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Copyright
2009
Next
Generation
Financial
Services,
a
Division
of
1st
Mariner
Bank
U
NDERSTANDING
THE
C
URRENT
H
OUSING
M
ARKET
:
“A
CTUAL
H
OME
V
ALUE
”
VS
.
“P
ERCEIVED
H
OME
V
ALUE
”
If
you
are
considering
a
Reverse
Mortgage,
understanding
your
“actual
home
value”
is
the
key
to
a
successful
transaction.
Unfortunately,
in
today’s
housing
market
your
home
may
not
appraise
for
what
you
feel
it
should.
That
is
the
real
life
situation
being
experienced
by
approximately
30%
+/
‐
of
all
applicants
for
Reverse
Mortgages
according
to
some
of
the
leading
Reverse
Mortgage
originators
at
the
recent
National
Reverse
Mortgage
Lenders
Association
(NRMLA)
convention.
Q:
Why
is
this
happening?
A:
Property
values
across
the
country
are
experiencing
rapid
changes
as
the
number
of
homes
that
have
been
foreclosed
on
are
being
sold
at
deep
discounts,
resulting
in
lowering
the
values
of
similar
type
homes
in
the
immediate
area.
In
some
areas
the
changes
from
one
day
to
the
next
can
be
as
much
as
2%
to
3%,
resulting
in
substantial
changes
from
one
quarter
to
the
next.
While
this
turmoil
in
the
real
estate
market
place
is
not
expected
to
continue
forever,
no
one
seems
able
to
predict
when
it
will
end.
Unfortunately,
until
there
is
a
stabilizing
in
the
real
estate
market
to
some
form
of
normalcy
this
phenomenon
of
rapidly
changing
home
values
will
continue.
Q:
What
can
a
person
do
to
prevent
or
lessen
the
chance
of
this
happening
to
them?
A:
Take
the
time
necessary
to
become
familiar
with
what
property
values
are
in
the
immediate
area
for
similar
type
homes
before
actually
applying
for
a
Reverse
Mortgage.
Work
with
your
Reverse
Mortgage
loan
consultant
and
invest
the
time
and
effort
to
learn
how
the
current
market
conditions
in
their
particular
area
have
impacted
the
property
values.
This
can
be
done
in
several
different
ways,
however,
as
no
one
method
is
sufficient
unto
itself
we
recommend
employing
as
many
techniques
as
possible
before
actually
applying.
While
not
a
guarantee,
at
least
you
will
be
better
informed
when
estimating
the
probable
value
of
your
home
and
the
likelihood
of
it
having
a
sufficient
appraised
value
so
the
Reverse
Mortgage
will
provide
the
benefit
amount
needed
to
allow
you
to
achieve
your
objective.
Two
of
the
most
common
ways
to
get
some
idea
of
what
your
property
value
might
be
are
as
follows:
1.
Check
the
most
recent
sales
of
properties
of
a
similar
type,
bedroom
and
bathroom
count,
lot
size,
etc.
Typically
this
can
be
done
either
by
going
on
the
internet
or
by
contacting
and
asking
a
local
realtor
who
is
familiar
with
the
market
area.
Copyright
2009
Next
Generation
Financial
Services,
a
Division
of
1st
Mariner
Bank
2.
Check
the
county
tax
records
to
see
what
value
has
been
credited
to
your
home
for
the
calculation
of
your
property
taxes.
This
is
an
effective
way
of
helping
to
establish
what
the
base
or
minimal
value
of
your
home
may
be.
About
a
HUD
Type
Appraisal
A
HUD
type
of
appraisal
is
different
from
the
traditional
appraisal
in
that
the
appraiser
will
actually
make
an
appointment
with
you
and
go
through
every
room
of
the
home
to
make
sure
that
the
property
is
up
to
HUD
standards.
Be
advised
that
while
you
may
be
proud
of
the
new
cabinets
in
the
kitchen
they
along
with
any
other
home
upgrades
which
could
very
well
increase
the
selling
price
of
your
home…they
will
have
little
impact
on
the
appraised
value
for
HUD
purposes
as
the
focus
is
more
on
the
size
and
condition
of
the
home.
So
when
estimating
the
value
of
your
home
for
the
purpose
of
a
Reverse
Mortgage,
try
to
look
at
it
as
a
HUD
Appraiser
might.
Obviously
your
NGFS
Loan
Consultant
is
prepared
to
assist
you
in
gathering
the
desired
information;
however,
it
is
important
to
note
that
they
are
not
qualified
to
provide
you
with
the
actual
value.
The
ultimate
determination
for
the
actual
appraised
value
of
your
home
rests
solely
with
the
HUD
Approved
FHA
Certified
Appraiser.
NOTE:
Current
mortgage
regulations
prohibit
lenders
using
any
appraisal
purchased
by
a
consumer
even
if
done
by
a
HUD
Approved
FHA
Certified
Appraiser.
We
are
here
to
help
Some
of
the
suggested
steps
we
recommend
you
take
when
considering
a
Reverse
Mortgage
are:
1.
Clearly
identify
what
the
dollar
amount
needed
is
to
satisfy
your
objective.
For
example,
if
there
is
an
existing
mortgage
and
or
other
debts
that
you
wish
to
pay
off,
learn
the
actual
amounts
required
for
the
pay
off
and
then
prioritize
which
you
would
want
to
pay
off
first,
second,
etc.
2.
Ask
your
NGFS
Loan
Consultant
to
figure
out
what
the
minimum
property
value
needs
to
be
(based
upon
the
age
of
the
youngest
borrower)
so
that
the
net
benefit
of
the
Reverse
Mortgage
will
be
sufficient
to
your
need.
3.
Next
check
with
a
local
area
realtor
and/or
go
to
one
of
the
realtors
web
sites
or
possibly
even
your
local
county
government
web
site
to
learn
what
the
most
recent
sales
prices
(preferably
within
the
past
90
days)
have
been
for
similar
types
of
homes
(same
number
of
bedrooms,
bathrooms,
square
footage,
etc.).
4.
Compare
the
values
of
the
most
recent
sales
to
the
minimum
value
your
home
needs
to
appraise
for
to
give
you
some
idea
before
hand
of
how
the
Reverse
Mortgage
may
perform
for
you.
In
Summary
Copyright
2009
Next
Generation
Financial
Services,
a
Division
of
1st
Mariner
Bank
At
NGFS
we
strongly
suggest
that
you
work
with
your
NGFS
Loan
Consultant
to
do
all
that
you
can
to
learn
about
the
property
values
in
your
area
before
incurring
any
counseling
and/or
appraisal
costs
in
order
to
avoid
the
disappointment
being
experienced
by
some.
H
ELPFUL
I
NFORMATION
T
O
H
AVE
W
HEN
E
STIMATING
T
HE
V
ALUE
O
F
Y
OUR
H
OME
Here
are
the
most
common
ways
to
gather
information
to
help
you
get
an
idea
of
what
your
property
value
might
be:
1.
Ask
at
least
two
local
Realtors
–
Contact
at
least
two
different
realtors
who
are
familiar
with
the
market
area,
don’t
forget
to
ask
about
foreclosures
and
short
sales
in
your
local
area
as
they
have
an
impact
on
your
home’s
value.
Remember
the
properties
must
be
of
a
similar
type,
same
number
of
bedrooms
and
bathrooms,
lot
size,
etc).
First
Local
Realtor
Estimate
‐
_______________________________
Second
Local
Realtor
Estimate
‐
_______________________________
2.
Check
the
county
tax
records
to
see
what
value
has
been
credited
to
your
home
for
the
calculation
of
your
property
taxes.
Ask
if
they
have
the
ability
to
give
you
comparable
sales
figures
for
the
last
30
–
90
days
(as
some
counties
have
recently
started
computing
this
figure).
County
Tax
Value
‐
_______________________________
County
Tax
Comparables
‐
_______________________________
3.
Check
the
most
recent
sales
of
similar
properties
(same
type,
bedroom
and
bathroom
count,
lot
size,
etc.)
on
the
internet.
Website
Estimate
‐
_______________________________
The
above
information
can
be
used
as
a
reference
to
help
you
develop
an
idea
of
what
value
may
be
assigned
to
your
home
as
it
is
similar
to
the
information
an
appraiser
will
use
when
establishing
the
estimated
value
they
will
give
to
your
home.
Note:
While
you
may
be
justifiably
proud
of
upgrades
you
have
made
to
your
home,
we
suggest
you
do
not
add
any
additional
value
for
upgrades
that
you
have
made
as
most
items
may
not
be
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