Realtors (Knoxville: real estate, insurance, mortgage) - Tennessee (TN) - City-Data Forum

L8rFL · 01-02-2009, 03:07 PM

I was wondering with everyone moving to East TN, how is business? This would go for appraisers, lenders, insurance agents, and any one else in the housing markets?=!

Beretta · 01-02-2009, 05:35 PM

Quote:

Originally Posted by L8rFL

I was wondering with everyone moving to East TN, how is business? This would go for appraisers, lenders, insurance agents, and any one else in the housing markets?=!

I am moving this to the Knoxville forum since you requested info on East TN. If you meant upper east TN please let us know and we will move this to the Tri Cities forum. Thanks and good luck.

Barking Spider · 01-02-2009, 08:01 PM

I can speak for home inspectors and appraisers. SLOW!

From what I hear from my Realtor friends, it's slow for them too. Appraisers have been dealt a rough hand. With the changes in the rules, it is going to be very hard for appraisers to get the work they used to.

hiknapster · 01-03-2009, 05:49 AM

What rules changed?

Barking Spider · 01-03-2009, 06:56 AM

Since I'm not an appraiser, I may not have all the details right, but this is how I think it changed.

Before, a mortgage company or lending institution could choose whatever appraiser they wanted. Typically they would build relationships with appraisers and continue to use them.
Now, they are required to use a "list" of approved appraisers and have little or no control over who does the work. The appraisers are given assignments on a rotation basis.

I think this change was brought in because of the mortgage fraud that went on in some parts of the country.

So now an appraiser has to get on the "approved list" at every lending institution and share the business with so many other appraisers. So if Joe Appraiser had a great relationship with Fred Banker and Fred had 75 jobs a year, Joe got 75 jobs. Now Fred has to divide those 75 jobs among the 5 or 6 or 25 appraisers that are on the "list". Fred has no control. Joe now will get a fraction of the business he used to, and all of the good relationship building is tossed out the window.

That's how I understand it works.

hiknapster · 01-03-2009, 08:24 AM

Quote:

Originally Posted by Barking Spider

Since I'm not an appraiser, I may not have all the details right, but this is how I think it changed.

Before, a mortgage company or lending institution could choose whatever appraiser they wanted. Typically they would build relationships with appraisers and continue to use them.
Now, they are required to use a "list" of approved appraisers and have little or no control over who does the work. The appraisers are given assignments on a rotation basis.

I think this change was brought in because of the mortgage fraud that went on in some parts of the country.

So now an appraiser has to get on the "approved list" at every lending institution and share the business with so many other appraisers. So if Joe Appraiser had a great relationship with Fred Banker and Fred had 75 jobs a year, Joe got 75 jobs. Now Fred has to divide those 75 jobs among the 5 or 6 or 25 appraisers that are on the "list". Fred has no control. Joe now will get a fraction of the business he used to, and all of the good relationship building is tossed out the window.

That's how I understand it works.

Wow. That stinks. I wonder how that affects FHA loans. Many people want to refinance, right now. I'm thinking about it.

itsjustme64 · 01-03-2009, 08:52 AM

Once again, the good honest business people who worked hard to establish contacts and earn business will be punished with additional regulation.

And sooner or later fraud will pop up again in a different form.

knoxgarden · 01-03-2009, 03:00 PM

It's going to be bad for awhile. The whole toxic mortgage problem isn't going away anytime soon. Lending requirements are going to be much, much tighter and appraisals will come in low.
The problem was that appraisers would value a home at more than it was worth to get a larger loan, particularly on refinancing, with some of the cash gotten out of the real estate getting kicked back to the appraiser who was buddies with the finance company.
IRS has been pursing these and other real estate frauds:
Real Estate/Mortgage Fraud: Facts, Figures and Closed Cases (http://www.irs.gov/compliance/enforcement/article/0,,id=162992,00.html - broken link)
This isn't going away anytime soon. I've been thinking of refinancing but waiting for the initial panic to calm down a bit. It's going to be very, very hard to get a loan for anything right now. Car dealers have been going under because the few people who are buying cars can't get loans. Credit card companies are cutting back limits. People who were living beyond their means are going to find they can't do that any more.

Servpro Will · 01-03-2009, 04:33 PM

Real estate business has actually started to pick up quite a bit. October and November were quite slow, though December saw a lot of upswing in touring traffic for many. Rates have been dropping and many home buyers have received loans in the high 4's, and low 5's. Rates in the 4's usually only hovered for a matter of hours, so having a good lender ready to lock in a rate is of course key. Of course the problem with these loans, while the rates are dynamite, is that the lending requirements have become stricter. Home buyers that used to have a "good" credit score could receive the same loan as someone with flawless credit, not so anymore without buying points or other fees.

Knoxgarden, if you're going to refinance, now is actually a very opportune time for refi's. I actually recommend many people to find the mortgage lender they trust, tell them the rate they're comfortable paying, and give them free reign to lock you in if rates dip below your comfort level. I've seen many o' people with ARMS or simply rates in the 6's save $100-$500 on their mortgage with allowing their lender to lock them in at a 4.875 rate simly because they gave them the green light to do so. If the rates don't get below your comfort level, no harm no foul.

The rotation scenario with appraisers in unfortunate for the hard-working, marketing savvy workers. Though something did have to be done, as appraisers were a lot of the original problem. I don't like it, but still the same. What was happening was that appraisers that had a close relationship with a lender, would often "stretch" the value of an appraisal to make a loan work, not wanting to lose any business from their close partners. This gave many untrue property values. Now with the rotation, and stricter guidelines, appraisers are having to give more honest values. Appraisers cannot protect their relationship with lenders anymore by "making deals work", yet give honest values to stay on rotation. Small, privately held banks can still choose sometimes, but it has become more tight.

I would say overall the market appears to be somewhat improving, though mostly for buyers and not sellers. Though enough of a buyer's market always will in the end produce a seller's market, though it can take a while.

hiknapster · 01-03-2009, 05:19 PM

What about the FHA loans? Are they getting harder to qualify for?

That's a great idea, William! I will tell JT to lock in my loan at a certain level! I'm planning on paying all the closing costs, too. Proving my husband's income is always a bear, though.

We did it last summer with a FHA and credit companies seem desperate for customers with good credit. They have certainly been very kind to us! We still pay off our purchases, though. I have always been paranoid about money!