In recent years there has been a criticism of the real manor assessment industry and some deservedly so, but the evaluation is a critical function of lending because it establishes the value of the collateral. For many decades this function was handled by human appraisers, but in recent years computer generated valuations have come into being. The following article talks us through the estate appraisals New York under fire again.
Banks: Follow the money, and it will always lead you to the culprit. In this case the banking industry. They overextended themselves through high-risk loan practices and then packaged the loans as products and sold them to other institutions - essentially spreading the infection. While overall loan rates remained low over the preceding three years with the dramatic rise in fuel costs in early 2008, credit became tighter, and these higher non-market based loan rates jumped as their entry level adjustable period ended.
An AVM would not be suitable in the case where the subject home is customized. That is it located in an area with considerable variation, where the home is in a level of condition. AVMs have their place in the real estate industry but so do humans and AVMs have been cited as a good reason to get rid of traditional appraisals.
Residential real estate appraisers are licensed by their respective states and have different levels of license levels based on the value of the loan for the property. They have to take classes and pass certification tests to gain and maintain their license status. They are also usually bounded by the county because of the way Multiple Listing Services (MLS) keep and sell their records. So a good appraiser knows their geography and what to look for.
Along with the value-added critique is the notion that when an evaluation comes in at or above the sale price of a home, the appraiser is not telling the reader anything he or she does not already know, and since appraisals so often do come in at or above the sale price, they are not necessary. This is a false concept and can be demonstrated by a simple analogy.
HVCC and the Law of Good Intentions: To help us all the government saw the problem as the appraised value of the properties not loan practices as the next big piece of the problem. They got attached to the New York Attorney General's Andrew Cuomo's "Covering Assessment Cypher of Conduct". This transformed appraisal practices with the determined of educating the present housing market.
The very presence of a visible policeman on the road does a great deal to hold down violations and accidents. If the police are writing too many tickets, we know something is wrong and that the system is not working, but when tickets are at a minimum, we know that the system is probably working. The same is true with real estate appraisers.
Appraisers: Real estate evaluators are conventionally approved by the state they operate in and judge within a given topography, so they advance over time a brilliant "feel" for market value. They are usually autonomous commercial folks who do assessments on a fee basis - no appraisals equal any money. Appraisal fees for regular homes can run from 200 to 400 dollars depending on the area and amount of work.
Banks: Follow the money, and it will always lead you to the culprit. In this case the banking industry. They overextended themselves through high-risk loan practices and then packaged the loans as products and sold them to other institutions - essentially spreading the infection. While overall loan rates remained low over the preceding three years with the dramatic rise in fuel costs in early 2008, credit became tighter, and these higher non-market based loan rates jumped as their entry level adjustable period ended.
An AVM would not be suitable in the case where the subject home is customized. That is it located in an area with considerable variation, where the home is in a level of condition. AVMs have their place in the real estate industry but so do humans and AVMs have been cited as a good reason to get rid of traditional appraisals.
Residential real estate appraisers are licensed by their respective states and have different levels of license levels based on the value of the loan for the property. They have to take classes and pass certification tests to gain and maintain their license status. They are also usually bounded by the county because of the way Multiple Listing Services (MLS) keep and sell their records. So a good appraiser knows their geography and what to look for.
Along with the value-added critique is the notion that when an evaluation comes in at or above the sale price of a home, the appraiser is not telling the reader anything he or she does not already know, and since appraisals so often do come in at or above the sale price, they are not necessary. This is a false concept and can be demonstrated by a simple analogy.
HVCC and the Law of Good Intentions: To help us all the government saw the problem as the appraised value of the properties not loan practices as the next big piece of the problem. They got attached to the New York Attorney General's Andrew Cuomo's "Covering Assessment Cypher of Conduct". This transformed appraisal practices with the determined of educating the present housing market.
The very presence of a visible policeman on the road does a great deal to hold down violations and accidents. If the police are writing too many tickets, we know something is wrong and that the system is not working, but when tickets are at a minimum, we know that the system is probably working. The same is true with real estate appraisers.
Appraisers: Real estate evaluators are conventionally approved by the state they operate in and judge within a given topography, so they advance over time a brilliant "feel" for market value. They are usually autonomous commercial folks who do assessments on a fee basis - no appraisals equal any money. Appraisal fees for regular homes can run from 200 to 400 dollars depending on the area and amount of work.
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