Category Archives: Mortgage Business

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?

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Is it outdated?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.

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

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.