Some Appraisers Have Trouble Keeping Up with Demand
CHICAGO – As record low mortgage rates prompt a wave in home buying and refinancing, some appraisers have a tough time keeping up. Lenders report that turnaround times for appraisals are increasing and, as a result, lengthening the underwriting process.
Lenders informally surveyed by HousingWire say they’re being quoted two to three weeks for an appraisal. One lender reported an appraisal took 27 days after being told it would take 10. It’s even longer in some hot markets. In Colorado, appraiser say they can’t make it out to a property in four weeks or more.
“What’s happening is because it’s difficult to become an appraiser,” says Phil Treadwell, vice president of development and regional manager for Mason-McDuffie Mortgage. “And because you have to go through third parties whenever you have a spike in production, those agencies and appraisers get backed up. There’s not a whole lot that can be done – at the end of the day we have a finite number of appraisers.”
According to NAR’s 2020 Member Profile, the typical appraiser specialist already had a 4% increase in business in 2019 compared with 2018.
Brian Covey, vice president of regional production for LoanDepot, says the industry has a limited number of underwriters to keep up with demand. As lockdown restrictions eased in May, mortgage volume began to surge. Low mortgage rates also created a need for more underwriters and appraisers.
One silver lining: The industry says appraisal waivers are increasing in some markets.
“Property inspection waivers through automated underwriting systems and consumer-friendly online document exchanges have helped speed up the process and keep employees and families safe along the way,” HousingWire’s Alex Roha reports.
But companies that do not have technology to help accelerate the appraisal process say transparency will be necessary.
“What I’ve been encouraging people to do is just be really honest with the customers,” Lori Noble, an appraiser, told HousingWire. “My clients who are honest like that are definitely being successful, and it’s not causing any discomfort, just success. People in the industry forget we are selling a home – this is more than a bottom line and, if you are realistic, people will understand that.”
Source: “Surging Mortgage Volume Puts Pressure on Appraisal Turn Times,” HousingWire (Aug. 4, 2020)
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