April 14th, 2021 2:49 PM by Andrew Walter May
With barely any new appraisers entering this morbidly defective industry, it's no wonder Fannie, Freddie and other government sponsored enterprises are moving to a MATH-BASED-SCIENCE strategy. Goodness, what does that mean? Well in 2002 I presented to Fannie the concept of using an insurance policy to eradicate the defective appraisal industry. Since that time Fannie (and others) have figured out that if the 4 homes surrounding the subject property all sold for more than the subject property, and the homes are identical - maybe, an appraisal isn't required or necessary.
All lenders do not check to see if the consumer will receive an APPRAISAL WAIVER. If you do receive one (an Appraisal Waiver) you don't have to pay for an appraisal (some lenders substitute a small fee). This saves the consumer between $500 and $750 depending on loan size. We've found that there are certain sweet-spot valuations. For example, if the client has a $2M home and a $200k loan, no need to go over $1M (since just about all over a million homes require an appraisal).
With the real estate industry red-hot throughout the country many appraisers are simply too busy. Appraisers can try to charge up to $4k more for an appraisal rush - we found someone else in Greensboro, NC that was less expensive. North Carolina is already a buyer beware state, it's harder now for the consumer to understand the market when they have to rely on a lender to do the right thing and not order an appraisal when one isn't required.
Make sure you ask your lender if they ran the Appraisal Waiver option, as this may cut as much as 3 weeks off your time to close. That saves you potentially thousands of dollars in lower rate lock costs (and helps to eliminate lenders that unscrupulously try to blow your rate lock). Call ADRMortgage.com for more information and advice on how to stay safe in shark-infested waters. 919 771 3379. Disclosure information found at www.adrmortgage.com. Andy May