Appraisal for re-finance

[taxman]

I'm a little nervous about our upcoming appraisal regarding our double-wide home. We purchased it new in 2006. It's a 28x64 model (I think it's a Commodore) and we added many upgrades to it when we ordered it: fireplace, jacuzzi tub, drywall/sheetrock partitions, kitchen island, recessed lighting, ceiling fan, energy efficient windows, plus it's an energy star home. It sits on a cement slab, but the foundation was built to look like a full cellar with windows (no skirting). We have taken VERY good care of the home and it looks very close to new. It sits on 5 acres of land in a country setting with a detached 2-stall garage (built in 2003). The local township that we live in has the full market value at $133,700 which is equal to the appraised value (we're at 100%). The appraisal must come in at what the town has the fmv at in order for the credit union to approve the re-finance. We're practically cutting our interest rate in half by doing this, so it makes sense. But, it's costing us $375 for the appraisal and I'm afraid of the history of depreciation with double wides. Has anyone else tried to do a re-finance with similar circumstances? Are double wides that are well maintained on permanent foundations holding their value or do they still depreciate? I would love for the appraisal to come in slightly higher so we can borrow additional funds for a wood stove project. Thanks for any thoughts or suggestions!

[David Oxhandler]

This is from a Consumers Union report ...

"Average appreciation rates of manufactured homes packaged with owned land are statistically in line with the site built market, and there are few inherent reasons that a home built in a factory should perform differently than one built on site. Our analysis suggests that consumers can make decisions which can improve the appreciation of a manufactured home. Land ownership, location, purchase price and maintenance expenditures are among the factors that predict appreciation, and should be considered when attempting to increase appreciation in a particular unit."

Source: Consumers Union Report

Be sure your appraiser is experienced in appraising manufactured homes. If the bank is selecting the appraiser, it is common today for the appraisals to come in low. This is because of consistent over pricing of all type homes prior to the housing crash. The banks have become very tight and expect (demand) their appraisers to be very conservative.


Try to find out what similar properties have sold for, recently, near yours. Appraisers are supposed to use the most recent and closest comparable home sales to make their decisions. In many areas of the county we are seeing a nice rise in re-sale prices. If you can provide some recent high sales prices of comparable homes to the appraiser it may help your case.

Some local County Tax Assessor offices have web sites today where you can see the recorded home sales prices along with the sales date. The more recent the sale the better.

[taxman]

The county in which we live does have such a website. I've done some research and it varies. Some sale prices are coming in close if not equal to the assessed value and others are not. There were a few parcels that sold for more than their assessed value. They don't list fair market value, however---only the assessed value. Our county's equalization rate was not always 100%---that happened only recently. That may skew the statistics a bit. I did email our lending officer and asked him that we be notified if the appraisers are experienced in manufactured homes. We do live in somewhat of a tourist attraction area--we have New York State maintained horse trails nearby and there have been some very expensive homes (log cabins) that have went up recently. That may help our case as well.

Where do these townships get their fair market values from? Do they use an independent appraiser as well, or do they use their town assessors? Our county tax rolls lists both assessed value as well as fair market value. In our case, the two amounts are identical (100% equalization rate).

[David Oxhandler]

Most local assessor offices use the latest resale information to arrive at a value.


Most tax assessors were not using 100% valuation before the housing crash. The decline in home values led to lower tax collections, which led to local government budget deficits. As prices drooped drastically 100% valuation has become the norm to try to stop local budget hemorrhaging.

[taxman]

There are two similar properties (one within a quarter of a mile) that sold within the past year that should give us a strong case. Both sold for more than their fair market value listed on the county tax roll. If our appraisal doesn't come in for at least what our listed fmv is, I'll be ready with a print out to defend our case.

[David Oxhandler]

In the current climate for lending, there will be no way the lender will reconsider, after the appraisal has been filed with them. Have those print outs in hand when the appraiser comes out.

Some appraisers will appreciate that you have made their job easier.. others... well there are jerks in all fields. demonstrating you are an educated consumer can only help.

Blowing your own horn is not rude. If you don't do it no one else will.

[taxman]

Good advice, and thank you for all of your information. I did check with our lending officer and they are required to use a pool of appraisers and they have to rotate them when they do one. He did say that they are fully licensed, but that's the best I can do on that one. I think at this point, all we can do is go ahead with the appraisal and I'll have those print outs ready and waiting when they pull in the yard. Unfortuately, we're pretty much at the mercy of the appraisers and the credit union, but we're taking steps to make sure that we're doing everything that we can do. The home is pretty much like we bought it, so I can't imagine why it would appraise at less than the fair market value on the tax roll. I will let you know how we make out.

[David Oxhandler]

We will look forward to hearing the rest of the story.

When they come out enhance the appearance of your home as much as possible. While appraisals are suppose to be objective the folks writing them are human and subjected to all types of subtle input.

Pretend that your mother or mother-in-law is coming for a visit. Think hotel clean. Mop, dust, vacuum, wash windows, baseboards — even the dog. Also, pay particular attention to odors. You might even consider consulting a neutral nose by having a friend come by for a smell test.

Repair squeaky doors, chipped or smudged paint as well as any broken fixtures and fittings. Get as much light into each room as you can.


De-cluttered your home, inside and out. Just like when you are selling a home, they need to see your home, not your stuff. Excessive clutter can make it difficult for the appraiser to see past your personal stuff. Taking yourself out of the picture makes it easier for the appraiser to imagine himself, and his stuff, in your space, giving him a higher opinion of value.


Let him think that you are "a regular guy... just like him". While the personal values of the home owner is no business of the appraiser, if he thinks you share his basic values he will sub-consciously feel you are generally more worthy which can make a huge difference in the way he presents his report.

Best of luck!

[taxman]

That's our project for the next week and a half. In fact, we're painting the interior this weekend (master bedroom, living room, etc). We will definitely go through the house with a fine-tooth comb. The garage will be the real challenge---not much we can do out there...it's too full of "toys" (motorcycles, snowmobiles, atv's, etc). But, it is organized. We've scheduled the appraisal for the week of the 15th-19th, so I'll let you know how we make out. Once again, thanks for the tips---you've been a big help.