The Necessity of Remaining On FHA Roster, The FHA Appraiser Inspection Course, Checklist and eManual

Jan. 25, 2010 - PRLog -- 2010 Could Be A Very Challenging Year For Home Appraisers!  
The current economic news suggests 2010 will be a very challenging year for home appraisers in the form of less demand for appraisal orders.  First, the stability of the entire U.S. Financial System is in question.  Commercial mortgage delinquencies continue to rise.  CNBC just reported that 9.97% of home loans are now delinquent.   It's predicted in 2010 that a housing crash looms as we will reach shadow inventory of 7 million.  As we reach this 7 million, the demand for housing will decline and housing prices will follow.  With less equity, there will be less refinance appraisal orders.  The Crabtree Report says home prices slide as inventories rise.   Home price slides mean more people walking away, less refi's, and less appraisal work.  

Secondly, home mortgage rates are expected to increase.  The Mortgage Bankers Association just said yesterday that as interest rates rise and the unemployment increases, it expects home loan originations to fall by 40% this year -their lowest level in a decade.   HousingWire said today:  "Yield Curve Can't Drive Profits If Banks Won't Lend," banks are not lending on real estate, and banks won't lend until rates rise.  Fannie Mae, Freddie Mac and FHA are all raising loan qualification standards.  All of this indicates less appraisal orders.  

However, FHA & RD Appraisal Orders Are BOOMING!  
Given the current mortgage market conditions, FHA and USDA Rural Development (RD) appraisal orders are booming.  RD Appraisal Assignments require FHA standards and placement on the FHA Roster.  FHA work is expected to remain a large portion of mortgage lending into 2010.

FHA Maintains Large Percentage Of Home Loans Into 2010!  
The 12/29/2009 Coester AppraisalNewscast stated that as much as 60% of home loans made in 2009 were FHA market share.   A recent 2010 HousingWire Update email stated that 4 of 10 home loans are FHA loans.  So, whether or not FHA lending makes up 40% or 60% of mortgage lending in 2010, one thing is certain:  It's a necessity for appraisers to remain on the FHA Roster.  

FHA Cracking Down On Appraisers!
It was reported in 2009 that, due to FHA loans defaults, FHA reserves had dwindled below 1%, causing the Wall Street Journal and others to question FHA's survivability.   It's my understanding that FHA is increasing scrutiny of appraisals in order to remain solvent.  Just today, Bloomberg is reporting: "U.S. Subpoenas 15 FHA Lenders With High Mortgage Defaults".  And, you can bet that FHA will looking at who the appraisers were that possibly helped those 15 lenders earn their high default status.  
 
The Necessity Of Remaining On The FHA Roster!  
So, with all of these challenges before the residential appraiser, it's important to remain on the FHA Roster, the roster that can provide 40% to 50% of an appraisers income going forward.


THE SOLUTION - The FHA Appraiser Inspection Course, Checklist and eManual!
On Real Estate Appraiser Tips, we try not to get bogged down in the news of the day but offer tips and solutions to get us beyond our challenges.   After reading through Lore DeAstra's and Continental Appraisal Consultant's FHA Inspection Course, eManual and using the Checklist in the field, I'm convinced that the use of the checklist will certainly aid in reminding not to forget any inspection items while onsite and consequently, remaining on the FHA roster by not committing careless errors.   For instance, one item I repeatedly forget to take note of is, how far the private sewer or water well is located from the home and to properly annotate the locations of such on the sketch.  The Checklist reminds me to do this.  Another example is the reminder to include photos of the crawl space, which is something I often forget to do.   With the elimination of the old "VC Sheet" in 2005, FHA inspections may not be as thorough as needed simply because of a lack of a checklist to follow during inspections.   This product solves that problem for appraisers.  

Another helpful feature of the eManual is the real life photo examples of possible FHA deficiencies with questions and discussion as to which answer is correct and why.    I knew that FHA had lessened some standards back in 2005 after it had lost so much mortgage market share, but this resource answers the extent of "current" FHA standards concisely.  

Here's the Description from the creator, Lore DeAstra:
"This new FHA Appraiser Inspection Course, Checklist and eManual is designed to get you up to speed on FHA appraising (no continuing education credit is available at this time). The course explains how to complete the two-page checklist line by line. The Checklist serves as a field guide for completing your reports. The eManual saves you time and money by summarizing and organizing the material you need to know. Author/appraiser Lore DeAstra says, "We reviewed more than 450 pages of HUD materials and spoke with several HUD officials to compile the FHA Appraiser Inspection Form, course materials, and eManual. It will save you time and money."


Here's A Couple Testimonials From Other  Users:

"The eManual is written for the appraiser needing to know the latest FHA requirements.  It is concise, yet contains all the newest appraisal requirements that are scattered throughout the volumes of FHA manuals, letters, etc. The included FHA Appraiser Inspection Checklist is a short two pages and still a reminder of those unusual situations not usually encountered.  This will keep the appraiser from omitting required items and having to return to the subject property." - C. Pierce. MAI, Appraiser +30 Yrs - Detroit, Michigan

"for anyone learning the new FHA regulations and guidelines, even if they have been appraising for years.  Utilizing the FHA Inspection Checklist and eManual are highly beneficial during the inspection and appraisal process.  Very Well Done!"  C. Fox, MSA, Real Estate Appraiser for +30 Years, Houston, Texas

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http://www.realestateappraisertips.info/ – Real Estate Appraiser Tips covers real estate appraiser related news and tips. Operated by Bill Cobb, CREA, a full time residential real estate appraiser in Louisiana. 225.953.0638 appraisertips@gmail.com