The week after Comptroller of the Currency closed First NBC Bank of New Orleans another billion dollar plus bank was closed, Guaranty Bank of Milwaukee, Wisconsin.
Bad loans seemed to be the primary cause but Guaranty Bank also had an insane number of branches located in grocery stores. Out of 119 branches, 107 were located in grocery or similar retail outlets.
Ohio recently enacted a ban on the use of plywood when boarding up vacant properties. Ohio is also the first state to enact a ban of this type. Property preservation has been a significant issue for many states that have areas of abandoned properties. To see a neighborhood of boarded-up houses creates a neighborhood blight issue that is hard to overcome.
Ellie Mae recently provided information on the loans flowing through their platform. They are a software provider that was founded in 1997 that many community banks utilize. Right now, they are handling almost a quarter of the loans made in the United States. That’s a decent % and the data they provide is a good reflection of the actual mortgage market.
The March data looks like this: 63% of their mortgages were purchase, and 37% were refi, a significant change from the past nine months. Refi’s had been running in the mid to high 40’s. The time to close (all days) was an across the board 43 days.
I’ve been in the industry for 37 years and, until recently, have not ever had an issue with finding appraisers for assignments. But, boy has that changed, especially in rural areas!
Contract Amendments; When? (Illinois Appraiser Newsletter – January 2017) Was an excellent article that describes the appraiser record-keeping requirement and the issues that many appraisers face by having access to all versions of a report that they have produced. The appraiser's work file is required to be complete and contain all copies of revised reports. That can be a little hard depending on your software and your tracking system. Many appraisers already have their method down for complete record keeping, but just in case you miss one, let me point out that the SAMCO system keeps all versions of your reports.
The updated Fannie Mae Selling Guide released in January clearly states (see below) that a Supervisory appraiser is not required to inspect the subject property or comparable sales.
B4-1.1-03, Appraiser Selection Criteria (01/31/2017)
Supervisory Appraiser
The Federal Reserve Bank of Chicago reported in their latest AgLetter that Midwest land values suffered a third consecutive annual decrease. Granted, the 2016 decrease was only 1% overall, much smaller than the previous two years. 2015 and 2014 both has 3% decreases for both years.
Record harvests of corn and soybeans were produced in 2016 for the five states that make up the Chicago district. According to USDA corn yields increased 11% and soybeans 8.7% from 2015 levels. National corn production for 2016 established a new record of 15.1 billion bushels, up 11% from 2015. U.S. soybean output for 2016 set a record of 4.3 billion bushels, up 9.7 % from the previous year.
North Carolina has passed legislation that appraisal management companies must pay customary and reasonable fees to appraisers. Active enforcement is in place now. North Carolina is joining the growing list of states that are being proactive on the Dodd Frank requirement of Customary and Reasonable. Kentucky, Texas, and North Carolina are just a few.
Below is the email and guidance document issued from the North Carolina Board.
To all appraisers, appraisal management companies, and interested persons:
As reported in RISMedia and other outlets, a major mortgage lender, Prospect Mortgage along with two real estate brokerages have been ordered by the CFPB, Consumer Financial Protection Bureau to pay more than $3.5 million in penalties for operating an illegal kickback program for mortgage business referrals.The Real Estate Settlement Procedures Act (RESPA) prohibits real estate agents and brokerages from recommending settlement services, such as title insurance, appraisals, inspections, and loan origination, to consumers in exchange for payment from those service providers.
Appraisal/Evaluation management is when an individual or group employs Licensed, Certified and General appraisers to fulfill real estate appraisal assignments, and qualified real estate professionals to fulfill evaluation assignments, on behalf of the mortgage lender. It involves recruiting, qualifying, verifying licensure and other requirements, negotiating fee and service level expectations; administrative duties like order entry and assignment, tracking and status reports, pre-delivery quality control (USPAP and Appraisal Standards), and report delivery (generally electronic). In addition, it involves ongoing quality control (a new major focus of federal regulators), accounts payable and receivable, market value dispute resolution, and record retention.