T
ime to read [10 minutes]

    NYC Managing Agents Are Gouging Applicants With High Info Fees Needed To Buy

    Pulte Pauses Freddie and Fannie’s Privatization After Inferring Certainty

    The residential appraisal world of mortgages is under siege, impacting many participants in the home buying process. A seasoned real estate appraiser once told me that everyone involved in a home sale knows the "number" before the appraiser arrives, except for the appraisers themselves. They are the only neutral party, yet constantly under pressure.

    Managing agents in NYC are gouging appraisers with high information fees. Typical fees used to be less than $100 and were built into the appraisal fee from the bank. However, they have doubled to $200, then $400, and now some managing agents quote $600 fees. This is taking advantage of the fog created by inflationary pressures.

    Appraisers are caught in the middle, as banks don't want to absorb the additional cost. If an appraiser quotes a fee of $1,000 for an appraisal, but the managing agent ups their fee from $100 to $600, the appraiser is expected to eat the extra cost. This is unsustainable and unfair.

    Pulte Pauses Freddie and Fannie’s Privatization

    FHFA Chair Bill Pulte has decided to pause the privatization of GSEs after building up expectations that this action was a given. I contended that privatization would cause mortgage rates to tick higher due to the government's guarantee no longer being a sure thing.

    Pause On Fannie Mae And Freddie Mac Privatization

    FHFA Chair Bill Pulte has decided to pause the privatization of GSEs after building up expectations that this action was a given. I contended that privatization would cause mortgage rates to tick higher due to the government's guarantee no longer being a sure thing.

    Appraiser Regulator Chaos

    The Appraisal Subcommittee (ASC) is under pressure to change, and there is an effort in the Senate to cut funding to the Appraisal Foundation by half. This makes sense given its bloated budget and disconnect with the appraisal industry.

    A Senate Bill, the "Appraisal Industry Improvement Act," was introduced last May that would essentially cut TAF revenue by half. This bill would remove TAF's crippling requirement for hiring trainees and instead rely on the mentoring system. In our appraisal practice, we must wait 2-3 years before a trainee becomes cost-effective to hire.

    Final Thoughts

    My appraisal industry continues to be under siege but there is some hope on the horizon as seen in recent proposed legislation. The idea that I can't hire appraiser trainees and use them for up to three years is ludicrous.