Mortgage Blog

Quality advice, quality service and the best mortgage rates


October 29, 2018 | Posted by: Marc Crossman

If a picture is worth a thousand words, what kind of story are the pictures in your client’s property appraisal telling the lender?
In the world of broker-driven lending, lenders seldom if ever actually set foot on the property before making a loan decision.  Instead, they rely on their trusted group of appraisers.  All the lender sees is the appraiser’s commentary and some pictures of the property.  These appraisers are asked simply for their honest opinion about the value of a property – neither too optimistic to satisfy a borrower nor too pessimistic to try to protect the lender.  On the other hand, the lender is looking at the pictures in the appraisal to infer everything they can about the borrower and the property.
Tip #1 – This may seem self-evident, but have the borrower clean up the house before the appraiser arrives.  Prepare the house as is if was going to be sold.
Tip #2 - Advise the borrower that the appraiser will need to see every room in the house, no exceptions.   If the baby is sleeping, let the appraiser peek quietly in the room.  Refusal to allow an appraiser to see any room will be noted in the appraisal and raise a significant red flag for the lender.  There are times when it is not appropriate for the appraiser to take pictures of certain things and appraisers and lenders understand this, but refusal to grant access could be terminal to the success of the application.
Tip #3 - Don’t bother telling the appraiser what value the borrower needs for the property.  Most appraisers approved to work with alternative lenders will simply ignore this.
Tip #4 - Prepare the borrower.  Let them know that the appraisal may come in lower than they believe their house is worth.  The neighbour’s house may have sold for a certain price but that doesn’t mean all the houses on the street are worth that amount.
Tip #5 - Let the borrower know that the appraiser will likely want payment up front when they show up at the house.  When booking the appraisal appointment, make sure the method of payment is discussed as not all appraisers take credit cards.
A few steps taken to prepare the house and prepare the borrower will help strengthen your client’s application and provide the best chance of a satisfactory funding.  The experienced staff at Paradigm Mortgage are happy to help Brokers work through the appraisal process.


Source: Paradigm Mortgage Corp

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