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Thursday, December 16 2010 - By Becky Harris
Both home sellers and buyers are being affected by drawn out appraisal processes.
Finding a buyer is no longer the main challenge for people looking to sell their homes and relocate in the current market, according to Reuters.
Many lenders are now requiring multiple appraisals on a property before they will allow a sale to go through, causing both home sellers and buyers to shell out hundreds - and sometimes thousands - of dollars for various appraisals, the news source reports. Lenders are anxious to verify that the market value of a house is worth as much as the loan they are providing, and will stretch out the process until they are satisfied with the rates they receive from appraisers. Walt Molony, of the National Association of Realtors,told Reuters the appraisal process is resulting in contract delays and cancellations. In October, one in 10 NAR agents said they had a contract canceled because of a low appraisal, and 16 percent said a low appraisal led to a lower sale price for a home they were representing. Furthering the problem, the rising rates of home foreclosures and short sales are making it difficult for some appraisers to determine the actual market value of houses in highly affected neighborhoods. A recent report from the Federal Housing Finance Agency found that home prices have dropped 3.2 percent over the past year, with the biggest losses found in the country's Mountain division. More News |
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