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I am in the beginning stages of refinancing our mortgage. We have an ARM and are going into a conventional loan. The next step for us is getting the appraisal set up and the lender wants us to pay now and up front for that (I guess that is normal?). However, I also learned we qualify for the waiver of our appraisal b/c of our situation, if they do some kind of streamlined process.
Our mortgage specialist said yes we would qualify...but seems very hesitant to elaborate...now silent on Email.
What's the deal on this? Why would they be hesitant to do this? Seems like it would be simpler all around and also advantagous for us to not pay that $385. Is it more difficult for them? More paperwork? Less profit?
I would appreciate if someone could enlighten me. Thank you!
Perfectly normal to request payment up front for the appraisal. See, an independent (non bank or non broker employee) appraiser goes out and prepares an appraisal report for market value. The last time I looked at the page count, the document was 19 pages long, complete with photos. The appraiser's job cannot be dependent upon the transaction closing. How else would the investor know the integrity of the work product? And if you don't close, the lender is on the hook to pay for the appraisal. It's a pass thru charge, no one is making extra on your appraisal fee.
As for that waiver, don't make your decision dependent on it. Qualifying for the waiver means zip if the investor won't take it and way too many are not accepting waivers. I just had one and cast suspicion on the home and the borrower, just for shopping for one. If your transaction requires a waiver and that is what you are expressing, I'm not surprised your lender isn't real excited to get back to you. Actually, your loan is less profitable for the lender without an appraisal.
Thank you for explaining... not sure I understand everything, as I was just thinking there were two paths to the same goal - one being "streamlined" with the appraisal waived; the other the more conventional way and paying for the appraisal. Maybe the word streamlined is what's throwing me (it's what the lender used) - just sounds simpler and cheaper.
Are they two different animals altogether?
If it is less advantageous for me to do it that way...that's what I need to know. I know this stems from some governmental relief type program, so if I dip my hand into that pot and end up with more government strings attached then I really don't want that.
It would be nice if the lender would just take time and explain it to me, I am reasonable and understand they have to protect themselves and I am not smitten with the idea of government handouts if that's what this is... but not hearing anything at all is what is making me suspicious.
Perfectly normal to request payment up front for the appraisal. See, an independent (non bank or non broker employee) appraiser goes out and prepares an appraisal report for market value. The last time I looked at the page count, the document was 19 pages long, complete with photos. The appraiser's job cannot be dependent upon the transaction closing. How else would the investor know the integrity of the work product? And if you don't close, the lender is on the hook to pay for the appraisal. It's a pass thru charge, no one is making extra on your appraisal fee.
That only applies if an appraisal is needed. The lender should know based on the application if an appraisal is required.
Quote:
Originally Posted by SmartMoney
As for that waiver, don't make your decision dependent on it. Qualifying for the waiver means zip if the investor won't take it and way too many are not accepting waivers. I just had one and cast suspicion on the home and the borrower, just for shopping for one. If your transaction requires a waiver and that is what you are expressing, I'm not surprised your lender isn't real excited to get back to you. Actually, your loan is less profitable for the lender without an appraisal.
We refinanced our Fannie Mae loan with a waiver an no issues. As a matter of fact we didn't know we didn't need an appraisal until the lender told us. I don't know what investor you are referring to, if the loan is Fannie Mae it will stay Fannie Mae after the refinance.
To the OP. If this lender is not treating you right shop around for another lender. It is not your job to guarantee more profits for the lender.
Hmmm, that is good to know. Which lender did you use? I am starting off with Wells Fargo. So far I've only paid the credit report but locked in at 4.875, so I'm not sure if I'll get much better than that.
I also don't understand that if they are telling my my LTV is .62 and they
already figured that, what specific info does the appraisal add, other than knowing someone has actually come and laid eyes on the house.
Hmmm, that is good to know. Which lender did you use? I am starting off with Wells Fargo. So far I've only paid the credit report but locked in at 4.875, so I'm not sure if I'll get much better than that.
I also don't understand that if they are telling my my LTV is .62 and they
already figured that, what specific info does the appraisal add, other than knowing someone has actually come and laid eyes on the house.
We used Quicken Loans. If your LTV is .62 then you can refinance with whoever you want, you do not need to do it under the making home affordable program. Which is probably why they want you to do the appraisal. They want to sell your mortgage to investors instead of it staying under Fannie Mae.
Please do a google search on Quicken loans before you use them.
If you are a good credit risk it goes very smoothly. I was also worried when were going through the process but at that time no one else was doing the home affordable refinances so we risked it. We are very pleased.
As Victor hinted, do your homework on Quicken. I've seen some very good credit risks get burned.
The reason I am so emphatic about the various investors with appraisal waivers, I exhausted looking recently. 26% LTV, 810 credit score, back ratio under 20%. She didn't want to clean her house. Her land was valued 2x as much as the loan. Oh and it was a 15 year loan - it couldn't bet much better. (and a Realtor, the only reason I was looking). BofA the king of waivers stopped offering abbreviated appraisals last year, they were one of the last offering these. The others stopped a good while ago, regardless what AUS required. I promise you will get raised eyebrows if you shop for a mortgage based on who will offer an appraisal waiver. You may find one, but there will be a trade off, probably rate/points. I'm still wondering what is wrong with that Realtor's home.
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