I've been talking about the new appraisal guidelines and what a problem it will be for those who want to refinance. In a nutshell, the mortgage originator will not be allowed to have any contact with the appraiser. This means that the person determining the value of your home may not be familiar with your neighborhood, your upgrades and any particular situation that will affect the value of your home. All of these “centralized” appraisals come in excruciatingly low and we are not allowed to review them to see where they have erred. If you have an abundance of equity in your property, it may not be an issue, but with the declining values, most homeowners don't have the luxury of knowing their equity is still fat and happy.
We've not run into this much with purchases. It has happened, but not frequently.
Just another reason for the lenders to spend your money (they pay their appraisers about 60% of what they charge you. Not much incentive there for the appraiser to do his job well). And it doesn't matter if you use a commercial bank, a mortgage bank or a broker. The system will be the same, with it's inherent problems.
A fellow mortgage specialist in Michigan publishes an informative newsletter on the lending world. On March 28 he wrote of a first hand experience he had with these new appraisal guidelines. Obviously the values have declined a great deal more in Michigan than California, but the principal is the same no matter where you're located. Check it out.