We’ve all read, heard, and now experienced CU for ourselves, some good and some bad but enough about CU.
Nearly every appraiser in the country has undoubtedly been busy, given the low rates the marketplace experienced recently. As we all know low rates equal more refis and more refis more appraisals. Hopefully you’ve been able to manage your increase in volume keeping your turn times and quality at an acceptable rating to your client. I personally have seen the quality of some reports to the point where I will not accept them. This has nothing to do with bad comps or lack of analysis. Rather this is directly related to appraisers rushing through a report and not paying attention to details. Misspelling the borrower’s name, missing various checkboxes, botching comp characteristics and adjustments for them are among the top issues. All of these minor mistakes delay the mortgage process for the borrower. Even in times of increased volume, quality should stay consistent. Your clients will notice and appreciate this. Lenders I have spoken to have stated that revision requests drastically increase in times of increased volume. If you keep your revisions down to a minimum, then you will really stand out from your competition. You will likely also see continued business from that client possibly even an increase in orders when overall volume slows.
I’ve heard of many appraisers not accepting work from certain clients when times are busy. I can’t say that I agree with this business practice. If you have a bad client that pays low fees and requires numerous revisions then you must ask yourself why are they your client in the first place? On the other hand if you have a good client and pays a good fee and you turn their work away because you are getting an extra fee from another client that never used you before that is not a good business decision. Chances are that new client that pays a bit more will not use you once volume levels out. When you go back to your client that has always used you but pays a little less they may likely have found someone to replace you.
Rates are increasing so we should see a bit of a slowdown. The good news is that the spring market is upon us and the purchase business should start to increase. Purchases used to be relatively easy appraisals, but recently with low inventory levels it seems that contract prices are at the upper range of value quite often. At times it’s hard to support the contract price and in some situations they cannot be supported. No one wants to kill a deal but as long as you support and explain your appraisal to the lender and prove why it’s not worth the contract price they will appreciate this. I personally provide a superior comp in the grid in these situations and apply a negative adjustment to prove why it’s not worth the contract price.
It’s finally warming up here in the Midwest so I hope we all stay busy and enjoy the above freezing temps.