New FHA Commissioner, David Stevens, announced the agency will be changing their appraisal rules and also including a 10% reduction in the amount senior home owners can receive from the reverse mortgage program. The latter is a discussion for another day.
The new guidelines, which will be instituted January 1, adopt some of Fannie Mae and Freddie Mac's "home valuation code of conduct" (HVCC). They also stipulate that FHA will not accept appraisals ordered by mortgage brokers, lenders, or anyone compensated on a commission tied to the completion of the loan. FHA regulations do differ from Fannie and Freddie, in that FHA wants appraisers to be paid fairly and in full.
Surprisingly, the Commissioner states that appraisers can disclose the amount of their fees, making this information available to the buyers and sellers in the appraisal report. This goes against traditional practice, where it is typically forbidden for appraisers to reveal their compensation.
An informative move for the consumer, as on average they are charged $400, when the appraiser, who works for the management company receives only $175-$200. This will increase consumer awareness of the many appraisers who have been driven out of business by these new regulations involving management companies.
Along with the disclosure fees, Stevens is thankfully mandating what he refers to as "geographic competency". This requires appraisers have a familiarity with the local markets and access to data relevant to the home's sale.
Geographic competency is imperative and a welcome addition to the new rules. Recently I received an offer on a property and the appraisal came in below the contract price. It was revealed the appraiser was not familiar with the area, and in fact resided and worked many hours away.
Does anyone else have a similar tale to tell?
Remember my client from last week who failed to get an inspection before purchasing her home in the divorce? She recently got an offer on her home.
During the inspection it was revealed that the roof was a Woodruff product, and there had been a class action law suit against Woodruff for their defective roof products.
We've been hearing conflicting reports that lenders are requesting 5 year certifications for the roof or will require the roof replacement. FHA is apparently more restrictive. My client has a roof inspector stating that the roof is in fine condition and he is willing to provide a one year warranty, to be renewed annually after inspection.
What's the best approach for successful negotiations and a smooth transaction? Your input would be appreciated!
Joan Rogliano has been practicing real estate for 25 years. She is a Certified Luxury Home Marketing Specialist and a Certified Real Estate Divorce Specialist.
While the First Time Home Buyer tax credit has been in the news these days, another bill in Congress could be equally significant, only with negative ramifications. The Congressional Budget Office has been preparing a report that suggests Congress cut deductions for home owner mortgage interest from it's present 1.1 million dollars to $500,000. The deduction would be phased in by $100,000 annually, starting in 2013.
Over a 10 year period, this would increase the revenue by an estimated $41 Billion Dollars. In addition, there are two proposals which aim to replace the mortgage interest deductions with a flat tax credit of 15% of mortgage interest paid. The other proposal is for eliminating deductions for all state and local taxes, which is estimated to cost $862 billion by 2019.
What does this mean for property owners?
Currently, If you're paying $1000 a month for your mortgage, $900 might be interest payments and $100 is paying the actual principal. At the end of the year, you're allowed a $10,800 tax credit. ($900 per month interest x 12 months). However, if this suggestion is undertaken, these tax credits would be eliminated and property owners would no longer receive these write-offs.
Should this legislation pass, it would undoubtedly have a dramatic effect on our unstable housing market.
Joan Rogliano has been practicing real estate for 25 years. She is a Certified Luxury Home Marketing Specialist and a Certified Real Estate Divorce Specialist.
Information and facts taken from Washington Post Writer's Group, Kenneth R Harney.
Join Us as we Support our WFG Models!
Date:
April 23rd, 6:00 - 8:30 P.M.
Show begins at 7:00
Location:
7899 S. Lincoln Ct, Littleton, CO
Prime time clothes for prime time women accessorized with Silpada jewelry. Enjoy accessible clothes from local designer James Silvrants modeled by our very own "Wildflowers".
James is also a renowned makeup artist, and he will be choosing audience members to make simple suggestions for a fresh look.
Grab some friends and a munchie and join us as we
Fling Into Spring!
For additional information call: Joan Rogliano, (303) 667-5485
RSVP's to info@wildflowergroup.com
Joan Rogliano is the Founder of The Wildflower Group, an organization that strives to empower women with practical information about finances and real estate, and to create a sense of community. For more information visit www.wildflowergroup.net.
A realtor for 25 years, Joan is a CRS and GRI, and has recently been awarded the Certification to Market Luxury Homes. She works in the greater Denver metro area, as well as the foothills.
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
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