Mortgage Appraisal Values
Appraisal question- appreciating market?
I have a theoretical question for anyone who knows about the appraisal-mortgage value link. It is my understanding that banks won’t lend more than the appraisal says the home is worth. Also, the appraisal is based on comps that are past sales of nearby, similar properties.
Since the appraisal is based on past sales, you would get a low estimate of the home’s value in an appreciating market (since the comp transactions took place at a lower price). The bank therefore would only be willing to lend the low estimate of the home’s value. Given this limitation, how did home prices escalate so rapidly from 2000-2005? It seems there is a built in throttle check on appreciation in the appraisal-lending value link.
As an appraiser we make adjustments for time. If we use sales that occurred let’s say 3 months ago and we know the market is appreciating 10% per year we would add 2.5% (quarterly) or .83% monthly to the value to reflect the time changes. The market in some areas where appreciating 20%-30% per year during the boom and the appraiser would adjust accordingly. Appraisals are more of an art than a science. An example three houses sold in January 2007 for 350-360k. There is an anticipated 10% appreciation for 2007 and the house being appraised is in good condition towards 360k and is appraised in April. There would a 2.5% + .83%=3.3 or 3.5% (rounded) increase for time or $12,600 + 360,000 = 372,600 or 373k rounded. This figure would reflect what a typical buyer would pay for the property with adequate exposure on the market for 3-6 months between two non related parties, with no unusual circumstances such as time constraints.
avoid Foreclosure-Drop mortgage balance To appraised value-lower house payment
VA home loans a great perk for G.I. Joes
Dear Real Estate Adviser, I’ll be retiring from the military after 20-plus years and transitioning into the civilian work force. I’ve been told I should buy a home now before I get out because my risk profile will be re-evaluated after a year, as if I was just getting out of college.
The above mentioned are the basic requirements in order to qualify for a home loan. Secondly, I was interested to know how big a home loan I could get considering Mortgage Appraisal Values. As soon as I knew how much, I could start searching for a house.
Mortgage Appraisal Values
How long does it take to close with owner financing when the owner has a mortgage?
In other words, what time-consuming activities have to happen before closing, when the owner providing the financing is already satisfied of the property’s value and condition, so there is no need for additional inspection, appraisal, etc.?
I assume the key issues are paying off the owner’s mortgage, recording the owner-financed mortgage, and getting the title transferred to the new owner. But do those get done before or after closing?
The owner’s liquid assets plus the seller’s down payment will add up to enough to pay off ther owner’s mortgage.
if you want title insurance (and you do) that could take a couple of weeks. other than that this could be done in a few days.
just schedule a closing with title company.