As record low mortgage rates prompt a wave in both home buying and refinancing, appraisers may be having a tough time keeping up: Lenders are reporting turnaround times for appraisals are increasing and, as a result, lengthening the underwriting process.
Lenders informally surveyed by HousingWire are reporting that they’re being quoted two to three weeks for an appraisal. One lender reported an appraisal that was to take 10 days came back nearly 27 days later. Some appraisers in hot markets like Colorado are saying they can’t make it out to a property in four weeks or more, HousingWire reports.
“What’s happening is because it’s difficult to become an appraiser,” Phil Treadwell, vice president of development and regional manager for Mason-McDuffie Mortgage, told HousingWire. “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.”
Brian Covey, vice president of regional production for LoanDepot, also says the industry is seeing a limited number of underwriters to keep up with the demand. As lockdown restrictions eased in May, mortgage volume began to surge. Low mortgage rates are creating a need for more underwriters and appraisers, lenders say.
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 to 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 speed up the 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)
