Ross Acheson, Acheson Appraisal, Those that can’t do: TEACH!
Ross Acheson, Acheson Appraisal, Those that can’t do: TEACH!
Originally Posted by George Hatch
From an email I got today from Ross Acheson:
We have asked Mr. Robert Murphy, who is in charge of the new 1004MC for FNMA, for some answers. Here they are:
1. How much data is enough for creating statistics?
That will vary with each assignment. You can expand your search area to include more data if that data is representative of your subject’s area. Otherwise either state that there is not enough data or use what you have.
I guess the appraiser should use what he has even if too small to be statistically significant since we all know that the underwriters are not going to accept a statement that there is not enough data to use. Thank you Fannie for the nice non-answer that is of absolutely no help to anyone.
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2. Should we use CDOM (Cumulative DOM) or DOM? And for listing price…should it be the original or current price?
Be consistent. Use DOM with current listing price or CDOM with original list price. Note: We believe that DOM with current listing price is preferable.
It is a shame that many MLS systems make it virtually impossible to track DOM based on the current listing price. Additionally, in some markets, many of the real estate brokers change the listing price to equal the contract price once a contract is ratified, which would make the DOM for many of these properties zero using Fannie’s expressed preference…of course, like many other things, Fannie did not think things completely through before they made this statement.
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3. When will the FNMA webinar be available on your web-site?
Probably by 3/16/2009
If the webinar is of the same quality as the 1004MC form, it will be of no help to anyone.
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4. Why is the List/Price ratio upside down?
We are correcting that in a new version that will be available on our web-site by 3/10/2009.
Nice job proof reading the form before you initially released it.
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5. What if there is range pricing (eg. $400,000 - $450,000)?
Use the lower end of the range.
On what basis should the appraiser pick the lower end of the range? Why is this any better than picking the middle or the upper end of the range? Would not a hard rule requiring the appraiser to always pick the low end of the range (no matter the circumstances) lead to misleading analysis?
Once again, Fannie demonstrates total cluelessness.
It is apparently much easier to draft and require the use of a form that is useless in most cases and will be misleading in many cases than to require lenders to use competent appraisers who write good reports which contain a properly done market analysis.
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Ross Acheson, Acheson Appraisal, Those that can’t do: TEACH!