a minimum of 20% down to purchase a home which made homeownership unaffordable for many Americans. Mortgage insurance covers lenders for losses up to a certain amount if a borrower defaults on their mortgage.

There are two types of mortgage insurance available: Continue reading

Mortgage Business, Realtor Advice

Conforming Loan Limits Raised for First Time Since 2006

RatesThe Federal Housing Finance Agency (FHFA) is increasing the maximum conforming loan limit for mortgages to be acquired by Fannie Mae and Freddie Mac for the first time since the housing crisis.  The conforming limit will increase from $417,000 to $424,100 in 2017 for one-unit properties (or single family homes).

The conforming loan limits for Fannie and Freddie are determined by the Housing and Economic Recovery Act of 2008, which established the baseline loan limit at $417,000 and mandated that, after a period of price declines, the baseline loan limit cannot rise again until home prices return to pre-decline levels.

The FHFA noted that until this year, the average U.S. home price remained below the level achieved in the third quarter of 2007, which it designates as the pre-decline price level, and therefore the baseline loan limit had not been increased.

The increase is an indication that home prices have risen sufficiently for the government to authorize this increase.  Home prices were 1.7% higher in the third quarter of 2016 than during the same period in 2007, according to the FHFA’s Home Price Index, also released on Wednesday. The increase to the baseline conforming loan limit matches that 1.7% uptick.

The baseline loan limit applies to most of the country, with the exception of high-cost areas where 115% of the local median home value exceeds the baseline loan limit.  In these areas, higher loan limits apply.

For a full list of the conforming loan limits by county, click here.

 

 

 

Mortgage Business

Week Ending Friday, September 30, 2016

[Weekly Market Recap] Week Ending Friday, September 30, 2016

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A couple of global events caused a moderate amount of volatility for stocks and bonds over the past week, but the effects were offsetting. The economic data had little impact. As a result, mortgage rates ended the week with little change, remaining near the best levels of the year.

Early in the week, it was reported that the U.S. Department of Justice was seeking a $14 billion fine from Deutsche Bank, the largest bank in Germany, for issues regarding the sale of mortgage-backed securities (MBS) before the 2008 financial crisis. While the actual fine is expected to be considerably lower, investors still are concerned about the impact it will have on Deutsche Bank’s capital reserves. Bank stocks around the world declined over the past week on this issue and on overall concerns about the soundness of the European banking system. In response, investors shifted to relatively safer assets, including U.S. MBS, and the added demand caused a small improvement in mortgage rates. Most of the gains were offset later in the week, however, when it was reported that OPEC had reached an agreement on an oil production cut. This news caused investors to shift back to stocks.

While it caused little market reaction, Friday’s inflation data showed an uptick in August. The core PCE price index, the inflation indicator favored by the Fed, was 1.7% higher than a year ago, up from an annual rate of 1.6% for the prior five months. Core inflation excludes the volatile food and energy components. Investors often prefer to look at core inflation because it provides a clearer indication of the underlying trend. While core PCE remains steady at levels below the Fed’s target of 2.0%, investors will be watching to see if the August data marks the start of a trend toward rising inflation.

Looking ahead, the important monthly Employment report will be released on Friday. As usual, this data on the number of jobs, the unemployment rate, and wage inflation will be the most highly anticipated economic data of the month. Before that, the ISM national manufacturing index and Construction Spending will be released on Monday. The ADP Employment Change, Factory Orders, and the ISM national services index will come out on Wednesday.

Copyright @ 2016 MBSQuoteline

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Consumer Advice, Mortgage Business

USDA Lowering Fees

USDAProperties in all of Sussex County, DE may qualify for 0% down USDA guaranteed rural housing financing and we are a provider of these loans.  There are income limits and stricter qualification standards than an FHA loan for example, and these loans are only available for a primary home buyer.

Effective today, The USDA guarantee fee and annual fee are significantly reduced.  See this announcement:

“Borrowers who use the U.S. Department of Agriculture’s Rural Housing Service to get a home loan could soon pay significantly less for their loan, as the USDA announced that it is about to cut its loan fees for lenders who use the USDA’s Single Family Housing Loan Guarantee Program. In an announcement sent to lenders, the USDA said that it is cutting its fees beginning on Oct. 1, 2016, the first day of fiscal year 2017.

According to the announcement, the USDA is set to cut its upfront guarantee fee from 2.75% of the loan-at-close amount to 1%. Additionally, the USDA is cutting its annual fee from reduced from 0.50% of the unpaid principal loan balance to 0.35%. So, what’s the reason for the cut? Better borrower performance, according to a USDA official. According to the official, the USDA is able to cut its upfront and annual fees because borrower delinquency and foreclosure rates have reached “historic lows” since the beginning of the housing crisis. Additionally, the official said that successful partnerships between the USDA and the lenders who participate in its loan programs have resulted in “very strong” performance within this program.”

“When our borrowers succeed, the program succeeds,” USDA Rural Housing Service Administrator Tony Hernandez said in a statement provided to HousingWire. “Excellent overall performance in our Single Family Housing Guaranteed Loan Program means we can charge less for the life-changing opportunity to own a home.”

Source: HousingWire