Need a high value comp check?

Recently, I had one of our clients request a “top value comp check ” to help him determine if he could make the loan.  I understand that the loan agent will lose the prospect if not enough equity, so both the agent and the borrower want “maximum value possible”.  A common request and we are happy to provide comparable sales information, but they aren’t always what the loan agent wants. 

Regarding “comp checks”, USPAP and logic set boundaries that the professional appraiser must stay within.  My hope is that understanding these boundaries will help mortgage professionals better work with their appraiser. 

• The appraiser cannot make a value judgment without going through the appraisal process.

• USPAP prohibits the appraiser from making a value judgment before completing the appraisal process.  Appraisers who tell you if your estimated value will “work or not” are unethical and are at risk of losing their license. 

• Logic prohibits anyone from making an accurate value judgment before obtaining all the facts. I.E. market conditions, location, condition, size, detriments, and the list goes on and on.  How would you feel about your doctor if he told you, you needed an operation based on a phone conversation?  Looking at a list of comparable sales and stating a value estimate sets the appraiser and the lender up for problems. 

•  The appraiser cannot take an assignment based on a “predetermined value”.

• AO-19 from USPAP states “If an appraiser is asked whether a specific property has a value (a point, a range, or a relationship to some benchmark), that request is for an opinion of value (an appraisal). Appraisers, obligated to comply with USPAP, must develop a real property appraisal in accordance with STANDARD 1. Communicating that value opinion must be accomplished in accordance with STANDARD 2.”

We send comps as an accommodation and are happy to do it as a service to our clients. However, we cannot make value judgments without doing an appraisal. We generally recommend doing an appraisal if there are comps that bracket the estimated value. We also suggest the borrower check the comps and decide if an appraisal is warranted.  The majority of appraisal management companies will not do this for you nor will an appraisers directory.

Leeper Appraisal Services work with many loan agents and brokers on a daily basis.  We offer free “comp checks” to give our clients more information to help them in their loan process. 

…But please, do not ask us for a “max value comps check “

Chas Leeper ,real estate broker for over 32 years; certified and designated home appraiser for over 23 years ; an author, surfer and grandparent.  He is currently the President of Leeper Appraisal Services.   More about Chas Leeper, go to www.leeperappraisal.com/principalappraiser.htm or call 949-574-5534. 

Thank you for visiting my site! If you want to find out more about Buying and Selling Homes in Picayune and the Pearl River County, MS, area, go to

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You’ve found the house, your offer has been agreed on, and financing is in place. But before you get started packing, be sure you retain a professional home inspector to ensure your home doesn’t have any major defects that could cost you later.

A residence inspection generally includes an examination of heating and central air conditioning systems, inside plumbing, electrical systems, the roofing, crawl space, observable insulation, walls, ceilings, floors, windows, foundations, and basements. Inspections may also include things like appliances and outside plumbing.  Some areas of the country include inspections for issues that are more common in that regions.  For example, Fort Worth real estate inspections typically include a scan for mold.

Once the inspector examines the home, he or she will draft a statement with findings. If there are any big issues, you’ll need to negotiate with the seller to either decrease the sale amount of the property, or figure out how the concern will be fixed.

When you present an offer it’s intelligent to have a contingency clause based on the home inspection. In other words, if the inspector finds $10,000 worth of concerns and the seller doesn’t want to provide the fix, you can revoke your offer.

In fact, two in 5 resale properties will have at least one significant problem that could cost you from a few hundred dollars to up to $15,000 to correct, according to the 2009 HouseMaster Resale Home Deficiencies Study.

Investing a few hundred dollars for a house inspection is well worth the peace of mind.

If you really don’t know how or where to locate a home inspector, be cautious about asking your real estate agent. The American Society of Home Inspectors is a effective place to begin. All certified members have completed not less than 250 inspections and have passed 2 written proficiency exams. They must also conform to standards of practice, continuing education requirements, and code of ethics.

ASHI recommends you meet with a number of inspectors before choosing one. Several of the questions you need to ask include:

# What does the inspection cover? Ensure the inspection and the inspection survey fulfill all applicable requirements and comply with the ASHI Standards of Practice.

# How long have you been in the job and how many houses have you inspected? Again, ASHI Members are expected to have accomplished no less than 250 paid professional home inspections and passed 2 written exams that test the inspector’s expertise.

# Are you specifically experienced in residential inspection? The answer ought to be yes. If someone says they have specialized instruction in something like construction or engineering but not in housing inspection, you may want to proceed to the next choice.

# Does the inspector’s business offer to complete repairs or improvements dependant upon the inspection? The answer should constantly be no. This is against the ASHI Code of Ethics since it may well lead to a conflict of interest.

# How long will the inspection take? The normal for a sole inspector is two to 3 hours for a typical single-family household; anything much less might not be sufficient time to perform a in depth inspection. Some inspection firms send a staff of inspectors and the time frame could be faster.

# How much will it cost? Costs differ quite a bit based on the location, dimensions of the home, scope of services and other factors. A typical range may be $300-500, but look at the value of the home inspection in terms of the investment being made.

# Does the inspector create a written statement? Ask to look at samples and determine whether you fully grasp the report.

# Does the inspector encourage the client to go to the inspection? This is a beneficial educational opportunity for you to discover how things work around what might be your home, and the inspector may talk about things that will not quite deserve a mention in the statement but which you should keep an eye on. An inspector’s refusal to make it possible for you to be present ought to raise a red flag.

Lastly, once you have located an inspector you like, ask him/her for references, then follow up and speak to those customers. 2 key questions – whether they found any main problems after the close of escrow that the inspector didn’t detect, and whether they would use the inspector repeatedly.

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How to Choose a Home Inspector when you’re buying a Home

By Tim Spargo, Certified Residential and Commercial Real Estate Inspector

I will attempt to break down this question as we are seeing some really strange trends in our current economy and housing Market.

As I’ve been a Home Inspector for many years I’m often asked the same question over and over again. Clients, friends and many other “folks” want to know what separates one Home Inspector from the next.  I will begin with a variation of a checklist that can be found at my website linked in this article.

When choosing someone to inspect your Real Estate Purchase it’s important to remember a few things:

I recommend Making a “Checklist” and calling a few Home Inspectors in your area – try not to book the first one you call! You’ll notice in a series of recommendations I have YOU ASK… I didn’t mention PRICE until the end.

By the way, if our “candidate” is in the middle of an inspection and needs to call back, that’s fine!  Don’t get into a hurry!

• Experience – Ask the Home Inspector “What type of experience do you have. How long have you been in business? What type of Industry related experience do you have besides being an inspector?” 
  •  
    • We’re trying to get an idea as to how long our “candidate” has been around and what his or her background may be. I’m sorry to say but we don’t want newbies inspecting our expensive purchases. I also don’t want someone who… no offense here, was working at a Retail Store this or last year and is now responsible for helping me decide on the most expensive purchase that most of us will ever make.
• Are you a member of a Professional Organization and are you “Certified”?    The answer here should be YES.
  •  This topic has some debate as to which certifying body is “better”, I could care less. It’s like saying your Real Estate Agent is better because they are from one large firm and not the other. The idea here is that an inspector has made a committment to be a professional. If they are not a member of Nachi, ASHI or NAHI to name a few… I’d want to know why!
•  Do you carry Insurance? The only answer here is YES.
  • If you are a buyer or a Real Estate agent, recognize the fact that most professional and full time inspectors carry insurance. If you as an Agent are “shopping” for your client, be careful if your inspector doesn’t have insurance, you may be liable as the “referring party”.
• Are you INDEPENDENT?
  • Sorry if this sounds bad, but most Good inspectors I know are independent inspectors… Distant from any binding agreements with “outside” parties limiting their scope and ability to “talk freely” about their thoughts and findings.
• Are you LICENSED?
  • Many states (no Licenses are required in California by the way) have License Requirements for Home Inspectors that require State Licenses. Inquire with your State’s Website before you call an inspector. As a Home Inspector in Lancaster CA we have very few requirements here, but this will vary from state to state and area to area.
• Who will perform my Inspection?
  • Here is another one that I get some “flack” for. In a perfect world, the person answering the phone will be the person inspecting your Real Estate purchase. A couple of reasons for this include: A Real Estate Inspection can be a liability if performed poorly and should be done so by the person who would be responsible! Let’s think about this for a minute… If I have someone that works for me… would they be more likely to mention an “obscure or minor” item knowing that “it’s no big deal and shoot, I’m not responsible anyway” or as ME the owner.. knowing that liability AND reputation are on the line? Easy one I think!
• What type of Inspection Report will I receive?
  • While the best report will come from the best inspector, I’ve decided that the Checklist paper type are too antiquated and are nearly obsolete. They are easier for me, the Home Inspector to use, but are easily less informative than the computerized reports that I now use. It’s the 21st century, request a computerized report with pictures for goodness sake! The inspector generally has the ability to store relevant information and common situations that are relevant to your local area and the paper type are generally not. I could be wrong on a small scale, but not by much!
• Can I attend the Inspection?
  • The answer here is a very important one….your inspector should actually “encourage” you to be there. If they didn’t I consider it a red flag, unless you indicated prior to asking this question that you couldn’t be there! The reason I say it’s a red flag is because of this, a shy or reserved type of person may be a great inspector, but is likely to find it difficult to be comfortable explaining items and “being under the gun”. Does that make sense? It should! So this is actually a good time to tell if your inspector is a “Chatty Kathy” or “Mr. No personality”. There is a really bad inspector in my area that people really like and he does well, simply because he is so friendly and well spoken. His or her clients should be reading these questions before calling him though
• How long will it take to get my Inspection Report?
  • The answer should be either : Soon or Very soon! Meaning this, inspectors that takes several days, especially during the workweek to deliver reports creates a lot of problems. This is because: Most inspectors I know have very good memories, but good enough to have 4-6 reports backed up and waiting to be written? No, of course not. Myself, I have most of my report done when I’m leaving the inspection, thanks to the advent of a portable tablet style laptop ( a necessity in my book) I could probably go “out to the truck” and send it out. I don’t though. I insert my photos and proof read my work and send it out later that day or by the next morning or so. We all have ways that work for us, I just don’t see how many inspectors can write accurate reports several days after leaving the job site.
• Can I call you if I have any questions after the inspection or after I receive my report?
  • Most inspectors are going to say YES! Try to remember in this “interview” with your potential home inspector whether you got a feel that this person is a sociable one or just in a hurry to get off the phone.
  • As mentioned, if he or she is in the field and offers to call back, don’t hold it against them. See if they do and think of it as an opportunity to see if they do as they say! After all it’s easier to answer a phone that to make time to call people back.

The last question should be “How Much”. Not to say that this isn’t important to you, it just should carry a smaller “weight” if you will. I think that people put way too much emphasis on the cost of a Home Inspection rather than looking at some facets that I have made available for you here!

I am currently entering over a decade of Home Inspections in Antelope Valley , I will have many more stories to share and will hopefully get to spread some “wisdom” to my readers and save them aggrevation and money!

I will be writing another article on a topic ” I’m buying a Home As-Is, should I get it Inspected?” Yes you should, I’ll write more about it soon.

I hope that you find this tips helpful and if I can be of further service visit my website Home Inspection in Palmdale CA.

Thanks again for reading and good luck!

Tim Spargo

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Have you ever heard it said  , “A good appraiser is hard to find”. It really depends on what definition you use. I have been around long enough to know there are multiple definitions for a “good appraiser”.

The real estate appraiser’s definition of “a good appraiser”: The good appraiser has been well trained through experience, mentoring and education . He understands if the value is off, someone relying on his report might get burned. The appraiser has  reliable data sources and knows his area of service well. He is expert of the ebb and flow of buyers and sellers in the  subject properties marketing area , both from his  extensive data sources and from his experience in the neighborhood. When including sales comparables report, he strives to use the most recent comps which are most comparable to the home being appraised.  Property and locational differences are adjusted based on what buyers in the market indicate by their actions. The good appraiser also considers comparable listings and/or pendings as (after market based adjustments) they  will tend to set the  high end of value. The certified appraiser reconciles  his inspection, data research, reasonings and analysis into a  final value that is not  affected by biased people connected with the transaction. The result will be an unbiased home appraisal.

From over 24 years of appraising, the following is my understanding that  the definition of a good appraiser is, from the view point of view of:

Divorcing spouse A: A good appraiser is one who brings the value in LOW because I want to buy my EX out of the house.

Divorcing spouse B: A good appraiser is one who brings the value in HIGH because I want my EX to buy me out of the house.

A few Commissioned loan agents: A good appraiser is one who will, look at MLS for comps and tell me what the value will be before doing the appraisal; use whatever comparable sales will indicate a high value (even if they are not the most comparable); withhold information about the property or location ( which might upset the underwriting process ); will change the report when the truth about the property  hinders the underwriter/lenders guidelines or requirements; will bring the value in for what ever will make the loan work. (Disclaimer: the majority of commissioned loan agents I work with are very professional and do not use the above tactics)

All Lenders (the one with the money): A good appraiser will be unbiased in his appraisal and communicate true market value.

It is kind of funny that the definition of “a good appraiser” can be so varied. In the face of being labeled “a bad appraiser” by those who use another definition, the good appraiser will always stick to his definition, no matter the cost.

C.W. Leeper ,real estate broker for over 35 years; certified and designated home appraiser for over 20 years ; an author, outdoors man and grandparent.  He is currently the CEO of Southern California Real Estate and Appraisal Inc.  Newport Beach appraisal of bayfront and waterfront homes is his specialty. Click below for more info. about Mr. Leeper www.leeperappraisal.com/principalappraiser.htm or call 949-574-5534. 

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With the enactment of the HVCC (Home Valuation Code of Conduct), the appraisal industry has been turned upside down.  Appraisers who have built a client base of mortgage brokers over many years are now told that those clients cannot order appraisal from them anymore.  The plan was enacted in part to “protect” the appraisers from undue pressure from mortgage brokers.  I think it obvious this is not the kind of “protection” professional appraisers want or need.  Appraisers and licensed loan brokers have always been under strict ethics and legal restrictions so the appraisal remains unbiased.  The HVCC is a slap in the face (and the pocketbook) of the professional unbiased appraiser who has spent years developing his client base by hard work and ethical behavior.  The ethical appraiser takes it on the chin for the few bad appraisers in the appraisal industry.  Seems like stepped up enforcement of our current laws would have been the first step, instead of gutting a business model that the majority of appraisers use.

Appraisal management companies have flourished in the wake of the this new upside down appraisal world.

Representatives from the Federal Housing Finance Agency (FHFA), Fannie Mae, Freddie Mac and others, tell  appraisers that there is no going back to business as it was prior to HVCC , no matter if the Code is allowed to sunset in November of this year or terminated before then.  However, passage by the House late last year of the Financial and Mortgage Industry Reform Bill (HR 4173) could change things.  If signed into law, the bill would establish a Consumer Financial Protection Agency and require lenders to compensate appraisers their full fees, rather than splitting them with appraisal management companies. There will be rules to uphold appraisal independence. The bill authorizes the director of the new agency 60 days from the date of enactment of this legislation to establish such appraisal rules and calls for the HVCC to cease at the time the new  requirements go into effect. The bill was referred to the Senate Committee on Banking, Housing and Urban Affairs earlier this week.

Regarding appraisal management, the bill includes the following:
(1) Shall not prohibit lenders, the Federal National Mortgage Association, or the Federal Home Loan Mortgage Corporation from accepting any appraisal report completed by an appraiser selected, retained, or compensated in any manner by a mortgage loan originator—(A) licensed or registered in accordance with section 1501 et seq. of the SAFE Mortgage Licensing Act of 2008; and

(B) Subject to State or Federal laws that make it unlawful for a home loan originator to make any payment, threat, or promise, directly or indirectly, to any appraiser of a property, for the purposes of influencing the independent judgment of the appraiser with respect to the value of the property, except that nothing in this section shall prohibit a person with an interest in a real estate transaction from asking an appraiser to—

(i) Consider additional, appropriate property information;

(ii) Provide further detail, substantiation, or explanation for the appraiser’s value conclusion; or

(iii) Correct errors in the appraisal report; and

(2) Shall include a requirement that lenders and their agents compensate appraisers at a rate that is customary and reasonable for appraisal services performed in the market area of the property being appraised.

(c) SUNSET.—As of the date the appraisal independence requirements are promulgated pursuant to subsection (a), the Home Valuation Code of Conduct announced by the Federal Housing Finance Agency on December 23, 2008, shall have no force or effect.

I am hoping that the new bill will allow appraisal services industry to get turned right side up.

Mr. Leeper ,real estate broker for over 30 years; Designated member of the Appraisal Institute; an author, outdoors man and grandparent.  He is currently the CEO of Leeper Appraisal Services.  More information about Mr. Leepercan be found at : www.leeperappraisal.com/principalappraiser.htm or call 949-574-5534. 

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When you are buying a home, you will probably need a mortgage to finalize the purchase of the house you have chosen. While choosing a home is an important decision, choosing a mortgage for the home is equally as important, and requires as much, if not more thought, than choosing the house itself.

When you go to a lender or real estate broker, you will likely be faced with two options for your mortgage: a fixed rate mortgage or an adjustable rate mortgage, commonly known as an ARM mortgage.

A fixed rate mortgage is a term mortgage for ‘x’ number of years at a fixed interest rate that is chosen and based on the economy and interest rate of the time you secure the loan. For the remainder of the life of the loan, your payments and interest rate will remain the same.

An adjustable rate mortgage is a term mortgage for ‘x’ number of years with interest rate reviews every one to three years. At the interest rate review, the interest rate applied to the mortgage amount will change by an undetermined rate.

While it is impossible to tell where the mortgage rates will be in ‘x’ number of years, there are a few factors to look at when choosing a mortgage. The ARM mortgage will immediately look like a ‘better deal’ because it will have a significantly lower interest rate than the fixed rate mortgage. However, if interest rates are already low, the ARM mortgage may end up costing you more in the long run. 

A little quick research or some simple questions to your lender about past interest rates will answer the question quite quickly. Choose wisely when you pick your mortgage type -it will have as much impact on you as the house you choose does.

For more helpful information on real estate and mortgages, please visit: http://www.BestRealEstateMoves.com. Looking for quality private label and resell rights content to sell for profit or publish up on your website? Help yourself to thousands of PLR ebooks, articles, reports, multimedia, graphics, turnkey sites and more — all bundled into easy-to-use, re-marketable modules — at The PLR Content Source: http://www.WOWContentClub.com

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Call Michelle Fradella today to get started – 601-569-0075

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The Egg Drop at the Picayune Municipal Airport, held by Picayune Main Street, was a big success today!  There were inflated jumpers, a rock climbing wall, many games and performances, and a huge drop of thousands of plastic eggs for kids of all ages to load up on.  The day was absolutely beautiful, and the kids seemed to have a lot of fun.  I know we did!

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