Rates are flat today. Bonds took a hit yesterday due to the poor two year auction. However, there was some good news this morning. The housing market has seen an increase in the Case Shiller Home Price Index (home prices are going up) from March to April and was the first time in 8 months. It this due to shadow inventory? Time will tell. Today’s comparison rates with no lender fees are 4.5% APR on a 30 year, 3.75% APR on a 15 year and 2.985% APR on a 5/1 ARM. (click here to get the details).
I’m back from a day off yesterday and it’s good to know that my team has “cloned” me for when I need days off. Now I just need to get him to shave his head too.
Anyway, on a serious note, I am sure you are well aware of appraisals being an issue in underwriting due to low values. However, did you know that if your appraisal comes in too high it can be a major problem too? I know it makes no sense but it’s actually true! You don’t want your appraiser to come in too high.
I explain in today’s episode:
Well it happened again. On twitter, Catherine Thomas shared this story about a homeowner foreclosed on a national lender. You may remember earlier this year that a Wells Fargo office had foreclosure papers served on them. Well now it was Bank of Americas turn and the Sheriff actually came for the seizure! Crazy!
Both situations were from mistakes made by both lenders. I wonder how many other mistakes like this happen that don’t make national news. Click on the link below todays video for the full story. It’s a good one!
Ok, back to the high appraisal issue. Let’s say you think your home’s value is $200,000 and you get an appraisal done and it comes in at $300,000, great thing right? Well, when your loan officer reruns your findings in their automated underwriting system it will most likely RED FLAG the value due to it being excessive. Even though you used a qualified appraiser to get value you could be required to get another opinion of value which could cost your hundreds of extra dollars or another full appraisal.
This is a major headache.
Even though this situation is rare, it does happen. It usually happens if you recently did a major remodel and your value goes way up. Keep this in mind when you are tell your loan officer what your house is worth. Be realistic and provide details as to how you come up with that value. Details are always important.
Hey, if you get a chance, I would love it if you could help me in my mission to bring transparency to mortgage lending by sharing today’s episode on Facebook or Twitter. Let’s change the way people shop for a mortgage…forever!
See you tomorrow!
PS. To ask a question, get advice, or find out what your lender is making off your loan, just post a comment below. Daily comparison rates, calculators, and other cool features are available in the free Rates in Motion LoanApp by going to your smart phone and clicking on this link, activation code is 9203780002