March 22, 2009

Home Appraisal Process is Changing... Will it Affect Your Home's Value?

New York State Attorney General Andrew Cuomo put on his boxing gloves and jumped into the ring with Fannie Mae and Freddie Mac last year and the decision was unamious ... more regulations for all of us. Under current rules, when a homeowner or home buyer needs an appraisal, their mortgage professional orders it from appraisers they know and trust. The present rules require the appraiser to submit plenty of supporting documentation to prove a property’s value leaving little room for controversy. Beginning May 1, 2009 all conforming loans sold to Fannie or Freddie nationwide requires the mortgage bank funding the loan to use their appraisers. The attorney general believes this move will bring integrety and fairness to the valuation process for both homeowners and investors. I think we will see higher appraisal costs passed on the consumer, delays in getting appraisals completed while slowing down loan approvals and a decrease in home values. The new rule doesn't apply to goverment loans like FHA or VA. Some lenders have announced they will begin this practice as soon as April 1st.