My home sold -- but it didn't APPRAISE!

There are some big changes in the Appraisal World.

If you are selling your home or refinancing,

these changes will affect YOU!

In the past, there have been occasions in which a lender or loan officer has "encouraged" the appraiser to make sure a home "hit" a certain value. If the appraiser didn't do this, the mortgage company hinted that it might stop doing business with that appraiser.

By the same token, there have been occasions when a Relocation Company has requested that the appraisal be as low as possible, and again, the appraiser often did so in order to maintain his profitable business with that company.

NEW: Appraisers for conventional (conforming and non-conforming) loans are no longer allowed to communicate directly with anyone involved with the loan. (This does not apply to FHA or VA loans). That should be the good news. However, in order to comply with this:

• Lenders are now ordering their appraisals through appraisal management companies, which charge a fee to the lender and then pay an outside appraiser a portion of that fee.
• The appraisers are appraising homes in an areas with which they are totally unfamiliar.
• Often, they can only use sales no older that 90 days.

(With all of the above in mind, it seems strange that the new code does allow the fully executed purchase agreement to be provided to the appraiser as part of the appraisal assignment!)

What does this mean to you? No longer can a seller "test the market" to get a better price than a neighbor got 6 months ago. Even if you were to have multiple offers at that price, your buyer might not be able to get a loan, because the appraisal would be strictly based on very recent past sales.

The appraiser CAN still confer with your Realtor, however, so if you are planning to sell your home, be certain that you use a Realtor who has an excellent understanding of the local market, particularly in complex areas like The Woodlands, and who is able to provide the appraiser with the information to confirm your home's value.

Hiring a knowledgable Realtor has always been important. Now it is vital!!