Changes in Appraisals are Hurting the Local Philadelphia Real Estate Market
Vic on Jan 2nd 2010
I recently saw this article about appraisals. The basic idea is that appraisal rules where changed in the boom market to prevent abuse and now those changes are hurting appraisals in this market. The rules where created to isolate appraisers from the influence of real estate pros like brokers, lenders etc.
During the boom times, real estate pros often exerted pressure on appraisers to give good appraisals to prevent deals from failing.
In the down market the rule change created a problem. To insulate themselves from lawsuits, lenders are ordering appraisals from appraisal management companies. These companies isolate banks from individual appraisers and reduce the risk of lawsuits.
Because these appraisal management companies are often national, they don’t have appraisers in every area so the appraisals are often NOT reflecting the local real estate market.
Read more to and know in advance if your lender is using an appraisal management company.
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