Likelihood of a Fair Re-finance Appraisal from the Bank

Hello, fellow Brownstoners:  I am interested in re-financing my mortgage to get a lower rate.  I currently have an FHA loan, so I pay PMI.  I want to re-financing under a conventional loan to get that monkey off my back, but of course, I need the 20% equity required.  I purchased my Brownstone on a premier block Bed-Stuy in 2010 in the mid 700s, and I am confident now that with recent home price risings and the condition of my home, I could get close to a million on the market.  The problem is the price ranges in the surrounding area seem to vary alot, anyway between 600K and 1.3 mil.  I would hate to pay $600 for a bank appraisal, only to be compared to neighborhood comps not on par with my home.  Has anyone undergone a re-financing lately?  Any reaction to the fairness of the bank appraisal?  Thanks!

sobrooklyn

in Financial Services 12 years and 7 months ago

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refinancetoolbox | 12 years and 1 month ago

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how much PMI?

adamo | 12 years and 3 months ago

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Hey @sobrooklyn, how did it end upo for you?  I’m in almost exactly the same position, in BedStuy, and am wondering how this appraisal will turn out.  Any suggestions and hindsights would be welcome.

mortgagepro | 12 years and 7 months ago

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While lenders turn to Appraisal Management Companies (AMC) that randomly assign the appraiser, some AMC’s are better than others and have truly compiled a crew of qualified appraisals for a specified area.  Some AMC’s came to us years ago, requesting a list of the appraiser’s we regularly utilized.  So although we cannot designate a specific appraiser i certainly make sure the AMC’s chosen appraiser is local to the area.   In addition, I turned to local Brooklyn based appraisal companies I have known for decades and see which AMC’s they are signed up with and then used that information to obtain new wholesale conduits who use that AMC. As mentioned above, as an appraiser will be utilizing comparable sales in the area to ascertain your value, make sure you point out all the details to help determine that the recent sale was truly comparable; and the appraiser can then make appropriate adjustments where applicable. -Adam Roberts  South Shore Mortgage adamr@fast2fund.com

adam_dahill | 12 years and 7 months ago

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I make sure to use an appraisal management company that only uses Brooklyn Appraisers that are familiar with the area. With the major banks pulling out of the wholesale lending business (no longer working with brokers) my company has been banking most of our business as a direct lender which allows us to use a local appraisal management company. When going directly to a Wells Fargo, Chase, BofA they will use their own national appraisal management company who farms out the report to the lowest bidder. Unfortunately you get stuck with appraisers coming in from Long Island, Westchester, NJ etc.. It’s not such a big deal if you have a lot of equity in your place but it can get pretty hairy if you have a higher loan to value.  -Adam Dahill

ProHeights66 | 12 years and 7 months ago

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I recenty refinanced after a renovation and was very careful to point out every detail of the renovation to the appraiser — quality of materials, new plumbing lines and electrical, etc.  I think it made a big difference to walk through with him and point out the kind of details that matter to resale and comps.  I also bought in 2010 and my appraisal came in 50% above my purchase price — and a 100% return on the cost of my improvements. Make sure the place looks impeccable for the appraisal; they take a lot of pictures.  The key is to make your place look like the houses that sold at the high end in your neighborhood. It won’t be as high as a broker would list the house, though.

MaconStreetMan | 12 years and 7 months ago

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I am in the process of refinancing. I last refinanced in 2010\. I have received the new appraisal, and it is higher than it was in 2010, but not nearly as high as what I believe the true value of the house is (based on its location and condition). The appraiser even mentioned that the wide range of prices in the area made appraisals difficult and that a real estate broker would price the house very differently than he would. Lucky for me, I didn’t need my appraisal to be very high in order to refinance. Good luck.