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No Appraisal Refinance Coming?

Posted on | March 12, 2009 | 4 Comments

no-appraisal-refinanceThe “Great Refi Boom” has been greatly hindered by current appraisal values of homes.  The lending process comes to a screeching halt when lenders find out that the appraised value of a home has decreased over 30% in the last year.  Lenders are not willing to fund these mortgage applications.  This is happen more often than not throughout the country, making it extremely hard to refinance since rates have started falling.  Is the answer to this problem no appraisal refinancing?

Wells Fargo offers some very good information on no appraisal refinancing here.  This comes on the heels of Wells Fargo tightening their guidelines beyond what Fannie, Freddie and FHA require.  In the last month, Wells Fargo made the annoucement they will be raising credit score requirements to 620 for FHA it funds.  To put this in prespective, 620 was considered a prime borrower for a jumbo interest only loan less than a year and a half ago.  The following is stated on the Wells Fargo website:

Wells Fargo Wholesale Lending group will require two new requirements for FHA and VA transactions: a minimum loan score of 620 is required, regardless of any automated underwriting system (AUS) decision, and a payment history for FHA streamline refinances and VA interest rate reduction refi loans. (No 30-day or greater mortgage lates in the most recent 12 months will be allowed for FHA Streamline Refinances and VA IRRRLs.)

With this knowledge, a no appraisal refinance is even much more important for many borrowers.  With the value of many homes falling as much as 50%, the appraisal process is a scary thought for those who desire to refinance.  Once again, the Obama administration is trying to lighten up the requirements, but it will be very interesting to see if the lenders come through with their commitments.

If you have gotten a no appraisal refinance lately we would like to hear from you.  Was it like pulling teeth or was it a process you found to be relatively easy?  In the coming months, many will look for no appraisal refinances and we would like to help them gain perspective.


Category: Refinance

Comments

4 Responses to “No Appraisal Refinance Coming?”

  1. Flash1
    March 13th, 2009 @ 7:09 am

    Good News for many entrepreneurs and business owners actually people who have resources!! I don’t know if it would help average homeowners though. Can you give us MORE info??

  2. Refinance Your Home: No Appraisal? : Bizzia
    March 14th, 2009 @ 3:50 am

    [...] lenders are trying to comply with the president’s foreclosure prevention plan is by offering no appraisal refinancing. In this type of refinance, an appraisal is not required for approval. Of course, with the latest [...]

  3. About
    March 21st, 2009 @ 4:30 pm

    About…

    … [contact-form 1 "Contact form 1"]… – Subprime Blogger / No Appraisal Refinance Coming? ……

  4. mister d
    May 10th, 2009 @ 2:54 pm

    No appraisal in a declining market is borderline retarded. This is HUd simply kicking the can down the road and putting the burden on the taxpayers. I predict over a trillion dollars in losses over the next two years for fannie, freddie and FHA. HUD was established to assist low income home buyers, not support the banks fraudulent lending practices by making poor lending decisions to support their bloated principal balances. HUD is a criminal enterprise not a government sponsored enterprise and everyone in the industry knows this.

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