Thursday, April 01, 2010

April Fools Market

Real estate's new Magilla Gorilla is the escrow process, longer, and more onerous.  Appraisals are uncertain, rendered by out of area know nothings, loan approvals take an eternity to garner, lender demands: unceasing and often idiotic.  

Not only is the 30 day escrow process a thing of the past, but even a 45 day time frame is ambitious, perhaps ill advised.  Best plan on three months for an FHA deal.  Delays a plenty. Need synchronized closings?  Forget it, better to build in a seller rent-back.

The Appraisal Story

The appraiser surveyed the property, clipboard in hand, likely ignoring my neighborhood spiel.
"It's a new house," he blurted, questioningly.  
"No," I responded flatly--a bit astonished, "it was built in 1898.  Where are you from," I continued.
"La Canada," he volunteered, stealing a glance at his car, parked next to a hydrant.
"Have you ever been to this neighborhood before," I asked warily, "we're close to USC you know."
He hadn't, he didn't, and he tanked the value, comparing the property to others North of the freeway, apples and oranges.  


Supposedly we're safeguarding the consumer, thwarting cronyism with these new reforms, Good Faith Estimates, and the Home Valuation Code of Conduct (HVCC), which mandates an anonymous appraiser pool rather than area-experienced specialists.  Frankly, I think it's bunk. Window dressing, at the consumer's expense, to mask financial mismanagement and a creative shortfall.



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