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Home Appraisals: A Look Under the Hood W By Jayson Stebbins Mortgage Professional Jayson Stebbins is a 20-year veteran of the Mortgage Banking industry and an Accredited Mortgage Professional through the Mortgage Bankers Association. He grew up in Morgan Hill and currently lives in Gilroy. He is the local Branch Manager of Guild Mortgage, a 53-year -old Mortgage Banking firm. His office is in Morgan Hill and serves all of Santa Clara, San Benito, and Monterey counties. You can reach Jayson and his Team at 408-782-8800 or at e know that we have to qualify to buy a home. Our income, credit and bank statements are scrutinized to confirm we have the willingness and ability to repay the home loan. Sometimes forgotten is the fact that the house has to qualify as well. The property we want to buy has to meet value and quality standards to be acceptable collateral for the home loan. Appraisals are a unique mix of facts and feel. A home appraiser has to take the condition and state of the property and compare that to homes that have sold within the last 6 months, then come up with a value that is supported by the market. Using market knowledge, common sense, and a little bit of art, the final valua- tion determines if a lender will lend on the house, and how much they will lend. Usually lenders want to see sales in the past 6 months to support the value of the house. This can be frustrating to buyers or people trying to refinance if they have a foreclosed home in their neighborhood, or an REO (bank-owned) type property that is sold for a low value. This may affect the value the appraiser can give. Other things that impact the value of the house are things like marketability. Is the house one that will sell quickly if put back on the market? Have changes been made that make it very specific to only a small section of the buying public? Appraisers also look at additions (with permits or without) and the condition of the home. We are facing a unique challenge at this moment as values move up quickly. Sales prices are moving up faster than the comparable sales close, making it hard get the value needed to support the purchase price. This is hopefully a short-term problem, as increased inventory and a flattening of price acceleration will help to even things out. Increased regulations have also made it more difficult, as Lenders no longer can communicate directly with appraisers and Realtors are encouraged to minimize their conversations to information requested. Problem resolution, questions and concerns must go through the third party Appraisal Management Company now, and that can slow down the process. Qualifying the house is just as important as qualifying the borrower. And the home Appraiser gets the challenging job of making the borrower and lender happy. Jayson Stebbins is a licensed mortgage agent in CA for Guild Mortgage Company NMLS#38463; Licensed by CA Disclosure:Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act. NMLS Company Unique ID 3274; Branch Unique ID 38480. The postings on this editorial don’t necessarily represent the positions, strategies or opinions of Guild Mortgage Company or its affiliates. This information is not guaranteed to be accurate and shall not be construed as a guarantee of loan approval. All loans are subject to underwriter approval, and are subject to change without notice. Equal Housing Lender. 18 GILROY • MORGAN HILL • SAN MARTIN MARCH/APRIL 2016