Credit crunch tightens rules for appraisals

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Lenders' underwriters are scrutinizing all aspects of the mortgage process, not just the borrower's creditworthiness. Even a borrower with a high credit score, a cash down payment and verifiable income can run into snags in the mortgage approval process today if the lender's underwriters are concerned about the value of the property. Here are some of the recent changes in the appraisal process that could affect you. Up until recently, underwriters usually rubber-stamped an appraisal report if it included information about three comparable properties that sold in the area within the previous six months that supported the purchase price of the property being appraised. Due to the fact that property values are under pressure in some areas, lenders may ask to see information about comparable listings that sold within the last three months. The more recent the comparable, the more indicative it is of current market value, particularly in a changing market. For some lenders, inf...