As the housing recovery continues, Americans are growing more confident in the housing market in general. And that confidence comes in part from a potentially surprising source: Millennial renters, who to date have been perceived by many as largely uninterested in and/or unable to attain homeownership.
Thursday, September 25, 2014
Guess Who's Driving Confidence in the Housing Market Now
The dream of homeownership remains a strong one among younger renters.
As the housing recovery continues, Americans are growing more confident in the housing market in general. And that confidence comes in part from a potentially surprising source: Millennial renters, who to date have been perceived by many as largely uninterested in and/or unable to attain homeownership.
As the housing recovery continues, Americans are growing more confident in the housing market in general. And that confidence comes in part from a potentially surprising source: Millennial renters, who to date have been perceived by many as largely uninterested in and/or unable to attain homeownership.
2014 FHA Loan Limits for High Cost Areas
FHA Loan Limit Changes Effective January 1, 2014
Loan limits for the country's highest-cost areas were reduced January 1, 2014.
The 2014 national maximum "ceiling" loan limit for a one-unit property in a high-cost area was reduced from $729,750 to $625,500. The current standard minimum "floor" loan limit for a one-unit property in a low-cost area will remain unchanged at $271,050.
Loan limits in other areas have also changed, with both increased and decreased loan limits in different areas.
In Special Exception Areas (Alaska, Guam, Hawaii and the U.S. Virgin Islands), the maximum "ceiling" loan limit for a one-unit property will be reduced from $1,094,625 to $938,250.
The following illustrates FHA loan limits for low-cost and high-cost areas.
Property Size Low-Cost Area "Floor" High-Cost Area "Ceiling"
One Unit $271,050 $625,500
Two Units $347,000 $800,775
Three Units $419,425 $967,950
Four Units $521,250 $1,202,925
For multiple-unit loan limit adjustments in Special Exception Areas, download the FHA's Mortgagee Letter. FHA loan limits are determined by the median home price in each county. Approximately 650 counties have lower limits as a result of this change in the governing law. FHA loans are extremely popular and currently account for about 25% of all loans used to purchase homes. With an FHA loan, buyers can put down as little as 3.5%. FHA loans are available as both fixed-rate loans and adjustable-rate loans.
43% Debt to Income Ratio Rolled Back!
New Mortgage Rules Won't Knock Out Many Borrowers
Lenders managed to win a reprieve on another piece of the standard, which is that a borrower’s total debt payments (including credit cards and student loans) can’t exceed 43 percent of income. Loans eligible for purchase by Fannie Mae (FNMA) or Freddie Mac (FMCC) or for insurance by federal agencies don’t have to meet that debt-to-income standard until 2021.
Multiple Credit Inquiry Impacts
Third party credit reviews or “hard inquiries” impact credit scores for 12 months from the date they occur even though they can be seen for 24 months. There are windows of time that a consumer can have multiple third party credit reviews and it will only impact the score as one inquiry. This happens only with mortgage, student loan, and car financing hard inquiries. Each of these categories has its own window where multiple credit reviews are considered as one. All other third party reviews can drop scores 2-5 points each time they occur.
When an individual has many hard inquiries or third party reviews it can be considered “excessive shopping” and reduce scores dramatically. In many cases 6 hard inquiries (in total) in a 12 month period are considered excessive shopping and can drop Fico credit scores 20-40 points. Depending on what threshold a mortgage applicant needs for loan approval or the best interest rate available this could devastate their options. If a consumer buys their own credit scores from the Fico site their credit scores will not drop, even if it’s 100 times a day. If a promotional credit card offer is extended it also will not reduce scores. These types of inquiries are considered “soft inquiries” and will not hurt credit scores at all. If the promotional offer was accepted by the consumer a hard inquiry would occur before the final approval on the offer is given by the creditor.
For First-Time Homebuyers: How to Dodge 5 Costly Rookie Mistakes
How to Dodge 5 Costly Rookie Mistakes
1. Searching for the dream home before getting prequalified for a loan.
Save yourself the disappointment of not being able to afford the home of your dreams by getting prequalified for your loan before you start house hunting. Instead of picking out a price range and searching listings, take the time to talk to a lender about how much house you can realistically afford and what the monthly payment breakdown -– with all taxes and other fees included –- will be. The amount you are preapproved for will help you create a realistic budget for your home search.
2. Delaying the buying process in hopes of a better rate.
Economic Event
As of August 2013,
Mortgage customers that can document an "Economic Event" are no longer required to wait the standard seasoning time for bankruptcies, short sales & foreclosures. Rather than waiting (2) years for BK & (3) years for short sale/foreclosure borrowers are able to purchase within 1 year of the event as long as the following is true:
• Household income (at the time) dropped at least 20% and continued for at least a six month period.
• All credit was well maintained up until the event AND the borrower now has 12 month paid as agreed credit ~ this includes Non-Traditional
• Borrower(s) have completed HUD's Satisfactory Housing Counseling.
40 Million Mistakes: Is your credit report accurate?
40 Million Mistakes: Is your credit report accurate?A new study indicates as many as 40 million consumers have a mistake on their credit report and Steve Kroft finds it's hard to get them fixed. A must see video that will open your eyes on how hard it is to get errors on credit reports corrected.
Market Conditions and Analysis for Mortgage and Housing Professionals
Good article on strategy for presentations by housing professionals. Shows what market demographics indicate are the buying trends by age group.
Market Conditions and Analysis for Mortgage and Housing Professionals
Tuesday, January 3, 2012
Pending home sales post solid gains two months in a row
There are signs that housing is coming off a second bottom as pending existing home sales rose a very strong 7.3 percent in November on top of October's 10.4 percent gain. Regionally, November's gains were led by the West and include the Northeast and Midwest with the South showing no change. November and October taken together show solid gains for all regions. The index is at its highest level since April 2010.
Recent sales increases have been helped by lower mortgage rates and lower home prices along with a somewhat improved jobs picture.
There is some speculation that the pending sales data are getting a boost, and are likely to continue to get a boost, from re-signings by homebuyers who had prior contracts voided for technical reasons such as missing deadlines due to financing snags. There have been reports that the failure rate of contracts (not going to closing) has risen significantly due to tighter lending standards.
Source: Barron's Online 1/3/2012
Friday, December 30, 2011
2012 Goal Setting
I have been studying goal setting for years now, and doing presentations on the topic.
It never ceases to amaze that the one simple act of writing goals down makes such a tremendous difference. Even when none of the finer points of effective goal setting are employed, it never fails that many of the written goals have been achieved by the time they are reviewed.
I will be offering free personal coaching on the topic to my business associates locally (San Diego area) in the 1st quarter of 2012. Just drop me a call or an email.
Even if we haven't met, send an email and I will send you the reasons most New Year's resolutions fail, the mistakes people make in goal setting, and links to the best mobile, online and computer apps for goal setting to help you get started!
Tuesday, November 22, 2011
New Higher FHA Loan Limits Signed Into Law Friday
President Obama signed into law Friday H.R. 2112, a bill that among other things has raised the mortgage limit on Federal Housing Administration (FHA) loans. On October 1st of this year, the lending limits for high cost areas was slashed, with the national maximum being reduced from $729,750 to $625,000 and San Diego County's maximum also declining from $697,500 to $546,250. This bill will extend the pre-October 1st high cost area limits from now through December 2013. This increased limit only applies to loans backed by the FHA, as Fannie Mae and Freddie Mac loans were not included in this bill.
This raising of mortgage limits was done for those in high cost areas who simply cannot get a home for the same prices as those in other areas of the country. FHA was created to help low and middle income families acquire loans with very little down payment, encouraging home buying for those who can afford their monthly mortgage payment but otherwise might struggle to come up with the down payment. San Diego is a prime example of a high cost area. The national limit for FHA basic standard mortgages is now 271,050.00. A quick Zillow search of single family homes yielded 21,279 homes on the market in San Diego County. Of those only 9,844 were priced lower than the national limit, the majority being condos or apartments. San Diego is an expensive market to live in, therefore what is considered middle class housing here is higher than in places such as the Midwest. This bill will remove the penalty of living in an expensive region of the country and provide opportunities to purchase great homes for the middle class. If one couples the FHA loans low down payments with the historically low interest rates, this bill will enable more middle class families to afford homes in the county.
This bill will be beneficial to San Diegans, as there will be far more homes eligible for FHA loans and refinancing. Another Zillow search for homes between the prices of $546,250 (previous limit) and $697,500(new limit) shows 1521 homes. This means that 1521 homes in San Diego are now eligible under the FHA programs that were previously ineligible. The FHA wants to encourage home buying, as it stimulates economic growth. With so many more eligible homes home buying should increase, helping both our local and national economies after what has been a rough few years. Purchasing a home now while prices, down payments, and interest rates are low is an excellent investment in the future, and the FHA can make this possible for you.
Monday, November 14, 2011
More Personal Information in the Credit Report
Consumers applying for a mortgage will be sharing more of their personal information with lenders next year.
FICO scores have been based on a person's credit history. But now, tools are being developed to help the lending industry dig deeper.
Fair Isaac Corp., and CoreLogic recently announced a joint project that will result in a separate score that will be available to mortgage lenders and will include payday loans, evictions and child support payments. In the future, the status of utility, rent and cellphone payments may also be included.
Experian, Equifax and TransUnion have recently begun providing estimates of consumer income as an option to the credit report. Experian has also begun including data on on-time rental payments in its reports as of this year.
All this new information could have positive or negative impact for consumers: It may open the door to homeownership to some consumers who otherwise lack sufficient credit histories, and it may help more affluent homeowners who show little use of credit.
On the negative side, the extra information could make a borderline borrower look even worse on paper.
The FICO-CoreLogic partnership will not result in a credit score that will eliminate a borrower for a mortgage backed by FNMA, FHLMC or FHA. This is because the report required for such a loan does not rely on the additional CoreLogic data. It could affect mortgage fees or interest rates charged by lenders who use a risk-based pricing model.This model rewards the most creditworthy borrowers with low rates and tack extra fees onto loans for those with lower credit scores.
It will be interesting to see if the new information will actually expand the number of people who can get a mortgage.
Tuesday, October 25, 2011
New Home Affordable Refinance Program (HARP II)
Yesterday, Oct 24, 2011, President Obama announced changes to the Making Home Affordable Refinance Program (HARP) so that a person can refinance a first mortgage that is upside-down.
That mortgage must be owned by Fannie Mae or Freddie Mac on or before May 31,2009.
The changes announced yesterday also extend the program to the end of 2013, and will allow a refinance of a first mortgage with no cap on the loan-to-value (LTV) ratio.
Another important enhancement is the elimination of certain risk-based fees for borrowers who choose a shorter term (see examples below) and lowering fees for other borrowers.
No lenders are offering the program yet, although some major lenders have stated they are working on it’s release.
The requirements released to date are as follows:
1. 1st mortgage owned by Fannie Mae or Freddie Mac
2. No late mortgage payments within the previous 6 months
3. No more than 1 late mortgage payment within the past 12 months
4. 2nd mortgages must agree to go back in 2nd position
5. The loan cannot have been refinanced previously under HARP unless it was between March-May of 2009.
6. Condominiums continue to be eligible under the program.
Lenders are expected to receive guidelines, including implementation dates by November 15, 2011.
Some of the enhancements may be available as early as December 1, 2011,
However, availability of the loan for LTV's greater than 125 is not expected until after December 31, 2011.
The FHFA announcement can be found here:
http://www.fhfa.gov/webfiles/22721/HARP%20release%20102411%20Final.pdf
The program is only one of many refinancing options available to homeowners. It is unique in that it enables borrowers who owe more than the home is worth to take advantage of low interest rates and other refinancing benefits.
Examples*
Assume a homeowner currently has a mortgage on which he or she owes $200,000 and
has an interest rate of 6.5 percent – a monthly payment of $1264. If the house is worth $160,000, the homeowner has a current loan-to-value (LTV) ratio of 125 percent.
*These examples are purely illustrative and are not meant to represent interest rates borrowers should expect to pay. They do show that some HARP-eligible borrowers, depending on their circumstances and priorities, may benefit from a shorter term mortgage.
Friday, October 21, 2011
Are FHA Mortgage Loans Assumable?
You can assume an existing FHA-insured loan, or, if you are the one deciding to sell, allow a buyer to assume yours. Assuming a loan can be very beneficial, since the process is streamlined and less expensive compared to that for a new loan. You must demonstrate that you have enough income to support the mortgage loan. In this way, qualifying to assume a loan is similar to the qualification requirements for a new mortgage loan. After closing, you will then be responsible for an annual premium - paid monthly - if your mortgage is over 15 years or if you have a 15-year loan with an LTV greater than 90%.
Here is how assumable FHA loans benefit the buyer:
The benefits are two fold. The buyer may get an interest rate that is much lower than the current interest rate they could get from a bank AND they have an accelerated pay off schedule because there are less years remaining on the note!
The FHA mortgage is one of the most expensive when it comes to closing costs, although the costs can be financed. To counter that cost, it helps to remember that your FHA mortgage is assumable. When you sell your property you will have an edge over your competition because of the assumable financing you can offer.
The value of assumability is as high as it is ever likely to be because of the broad consensus that interest rates in future years will be higher than they are now.
Loans insured by the FHA are assumable; conventional loans, with a few exceptions, are not. That means that a home buyer who finances the purchase with an FHA-insured loan and who sells the house later, when interest rates are higher, will be able to offer a potential buyer the right to assume his low-rate FHA loan.
After approval of the buyer by the FHA, the buyer would assume all the obligations of the mortgage upon the sale of the property, and the seller would be relieved of liability, provided the loan being assumed was originated after December 14, 1989. It will be just as if the loan had been made to the buyer.
Here is how assumable FHA loans benefit the buyer:
The benefits are two fold. The buyer may get an interest rate that is much lower than the current interest rate they could get from a bank AND they have an accelerated pay off schedule because there are less years remaining on the note!
The FHA mortgage is one of the most expensive when it comes to closing costs, although the costs can be financed. To counter that cost, it helps to remember that your FHA mortgage is assumable. When you sell your property you will have an edge over your competition because of the assumable financing you can offer.
The value of assumability is as high as it is ever likely to be because of the broad consensus that interest rates in future years will be higher than they are now.
Loans insured by the FHA are assumable; conventional loans, with a few exceptions, are not. That means that a home buyer who finances the purchase with an FHA-insured loan and who sells the house later, when interest rates are higher, will be able to offer a potential buyer the right to assume his low-rate FHA loan.
After approval of the buyer by the FHA, the buyer would assume all the obligations of the mortgage upon the sale of the property, and the seller would be relieved of liability, provided the loan being assumed was originated after December 14, 1989. It will be just as if the loan had been made to the buyer.
Friday, September 30, 2011
Waiting Period After Short Sale of a Home Purchased with a VA Loan
Borrowers are required to wait for two years before applying for a new VA home loan. A qualifying credit score and a record of dependable payments during the waiting period following a short sale is required.
Borrowers must apply to have their VA loan eligibility restored by filing a copy of VA Form 26-1880 to the Winston-Salem Eligibility Center.
One thing could prevent a buyer from getting eligibility restored right away. If the VA paid a compromise claim as part of a short sale, the borrower may be indebted to the government as a result of that claim. The Department of Veterans Affairs may not restore eligibility if the applicant still owes money to the government.
Here is the specific wording:
“…although the veteran’s debt was waived by VA, the Government still suffered a loss on the loan. The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.”
If a VA loan applicant is notified that a debt to the government exists, or was aware of the debt prior to applying for the loan, the applicant should contact the VA directly to work out the details of repayment before applying for a new VA mortgage.
A borrower may still be able to take advantage of any unused VA loan eligibility. Any remaining entitlement may be allowed if a borrower did not use the full entitlement on the previous VA mortgage.
A borrower’s debt for a compromise claim may be factored into the debt-to-income ratio, unless the lender feels the compromise claim debt is too great compared to other financial factors. That debt may result in the need for a down payment, or a larger down payment than usual – requirements will vary from lender to lender.
Borrowers must apply to have their VA loan eligibility restored by filing a copy of VA Form 26-1880 to the Winston-Salem Eligibility Center.
One thing could prevent a buyer from getting eligibility restored right away. If the VA paid a compromise claim as part of a short sale, the borrower may be indebted to the government as a result of that claim. The Department of Veterans Affairs may not restore eligibility if the applicant still owes money to the government.
Here is the specific wording:
“…although the veteran’s debt was waived by VA, the Government still suffered a loss on the loan. The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.”
If a VA loan applicant is notified that a debt to the government exists, or was aware of the debt prior to applying for the loan, the applicant should contact the VA directly to work out the details of repayment before applying for a new VA mortgage.
A borrower may still be able to take advantage of any unused VA loan eligibility. Any remaining entitlement may be allowed if a borrower did not use the full entitlement on the previous VA mortgage.
A borrower’s debt for a compromise claim may be factored into the debt-to-income ratio, unless the lender feels the compromise claim debt is too great compared to other financial factors. That debt may result in the need for a down payment, or a larger down payment than usual – requirements will vary from lender to lender.
Monday, September 26, 2011
Are VA Loans Assumable?
An assumable loan allows the buyer to take over the obligation of the seller's loan
with no change in loan terms. Generally, a loan without a "Due-On-Sale Clause" is assumable.
Advantages:
If loan rates have increased since the seller got the loan, the old loan may carry a lower interest rate than a new loan, and the buyer won't have to pay as much in fees.
Also, more of the monthly payments on the loan will be going toward the principal balance instead of interest because the loan term will be reduced by the time since the loan began.
VA Assumablility
There are two ways to assume a VA loan,but only one of them is a good idea for the seller.
First, if the new buyer is a qualified Veteran, he can "substitute" his eligibility for the eligibility of the seller. In addition, the new buyer qualifies through VA standards for the mortgage payment.
This is the safest way for a seller to allow their loan to be assumed. The new buyer is responsible for the loan and the seller has no further liablility for the repayment of the loan. By obtaining a "release of liability" from the VA, the seller can then use their full eligibility to purchase another home right away using their VA loan.
The second way is if the new buyer is not a veteran or qualified for a VA loan, they have no eligibility to give the seller. If the seller grants permission for the new buyer to take over their loan, the seller does not get back their eligibility to use on another home, and the seller is still liable for the payments should the buyer default!
For this reason, A VA seller and their realtor, should be very careful about offering their home with an assumable loan.
with no change in loan terms. Generally, a loan without a "Due-On-Sale Clause" is assumable.
Advantages:
If loan rates have increased since the seller got the loan, the old loan may carry a lower interest rate than a new loan, and the buyer won't have to pay as much in fees.
Also, more of the monthly payments on the loan will be going toward the principal balance instead of interest because the loan term will be reduced by the time since the loan began.
VA Assumablility
There are two ways to assume a VA loan,but only one of them is a good idea for the seller.
First, if the new buyer is a qualified Veteran, he can "substitute" his eligibility for the eligibility of the seller. In addition, the new buyer qualifies through VA standards for the mortgage payment.
This is the safest way for a seller to allow their loan to be assumed. The new buyer is responsible for the loan and the seller has no further liablility for the repayment of the loan. By obtaining a "release of liability" from the VA, the seller can then use their full eligibility to purchase another home right away using their VA loan.
The second way is if the new buyer is not a veteran or qualified for a VA loan, they have no eligibility to give the seller. If the seller grants permission for the new buyer to take over their loan, the seller does not get back their eligibility to use on another home, and the seller is still liable for the payments should the buyer default!
For this reason, A VA seller and their realtor, should be very careful about offering their home with an assumable loan.
Tuesday, September 20, 2011
New California Maximum FHA purchase price with 3.5% Down 10/1/2011
| County | Max FHA Price |
| Alameda | $648,187 |
| Alpine | $480,259 |
| Amador | $344,404 |
| Butte | $303,886 |
| Calaveras | $387,306 |
| Colusa | $280,881 |
| Contra Costa | $648,187 |
| Del Norte | $280,881 |
| El Dorado | $492,176 |
| Fresno | $291,969 |
| Glenn | $280,881 |
| Humboldt | $339,637 |
| Imperial | $280,881 |
| Inyo | $382,539 |
| Kern | $280,881 |
| Kings | $280,881 |
| Lake | $280,881 |
| Lassen | $280,881 |
| Los Angeles | $648,187 |
| Madera | $280,881 |
| Marin | $648,187 |
| Mariposa | $333,679 |
| Mendocino | $387,306 |
| Merced | $280,881 |
| Monterey | $500,518 |
| Napa | $613,731 |
| Nevada | $494,560 |
| Orange | $648,187 |
| Placer | $492,176 |
| Plumas | $349,171 |
| Riverside | $368,238 |
| Sacramento | $492,176 |
| San Benito | $648,187 |
| San Bernardino | $368,238 |
| San Diego | $566,062 |
| San Francisco | $648,187 |
| San Joaquin | $315,803 |
| San Luis Obispo | $581,554 |
| San Mateo | $648,187 |
| Santa Barbara | $648,187 |
| Santa Clara | $648,187 |
| Santa Cruz | $648,187 |
| Shasta | $283,627 |
| Siskiyou | $280,881 |
| Solano | $414,715 |
| Sonoma | $539,845 |
| Stanislaus | $286,010 |
| Sutter | $280,881 |
| Tehama | $280,881 |
| Tulare | $280,881 |
| Tuolumne | $343,212 |
| Ventura | $619,689 |
| Yolo | $492,176 |
| Yuba | $280,881 |
New California Maximum Loan Limits FHA & Conventional October 2011
| County | Maximum Loan |
| Alameda | 625,500 |
| Alpine | 463,450 |
| Amador | 332,350 |
| Butte | 293,250 |
| Calaveras | 373,750 |
| Colusa | 271,050 |
| Contra Costa | 625,500 |
| Del Norte | 271,050 |
| El Dorado | 474,950 |
| Fresno | 281,750 |
| Glenn | 271,050 |
| Humboldt | 327,750 |
| Imperial | 271,050 |
| Inyo | 369,150 |
| Kern | 271,050 |
| Kings | 271,050 |
| Lake | 271,050 |
| Lassen | 271,050 |
| Los Angeles | 625,500 |
| Madera | 271,050 |
| Marin | 625,500 |
| Mariposa | 322,000 |
| Mendocino | 373,750 |
| Merced | 271,050 |
| Monterey | 483,000 |
| Napa | 592,250 |
| Nevada | 477,250 |
| Orange | 625,500 |
| Placer | 474,950 |
| Plumas | 336,950 |
| Riverside | 355,350 |
| Sacramento | 474,950 |
| San Benito | 625,500 |
| San Bernardino | 355,350 |
| San Diego | 546,250 |
| San Francisco | 625,500 |
| San Joaquin | 304,750 |
| San Luis Obispo | 561,200 |
| San Mateo | 625,500 |
| Santa Barbara | 625,500 |
| Santa Clara | 625,500 |
| Santa Cruz | 625,500 |
| Shasta | 273,700 |
| Siskiyou | 271,050 |
| Solano | 400,200 |
| Sonoma | 520,950 |
| Stanislaus | 276,000 |
| Sutter | 271,050 |
| Tehama | 271,050 |
| Tulare | 271,050 |
| Tuolumne | 331,200 |
| Ventura | 598,000 |
| Yolo | 474,950 |
| Yuba | 271,050 |
Tuesday, September 13, 2011
New UAD Forms and Codes
These are the four new required Appraisal forms, effective Sept 1, 2011 for all FNMA/FHLMC transactions.
Uniform Residential Appraisal Report (Fannie Mae Form 1004/Freddie Mac Form 70)
Individual Condominium Unit Appraisal Report (Fannie Mae Form 1073/Freddie Mac Form 465)
Exterior-Only Inspection Individual Condominium Unit Appraisal Report (Fannie Mae Form 1075/Freddie Mac Form 466)
Exterior-Only Inspection Residential Appraisal Report (Fannie Mae/Freddie Mac Form 2055)
Here is the checklist for the new codes:
UAD‐01: Real estate taxes and/or special assessments are to be entered in whole dollars only.
UAD‐02: If there are no HOA fees or Special Assessments, enter the numeral zero (0).
UAD‐03: If there is a HOA or the subject is a condo, answer yes or no for the question, “Is the
developer/builder in control of the Homeowners’ Association (HOA)?”
UAD‐04: If the subject property is currently offered for sale or has been offered for sale in the 12 months
prior, report the data source(s) used, offering price(s), Days on Market and date(s). If the answer is ‘No,’ the
data source(s) used must be provided.
UAD‐05: For a purchase transaction, in the contract section state what the sale type is.
UAD‐06: Provide an outline of the neighborhood boundaries clearly delineated using ‘North’, ‘South’, ‘East’,
and ‘West’
UAD‐07: For sites/parcels that have an area of less than one acre, the size must be reported in square feet ‐
whole numbers only. For sites/parcels that have an area of one acre or greater, the size must be reported in
acreage to two decimal places. The unit of measure must be indicated as either ‘sf’ for square feet or ‘ac’ for
acres. (for subject and comparables)
UAD‐08: View rating must be N, B or A along with an abbreviated factor. (site section and grid)
UAD‐09: For utilities, other must be accompanied with a description; if it is not present, enter ‘None’.
UAD‐10: Indicate whether the street or alley type is ‘Public’ and/or ‘Private’. Enter ‘None’ in the appropriate
description field if there is no street or alley.
UAD‐11: # of stories (and # of levels for a condo) can only be numeric; omit descriptors.
UAD‐12: If there is commercial space in the condo project, check yes at the bottom of page 1and indicate
overall % of commercial space – 2 digits, whole numbers only.
UAD‐13: Design style should be an architectural design such as ‘Colonial’, ‘Rambler’ ect. Descriptors such as ‘2
stories’ or ‘conventional’ are not architectural styles.
UAD‐14: If year date is unknown, estimate the year it was built with a tilde (~) preceding the year built.
UAD‐15: Indicate the basement size in square feet and the percentage of the basement that is finished. If there
is no basement, enter the numeral zero (0) in both fields ‐ whole numbers only.
UAD‐16: If there is no heating or cooling source, indicate ‘Other’ and enter ‘None’.
UAD‐17: For amenities, enter the numeral zero (0) in the appropriate space if there are no fireplaces or
woodstoves. Enter ‘None’ in the appropriate space if there is no patio/deck, pool, fence, porch, or other
amenity.
UAD‐18: For car storage, enter the number of spaces in whole numbers only for each type. If none, enter the
numeral zero (0) for # of cars.
UAD‐19: Baths should include the total number of baths above grade. A three‐quarter bath is to be counted as
a full bath in all cases. Quarter baths (baths that feature only a toilet) are not to be included in the bathroom
count. The number of full and half baths must be entered, separated by a period. The full bath count is
represented to the left of the period. The half bath count is represented to the right of the period.
UAD‐20: Condition must state the rating, then indicate ‘Yes’ or ‘No’ if there has been any material work done
to the kitchen(s) or bathroom(s) in the prior 15 years. If ‘No’, the text ‘No updates in the prior 15 years’ must
be provided; if ‘Yes’, additional information for kitchens and bathrooms must be provided including ‘not
updated’, ‘updated’ or ‘remodeled’ and the timeframe.
UAD‐21: Condition rating (for the subject and comps) must be in UAD format; select one of the following: C1,
C2, C3, C4, C5 or C6.
UAD‐22: Addresses for the comparables must include the address, city, state and zip code.
UAD‐23: Proximity must be in miles and 2 decimal places, along with the word ‘miles’ and direction (NW).
UAD‐24: The subject sales price must match the contract price in whole dollars.
UAD‐25: Data source for comparables must be given with the identifying number; then DOM must appear. If
not listed, enter numeral zero (0). If DOM is unknown, enter ‘Unk’.
UAD‐26: Indicate the sales type for each comparable property with the UAD abbreviation.
UAD‐27: Enter the financing type in UAD abbreviation; and total amount of concessions. If none, enter the
numeral zero (0). If other, indicate if sales transactions with below‐market financing are used for comparable
sales.
UAD‐28: Enter the status type abbreviation for the settlement date; followed by the contract date in mm/yy
format. Use ‘Unk’ if the contract date is unknown.
UAD‐29: Location rating must be N, B or A along with an abbreviated factor.
UAD‐30: Actual age for a new construction less than a year old should be (0) do not enter additional
information such as ‘years’. If actual age is unknown, estimate the age with a preceding tilde (~).
UAD‐31: Quality of construction rating (for the subject and comps) must be in UAD format; select one of the
following: Q1, Q2, Q3, Q4, Q5 or Q6.
UAD‐32: If no basement, enter (0) in the grid, otherwise indicate finished sq ft, do not indicate a % finished.
Type of access should be wo, wu or in. Then indicate the type of finished rooms by abbreviation or enter (0)
if there are no rooms of a particular type.
UAD‐33: Enter any energy efficient items or enter ‘None’.
UAD‐34: Off‐street parking spaces are to be entered on the garage/carport line or enter ‘None’.
UAD‐35: If no adjustment is warranted, enter a zero (0). When the features are the same, leave the field blank.
UAD‐36: Active listings must state ‘Active’ in the date field.
UAD‐37: Leave the supervisory appraiser field blank; do not enter N/A or none.
UAD‐38: AMC name should be entered in the Lender/Client section of the certification only
Interior/Exterior Complete Inspection Reports:
Overall Condition Rating – The appraiser must select one of the following ratings
that best describes the overall condition of the subject property or unit. Only one selection is permitted. The rating for the subject property must match the overall condition rating that is reported in the
Sales Comparison Approach section.
C1
C2
C3
C4
C5
C6
The definitions for the ratings listed above are provided in Exhibit 1:
Level of Work Completed:
not updated
updated
remodeled
Definitions for the Level of Work Completed are provided in Exhibit 2:
Requirements – Definitions of Not Updated, Updated, and Remodeled.
Timeframes:
less than one year ago
one to five years ago
six to ten years ago
eleven to fifteen years ago
timeframe unknown
Uniform Residential Appraisal Report (Fannie Mae Form 1004/Freddie Mac Form 70)
Individual Condominium Unit Appraisal Report (Fannie Mae Form 1073/Freddie Mac Form 465)
Exterior-Only Inspection Individual Condominium Unit Appraisal Report (Fannie Mae Form 1075/Freddie Mac Form 466)
Exterior-Only Inspection Residential Appraisal Report (Fannie Mae/Freddie Mac Form 2055)
Here is the checklist for the new codes:
UAD‐01: Real estate taxes and/or special assessments are to be entered in whole dollars only.
UAD‐02: If there are no HOA fees or Special Assessments, enter the numeral zero (0).
UAD‐03: If there is a HOA or the subject is a condo, answer yes or no for the question, “Is the
developer/builder in control of the Homeowners’ Association (HOA)?”
UAD‐04: If the subject property is currently offered for sale or has been offered for sale in the 12 months
prior, report the data source(s) used, offering price(s), Days on Market and date(s). If the answer is ‘No,’ the
data source(s) used must be provided.
UAD‐05: For a purchase transaction, in the contract section state what the sale type is.
UAD‐06: Provide an outline of the neighborhood boundaries clearly delineated using ‘North’, ‘South’, ‘East’,
and ‘West’
UAD‐07: For sites/parcels that have an area of less than one acre, the size must be reported in square feet ‐
whole numbers only. For sites/parcels that have an area of one acre or greater, the size must be reported in
acreage to two decimal places. The unit of measure must be indicated as either ‘sf’ for square feet or ‘ac’ for
acres. (for subject and comparables)
UAD‐08: View rating must be N, B or A along with an abbreviated factor. (site section and grid)
UAD‐09: For utilities, other must be accompanied with a description; if it is not present, enter ‘None’.
UAD‐10: Indicate whether the street or alley type is ‘Public’ and/or ‘Private’. Enter ‘None’ in the appropriate
description field if there is no street or alley.
UAD‐11: # of stories (and # of levels for a condo) can only be numeric; omit descriptors.
UAD‐12: If there is commercial space in the condo project, check yes at the bottom of page 1and indicate
overall % of commercial space – 2 digits, whole numbers only.
UAD‐13: Design style should be an architectural design such as ‘Colonial’, ‘Rambler’ ect. Descriptors such as ‘2
stories’ or ‘conventional’ are not architectural styles.
UAD‐14: If year date is unknown, estimate the year it was built with a tilde (~) preceding the year built.
UAD‐15: Indicate the basement size in square feet and the percentage of the basement that is finished. If there
is no basement, enter the numeral zero (0) in both fields ‐ whole numbers only.
UAD‐16: If there is no heating or cooling source, indicate ‘Other’ and enter ‘None’.
UAD‐17: For amenities, enter the numeral zero (0) in the appropriate space if there are no fireplaces or
woodstoves. Enter ‘None’ in the appropriate space if there is no patio/deck, pool, fence, porch, or other
amenity.
UAD‐18: For car storage, enter the number of spaces in whole numbers only for each type. If none, enter the
numeral zero (0) for # of cars.
UAD‐19: Baths should include the total number of baths above grade. A three‐quarter bath is to be counted as
a full bath in all cases. Quarter baths (baths that feature only a toilet) are not to be included in the bathroom
count. The number of full and half baths must be entered, separated by a period. The full bath count is
represented to the left of the period. The half bath count is represented to the right of the period.
UAD‐20: Condition must state the rating, then indicate ‘Yes’ or ‘No’ if there has been any material work done
to the kitchen(s) or bathroom(s) in the prior 15 years. If ‘No’, the text ‘No updates in the prior 15 years’ must
be provided; if ‘Yes’, additional information for kitchens and bathrooms must be provided including ‘not
updated’, ‘updated’ or ‘remodeled’ and the timeframe.
UAD‐21: Condition rating (for the subject and comps) must be in UAD format; select one of the following: C1,
C2, C3, C4, C5 or C6.
UAD‐22: Addresses for the comparables must include the address, city, state and zip code.
UAD‐23: Proximity must be in miles and 2 decimal places, along with the word ‘miles’ and direction (NW).
UAD‐24: The subject sales price must match the contract price in whole dollars.
UAD‐25: Data source for comparables must be given with the identifying number; then DOM must appear. If
not listed, enter numeral zero (0). If DOM is unknown, enter ‘Unk’.
UAD‐26: Indicate the sales type for each comparable property with the UAD abbreviation.
UAD‐27: Enter the financing type in UAD abbreviation; and total amount of concessions. If none, enter the
numeral zero (0). If other, indicate if sales transactions with below‐market financing are used for comparable
sales.
UAD‐28: Enter the status type abbreviation for the settlement date; followed by the contract date in mm/yy
format. Use ‘Unk’ if the contract date is unknown.
UAD‐29: Location rating must be N, B or A along with an abbreviated factor.
UAD‐30: Actual age for a new construction less than a year old should be (0) do not enter additional
information such as ‘years’. If actual age is unknown, estimate the age with a preceding tilde (~).
UAD‐31: Quality of construction rating (for the subject and comps) must be in UAD format; select one of the
following: Q1, Q2, Q3, Q4, Q5 or Q6.
UAD‐32: If no basement, enter (0) in the grid, otherwise indicate finished sq ft, do not indicate a % finished.
Type of access should be wo, wu or in. Then indicate the type of finished rooms by abbreviation or enter (0)
if there are no rooms of a particular type.
UAD‐33: Enter any energy efficient items or enter ‘None’.
UAD‐34: Off‐street parking spaces are to be entered on the garage/carport line or enter ‘None’.
UAD‐35: If no adjustment is warranted, enter a zero (0). When the features are the same, leave the field blank.
UAD‐36: Active listings must state ‘Active’ in the date field.
UAD‐37: Leave the supervisory appraiser field blank; do not enter N/A or none.
UAD‐38: AMC name should be entered in the Lender/Client section of the certification only
Interior/Exterior Complete Inspection Reports:
Overall Condition Rating – The appraiser must select one of the following ratings
that best describes the overall condition of the subject property or unit. Only one selection is permitted. The rating for the subject property must match the overall condition rating that is reported in the
Sales Comparison Approach section.
C1
C2
C3
C4
C5
C6
The definitions for the ratings listed above are provided in Exhibit 1:
Level of Work Completed:
not updated
updated
remodeled
Definitions for the Level of Work Completed are provided in Exhibit 2:
Requirements – Definitions of Not Updated, Updated, and Remodeled.
Timeframes:
less than one year ago
one to five years ago
six to ten years ago
eleven to fifteen years ago
timeframe unknown
Monday, August 29, 2011
New Appraisal Guidelines moved back to Jan 1, 2012 for FHA/HUD
On Monday August 22nd, Mortgagee Letter 2011-30 announced that the deadline for the new Uniform Appraisal Dataset (UAD) requirements has been pushed back to January 1. It will apply to FHA financed purchases (with case numbers assigned on or after Jan 1), and all HUD real estate owned (REO) and Pre-Foreclosure Sale (PFS) properties with an effective date on or after January 1, 2012.
The aim is to streamline the appraisal process and make appraisals more uniform. Appraisal management companies are working to teach and train appraisers to use the UAD, which will change the way appraisals are documented by setting standards throughout the appraisal process.
The UAD is part of a larger effort toward improving the appraisal process. In addition, a Uniform Collateral Data Portal (UCDP) will enable lenders to submit appraisal report forms electronically. Either format may be used in advance of the January 1 implementation date.
Previously, the implementation date for the UAD was set to September 1.
The aim is to streamline the appraisal process and make appraisals more uniform. Appraisal management companies are working to teach and train appraisers to use the UAD, which will change the way appraisals are documented by setting standards throughout the appraisal process.
The UAD is part of a larger effort toward improving the appraisal process. In addition, a Uniform Collateral Data Portal (UCDP) will enable lenders to submit appraisal report forms electronically. Either format may be used in advance of the January 1 implementation date.
Previously, the implementation date for the UAD was set to September 1.
Subscribe to:
Posts (Atom)