Real Estate Information

Luxury Real Estate Information


Rancho Palos Verdes, California Homes
Palos Verdes, California Homes
South Bay, California Homes
Luxury Mexican Beachfront Homes

Featured Properties


Oceanfront Estate Near Trump National

Related Information


Loan Information
Real Estate Information
Mortgage Refinance Information

Home Equity Loans - Beware of Appraisal Fraud


A new report by the independent Demos group has revealed what may not be a surprise to many people - corruption is rampant in the home appraisal industry. The bust in the dot-com market of some five years ago has left would-be lenders with a surplus of cash to lend. This has led to a huge boom in both mortgage and home equity loan lending. That's not a bad thing; a record 69% of Americans now own their own homes. Owning a home is easier than ever; in 2004 the average down payment was a record low of only three percent.

So if everyone is buying a home, and loans are easier to obtain than ever, what is the problem? The problem is that nearly 55% of the appraisers polled in the survey said that they had been pressured by lenders to deliver appraisals that met a "target" value. The appraisers said that failure to meet the "target" value resulted in either their not being paid, or not being hired again. Since most appraisers want to keep working, they have had a tendency to meet the target value, even if it means that they have overestimated the value of the property. This drives prices artificially higher and leaves many homeowners with mortgages that may be worth more than the homes they were meant to finance. This problem becomes acute should the owner need to sell the home, only to discover that it isn't worth as much as he or she owes on it.

The worst-case scenario to result from this would be a burst in the current real estate "bubble" and a nationwide collapse in home values, leading to massive foreclosures. This probably will not happen, but there are several things prospective borrowers can do to avoid being caught in the appraisal trap:

  • *Become educated about the appraisal and lending process. The more informed you are, the less likely you are to be caught in a scam.
  • *Be aware that refinancing your home isn't a cure to all problems. It may seem appealing to use the equity in your home for such uses as debt consolidation but if the result of that is that you owe more on your home than it is worth, you probably haven't gained anything.
  • *Be active in the appraisal process. Talk to the appraiser, and ask to see the finished appraisal, along with the data used to create it. Appraisals are based in part on the sales of similar properties in your area. Check them out yourself and compare the home you saw with the stated appraisal value.
  • *Be bold. Ask your lender if they pressure their appraisers to provide inflated values. You might not get an honest answer, but pay attention to how they respond. You might be able to determine if they are lying.
  • Ultimately, if you take out a home equity loan or a mortgage for more than your home is worth, you are the one that suffers. That can be easily avoided if you simply pay more attention to the process and educate yourself about the possible pitfalls. The last thing you want to lose is your home.

    ©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including http://www.End-Your-Debt.com/ and http://www.HomeEquityHelp.net/


    MORE RESOURCES:
    This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news


    Forbes

    The Problem With Real Estate Agents
    Forbes
    What makes the profession such a big target for headlines, reality TV and venture capitalists? Why do so many people want to become real estate agents now? Commission — everybody wants a piece of the pie. Let's start with how the real estate industry ...



    Forbes

    Real Estate's Five Dirty Words
    Forbes
    Real estate professionals need to really ask ourselves what luxury means. Is a one-bedroom apartment with a clean aesthetic and laundry in the basement truly a luxury property? Is it appropriate to lump in standard homes in the same breath as a ...



    Seeking Alpha

    Real Estate Values And REITs | Seeking Alpha
    Seeking Alpha
    Several of the comment threads in my articles have focused on property values. Going up, going down, how do property values impact a REITs profitability? At the.

    and more »


    Idaho Press-Tribune

    County to pick real estate agent in sale of Agriplex property | Idaho ...
    Idaho Press-Tribune
    CALDWELL — Canyon County commissioners received proposals from all three real estate firms that were asked to submit letters of interest to handle the sale of the 80-acre parcel known.

    and more »


    IGR: My Real Estate Money Machine
    Seeking Alpha
    IGR is a closed-end global real estate fund that provides a monthly dividend far in excess of the market average, useful in today's low rate environment. The fund's current portfolio is largely US-centric, somewhat surprising for a global fund ...

    and more »


    Bisnow

    Blackstone, USAA Have Concerns About Industrial Real Estate
    Bisnow
    Dalfen America Corp. President Sean Dalfen, Blackstone Managing Director David Levine and USAA Executive Managing Director David Buck speak at Bisnow's National Industrial event in Manhattan, Feb. 20, 2018. Industrial real estate has a lot going for it ...



    Valuation Dashboard: Financials And Real Estate - Update
    Seeking Alpha
    This article series provides a monthly dashboard of industries in each sector of the GICS classification. It compares valuation and quality factors relative to their historical averages. Executive summary. Mortgage REITs are the best-looking financial ...



    CNBC

    Real estate owner Kimco to benefit from Albertsons' acquisition of Rite Aid
    CNBC
    Real estate investment trust Kimco Realty is poised to be one beneficiary of Albertsons acquiring Rite Aid, creating another U.S. grocery-pharmaceutical behemoth fending off Amazon and Walmart. Kimco has a roughly 9.7 percent stake in the Boise, Idaho ...

    and more »


    GlobeNewswire (press release)

    True North Commercial Real Estate Investment Trust Announces An Increase To The Previously Announced Equity ...
    GlobeNewswire (press release)
    TORONTO, Feb. 21, 2018 (GLOBE NEWSWIRE) -- True North Commercial Real Estate Investment Trust (TSX:TNT.UN) (the "REIT") is pleased to announce that, due to strong demand, it has entered into an agreement with a syndicate of underwriters led by CIBC ...
    Agellan Commercial Real Estate Investment Trust Announces February 2018 Monthly Distribution and Fourth Quarter ...Business Wire (press release)

    all 16 news articles »


    W*USA 9

    How to choose the perfect real estate team
    W*USA 9
    Real estate agents often specialize in different areas, so find out who will best meet your needs. Cheapest isn't best. In terms of real estate, a discounted fee will often come with inferior service. You want your real estate professionals to do their ...


    Google News

    home | site map
    © 2006 TIGER MEDIA