Home Equity Valuation Solutions

Why does a home equity loan require a valuation?

Lenders require a valuation for every type of home equity loan. They do this to protect themselves from risk of default, in case you can’t repay the loan. It also protects the borrower by having a deeper understanding of your properties current value.

Who pays for the valuation on a home equity loan?

In most cases, the lender orders and pays for the valuation. Stewart Valuation Intelligence can help you control costs by offering different product options depending on risk and underwriting criteria.

Why can’t I just use an AVM to value a property for a Home Equity loan?

Prior to the 2008 housing crisis, most lenders used automated valuation models as a cost-effective solution for home equity valuations. Regulation post-crisis has made it so that property condition, in some instances, has to be confirmed to use an AVM.

I thought I could only use drive-by appraisals for home equity valuations?

Many companies can only provide appraisal-based solutions, limiting your choice. Stewart Valuation Intelligence offers AVM, Agent/Broker and Appraiser derived solutions and can match products to your need and credit-risk policy.

Is there a cost-effective way to add interior photos to a solution?

Stewart Valuation Intelligence’s VALIDITY homeowner guided inspection tool can be used in conjunction with many of Stewart Valuation Intelligence’s solutions to give you a view inside the property in question.

As an appraisal management company (AMC), does SVI align with Fannie, FHA and Freddie on limiting the allowable number of comparables to five?

SVI does align with Fannie, Freddie and FHA for an allowable number of comparables. It is important to recognize that market data is different from true comparables. Per the Fannie Mae Selling Guide: The appraiser is responsible for determining which comparables are the best and most appropriate for the assignment. Fannie Mae expects the appraiser to account for all factors that affect value when completing the analysis. Comparable sales should have similar physical and legal characteristics when compared to the subject property. These characteristics include, but are not limited to, site, room count, gross living area, style and condition. This does not mean that the comparable must be identical to the subject property, but it should be competitive and appeal to the same market participants that would also consider purchasing the subject property. Comparables that are significantly different from the subject property may be acceptable; however, the appraiser must describe the differences, consider these factors in the market value, and provide an explanation justifying the use of the comparable(s).