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Old 11-20-2009, 12:27 PM
 
Location: Palm Island and North Port
7,511 posts, read 22,922,074 times
Reputation: 2879

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Quote:
Originally Posted by Dreamy46 View Post
Unless someone had intricate knowledge of who friends and family are, short of blatant same last name situations, it would be impossible to screen for that.

How do the banks handle Chinese Drywall homes?
If they are aware that the home has Chinese Drywall it must be disclosed. According to Johnson vs. Davis, in the state of Florida, all known material defects must be disclosed. I've seen several listings that stated the home has CDW. You'll usually see reference to it in the listing, if it is known. If it were me I would also have my buyer sign a disclosure stating that they are aware of this. There is now a CDW disclosure form.

Here's a statement out of a listing that just closed in NP in the last few days:

"There is a potential for Chinese drywall in property so buyer's initial inspection should include such inspection."

We can't say that it has CDW because we are not certified to make that kind of a statement but if we/the bank believe there is CDW we will/should alert the buyer.
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Old 11-20-2009, 02:32 PM
 
385 posts, read 1,159,420 times
Reputation: 115
Quote:
Originally Posted by davery5872 View Post
Interesting. It could be worse, as I have found the values on Zillow to be 10-15% higher than what a property actually sells for.
Davery, Zillow is a very unreliable resource.
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Old 11-20-2009, 03:00 PM
 
204 posts, read 601,692 times
Reputation: 99
Quote:
Originally Posted by SoFLGal View Post
Good quote and interesting article. I have been the listing broker on many of my BPO's and I do know that in every case they have checked my work. I always get a call from the bank asking me why I used a certain home or why I made a certain comment on the BPO or how I came to a cost for the repair work needed, etc. In many cases they will reference some other BPO that they have gotten in. We also get the question quite often, "does the bank know what kind of work needs to be done" or "has the bank seen this?" The answer is yes, we have to send multiple pictures of any damage, get estimates, send at least four photos of every room, pictures of all the mechanicals, front, back, side pictures, street view, etc. So yes the bank is fully aware of how the home looks and any issues that are readily apparent.

Once the bank gets our report in they compare it with the others and come up with a reasonable price. They also require unemployment stats, supply and demand stats, days on market, the most similar 3 active properties and sold properties and a ton of other things. I would say they have a pretty good picture of what an accurate price might be. If you don't give the banks accurate values then you won't be listing for very long. Fannie and Freddie have even more requirements. Such as, the home has to be listed in the MLS for at least 15 days before they will consider any offer. Also no investor bids within the first 17 days. We have to send them a copy of the actual MLS listing sheet. This would prevent any "selling to friends or relatives".
Ah, if banks had only been this diligent over the past few years, we wouldn't have been in nearly this big of a mess.

If I were a news producer and had the budget, I would hire 10 different appraisers from the area to appraise the same home back to back (all being unaware of each other) and share the results publicly.

My wife and I are the middle of a refi to try and capture the lower rates- but as of June banks are now requiring foreclosures in the comps. We initially did an appraisal in May which came back great, then held off on the refi until we finished a bit of remodeling. Hope waiting wasn't a big mistake...

Back in 1999, we took out a Heloc on our home at that time (living in Palmer Ranch), and the appraiser came back with a number that the bank disagreed with, to the tune of a 35% discrepancy. This and quite a few other personal experiences make it seem that appraisals are often a crapshoot (not SoFlGal's though- she actually knows what she's doing).

Now that banks control appraisal ordering and there's blood in the proverbial water, you have no recourse if your appraiser seems off the mark, short of asking (and paying!) for a pricey second opinion.

HHH
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Old 11-20-2009, 03:04 PM
 
204 posts, read 601,692 times
Reputation: 99
Quote:
Originally Posted by angelfish View Post
Davery, Zillow is a very unreliable resource.
Amen, however much to my surprise and dismay, two different banks we've spoken to about a refi admitted that they refer to it. How much it impacts the decision making process, I have no idea, but it's strange to think that the professionals even glance at such a potentially unreliable resource.

Bank of America (they did our appraisal, etc in May), and a local bank in Sarasota (SoFlGal might know who I'm referring to) who we are working with right now.

HHH
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Old 11-20-2009, 03:25 PM
 
385 posts, read 1,159,420 times
Reputation: 115
Quote:
Originally Posted by HenryHelmhazzard View Post
Amen, however much to my surprise and dismay, two different banks we've spoken to about a refi admitted that they refer to it. How much it impacts the decision making process, I have no idea, but it's strange to think that the professionals even glance at such a potentially unreliable resource.

Bank of America (they did our appraisal, etc in May), and a local bank in Sarasota (SoFlGal might know who I'm referring to) who we are working with right now.

HHH


Wow, you have got to be kidding me. That blows my mind.
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Old 11-20-2009, 09:00 PM
 
Location: Bernanke's Financial Laboratory
513 posts, read 1,223,678 times
Reputation: 225
Quote:
Originally Posted by angelfish View Post
Davery, Zillow is a very unreliable resource.
While not perfect, Zillow certainly isn't any worse than most other sources, especially since most of their data comes from sales transactions gleamed from public records. It isn't like they make the numbers up.

So rather than just saying they're "very unreliable," make your case as to why they're unreliable?
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Old 11-23-2009, 07:29 AM
 
37,315 posts, read 59,869,570 times
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regarding the initial post--people like our daughter and SIL who own a condo on Venice Beach are probably negative on their home "equity" because the market value is down from what his purchase price and mortgage balance are--but they are current on their mortgage there...
the loss is a paper one--until they actually try to sell...
I think many people are counting their type of homeowner--people who own more than current mortgage balance yet are not delinquent--
there are hunderds of thousands of people like that in FL and other states right now...
we were that way in our TX home during the 80s--after we first moved into it and the oil industry collapsed and the economy was in recession---but we did not try to sell during that time...now we are equity ++
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Old 11-23-2009, 07:56 AM
 
Location: Bernanke's Financial Laboratory
513 posts, read 1,223,678 times
Reputation: 225
Quote:
Originally Posted by loves2read View Post
regarding the initial post--people like our daughter and SIL who own a condo on Venice Beach are probably negative on their home "equity" because the market value is down from what his purchase price and mortgage balance are--but they are current on their mortgage there...
the loss is a paper one--until they actually try to sell...
I think many people are counting their type of homeowner--people who own more than current mortgage balance yet are not delinquent--
there are hunderds of thousands of people like that in FL and other states right now...
we were that way in our TX home during the 80s--after we first moved into it and the oil industry collapsed and the economy was in recession---but we did not try to sell during that time...now we are equity ++
But where would you be if you had of dumped it and bought back in at half the price?

That old myth that "it's only a paper loss, or "you haven't lost any money on your house until you sell" is right up there with "they're not making anymore land," or "buy now or be priced out of the market forever!"

If all that money is coming right back, then why did the banks take write-downs and why are they selling at a loss?

We'll check back in 2035 and you can let us know how things are going, but in the meantime, I pity the person who has to spend all those years living next to the folks that paid 1/3 as much...

Quote:
"On a regional basis, Moody's said hard-hit states such as Florida and California will be among the last to recover and "will only regain their pre-bust peak in the early 2030s, well after the nation does."
Home prices won't regain peak this decade: Moody's - MarketWatch

Recognize this guy circa 2007?

Cramer: No really, dump your house

How about all these high credit score folks? Are they all dumb?

Homeowners who 'strategically default' on loans a growing problem -- latimes.com
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Old 11-23-2009, 10:08 AM
 
Location: Bernanke's Financial Laboratory
513 posts, read 1,223,678 times
Reputation: 225
Good reads from the weekend real estate news:

Glut of area foreclosures expected to swell - Business - BradentonHerald.com (http://www.bradenton.com/business/story/1866297.html - broken link)

Lawyer's foreclosure defense of 'quiet title' faces tests - Jacksonville Business Journal:
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Old 11-23-2009, 11:23 AM
 
385 posts, read 1,159,420 times
Reputation: 115
Quote:
Originally Posted by Dreamy46 View Post
While not perfect, Zillow certainly isn't any worse than most other sources, especially since most of their data comes from sales transactions gleamed from public records. It isn't like they make the numbers up.

So rather than just saying they're "very unreliable," make your case as to why they're unreliable?

A true estimate can only be obtained from an appraiser who will do a drive-by (similiar to Zillow based on a visual inspection and public information of comparable properties) or a full-fledged appraisal. Also keep in mind that even with appraisers, their estimates can vary based on interpretations.Then they will use this value as a comparison for other homes in the neighborhood.

A Comparative Market Analysis may be obtained from a licensed Real Estate Professional. While not a 100% true indication of value, it would be next the best thing to having your home appraised professionally.

Zillow will use all sales as comps for a neighborhood. The Zillow appraisal does not take into account any renovations/upgrades, short/foreclosure/trustee sales etc. It was a sale nonetheless, they will use this value as a comparison for other homes in the neighborhood. This can lead to inaccurate estimates. While some neighborhoods may be relatively accurate, others can be way off. Hit, or miss.

From Zillow: We get our data from public records. If those records are not updated with info on what you or your neighbors have done to improve your homes, we have no way of knowing the improvements that were made. However, you can update the information on your home on Zillow by updating your home facts and creating your own estimate. Here's more on how to do it: Edit Your Home Facts - Zillow Advice

Once you do this, it can potentially affect your Zestimate value.

You are correct, it certainly couldn't be any better or worse than any other online source like it. You have to wonder if a lot of FISBO's use this type of unreliable information to price their homes. While they may hit, they may miss and have a potentially under priced or over priced home on the market. In the end, its probably best to leave it to the professionals.
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