Mary Cummins, Real Estate Appraiser, Real Estate Appraisal, Los Angeles, California, Mary Cummins.

Mary Cummins is a real estate appraiser in Los Angeles, California with 38+ years of experience. Cummins provides real estate appraisals for banks, lenders, mortgage brokers, Appraisal Management Companies (AMCs), lawyers, Courts, factors and private parties for lending, lawsuits, probate, estate planning, divorce and all types of litigation. Cummins provides 1004, 1073, 1025 and other form reports, narrative reports and historical appraisals besides real estate research and appraisal advice.

Thursday, April 17, 2025

Appraisal Institute Class "What Appraisers Need to Know About Property Insurance" by Mary Cummins

Attended the class "What Appraisers Need to Know About Property Insurance" by the Appraisal Institute. It was hosted by Appraisal Institute - Southern California Chapter and SCCAI Eastern Branch, Northwestern Branch & RICS California Chapter. Presenters were Joe Derhake, Thomas Dawson and Bryan Hill. Met the manager of the restaurant Tamayo Restaurant and Art Gallery who gave me a tour of the art gallery. $6.5M worth of art in the 1928 building which used to be the DMV. There was one other woman there. Learned some interesting things about insurance and the recent LA fires. #realestateappraisal #propertyinsurance #SCCAI #RICS #marycummins #realestateappraiser

From the class description

"TOPIC: Basics of Property Insurance. What Appraisers Need to Know.

As extreme weather events like the 2025 Los Angeles wildfires grow more frequent and severe, property insurance is becoming an increasingly critical concern for appraisers and property owners alike. In some cases, soaring insurance rates have rendered assets virtually uninsurable. This session explores how environmental due diligence and clear communication of value can help mitigate insurance risks and improve outcomes for clients.

Session Overview:

• Joseph Derhake, PE, will discuss the insurance crisis through the lens of recent climate-related disasters, including the L.A. fires. He will explain how due diligence data can be used to increase a property’s climate resilience and support better insurance outcomes. Attendees will learn practical strategies for assessing risk and mitigating environmental impacts in high-risk areas.

• Thomas Dawson, ASA, will introduce core insurance concepts relevant to personal property appraisers. His presentation will cover:

o How to communicate the value of appraisal services for insurance purposes.

o How to empower clients to ask the right questions when dealing with insurance agents.

o The key roles and responsibilities in the insured-insurer relationship.

o The claims process and how to support clients with real-world examples.

• Bryan Hill, CAC, will provide first-hand insight into the environmental impact of the L.A. fires and current approaches to mitigation. His extensive experience in wildfire response and disaster assessment will help attendees understand how appraisers can work alongside environmental experts in post-disaster scenarios.

Speakers:

Joseph Derhake, PE

Founder and CEO, Partner Engineering and Science, Inc.

Joseph Derhake has over 25 years of experience as a professional engineer and leader in environmental and engineering due diligence for commercial real estate. He has overseen thousands of transactions, investigations, and remediation projects, while contributing to policy development at major financial institutions. His background bridges technical, environmental, and financial considerations within the commercial property space.

Thomas Dawson, ASA

Appraiser and Insurance Specialist

Thomas Dawson brings over a decade of experience at the intersection of insurance and personal property appraisals. A certified commercial insurance specialist since 2016, he has quoted and managed thousands of policies covering homes, autos, fine art, musical instruments, manuscripts, and other collectibles. As an ASA-accredited appraiser since 2017, Dawson specializes in high-value personal property with a focus on musical instruments and music collections. He also has a background in music performance, production, and licensing.

Bryan Hill, CAC

Technical Director, Partner Engineering and Science, Inc.

Bryan Hill has over 20 years of experience in environmental consulting and industrial hygiene, including 15 years focused on wildfire response and post-disaster services. As a California Certified Asbestos Consultant, he specializes in indoor air quality, hazardous materials management, and environmental risk assessments related to climate disasters. His hands-on experience in wildfire zones brings a critical perspective to property assessment and recovery."

Some notes. I was hoping to get a copy of the slide deck so I didn't take a lot of notes.

Immediately after the fire rents and home prices briefly went up as people quickly grabbed needed rentals and homes. Those prices came back down quickly. Manhattan Beach went up 15% temporarily. Some higher priced rents went from $15-$25K/month. There was really no price gouging enforcement in the higher range.

There are about $75 billion in insured losses and $100B uninsured.

It'll take probably 5-6 years to build back after fires based on past fires.

Most hard lumber comes from US. Most soft lumber comes from Canada. We have wood in US.

We may not have enough local labor to rebuild. They will come from surrounding counties. Building construction was previously down because of interest rates.

US made products and businesses will be raising prices also when non US prices get higher from tariffs. It's human nature.

Some areas in Altadena will need extra soils reports to rebuild because of landslide zones. They will need extra reinforcement for same reason. (same with Palisades)

Smokers = Homes which survived fire but have interior smoke damage.

It costs about $30K to clean a smoker home.

Attics are contaminated from ash, dust, char from fires besides heavy metals like lead. Lead max level is 10 micrograms. Lead dust can come in through the best windows because of drainage holes and the intense winds.

Fire debris is removed by the wet method to limit dust for this reason.

Palisades land value going down as more supply comes on the market.

The best architectural properties in Chicago were built after the Chicago fire of 1870. Maybe same will happen in Palisades.

Insurance presentation

Insurance forms HO3 most common. HO4 is for renters. HO5 is to replace the home and contents combined.

Cash value is replacement value minus depreciation. Antiques are valued differently as they have already been depreciated all the way.

Insured must prove loss as part of insurance contract. They must provide photos, videos, appraisals of lost items or the claim will be denied. You can appraise item after the loss if you have photos. Videotape, photograph your possessions, home every six months to a year. Keep that in a safe place in case of fire. The cloud? It's best to itemize high priced items on insurance application ahead of time.

You don't get the insurance home replacement value until you actually replace the home and have receipts.

Insurance prices have risen from about 40-80 cents a sf to $1-2 today for commercial property.

The insurance company uses a software system to calculate value based on size and materials.

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.

Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin

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Mary Cummins

Mary Cummins of Cummins Real Estate Services has been in real estate since 1983, over 35 years. She is licensed by the Bureau of Real Estate Appraisers. Mary Cummins was an agent and broker licensed with the California Department of Real Estate selling residential income, commercial buildings, raw land and homes for Merrill Lynch Realty in Beverly Hills and Westside Properties in Los Angeles before concentrating on appraisals. Mary Cummins currently provides real estate appraisals, expert witness testimony, historical research, legal real estate research for mortgage brokers, banks, lawyers, factors, insurance companies, financial consultants and private individuals. Mary Cummins was born and raised in Southern California. Cummins attended Beverly Hills Good Shepherd Catholic School and Beverly Hills High School. Besides being on the Dean's list, Mary Cummins was a top ten national swimmer and competed on the men's water polo team. Mary Cummins began college at the age of 15 attending the University of Southern California on scholarship, majoring in Psychology/Sociology. http://www.animaladvocates.us http://www.facebook.com/AnimalAdvocatesUSA

Tuesday, April 8, 2025

Only Four Permits Issued in Palisades Fire Area in 90 days by Mary Cummins Real Estate Appraiser

92 days post fire and only four permits have been issued to rebuild in the Palisades. Two of the permits are just smaller repairs. These people are forced to rebuild and repair. These aren't all developer spec homes. It will cost over $70,000 each in permit fees to rebuild. The City needs to keep promises about waiving some fees and slashing red tape and time frames. This is going to be a long expensive haul no matter what the state and local politicians have promised. It always is.

A quote from the article "Although this area has been branded as uber-wealthy, the majority of Palisadians were middle-class, 25 percent were senior citizens, and the majority don’t have the money it will cost to rebuild. Unless there is some financial assistance, people will not be rushing to pay for plans to rebuild."

I work in this area. The wealthy people live in the rarer larger luxury homes on the ocean, coast or in the hills with full ocean, coast views. Most homes are older average sized standard construction tract homes with no views in the flats. Most homeowners are not uber wealthy. Sadly if they can't afford permit fees, they can't afford construction fees or holding costs. They will be forced to sell their lots and move to a much less expensive area.

One resident said they had received an invoice for $1,338 for a permit fee for the Grading Department to review a soils report. These homes already had approved soils reports for the previous home on file. They had to spend at least $10,000 for a new soils report. The time and money involved in new construction is crazy. I hate to say I told ya so, but I said that it'll take as much time if not longer than the Malibu Woolsey fire to recover and rebuild. As of February 2025 "Fewer than 40% of the 465 homes destroyed by the 2018 Woolsey fire in Malibu have been rebuilt." The scale of the Palisades fire is much, much larger. It'll take even longer and cost a lot more.

Full article from Westside Current.

#losangeles #palisadesfire #palisades #permits #marycummins #realestateappraiser

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Mary Cummins

Sunday, April 6, 2025

Is my Condo Blacklisted by Fannie Mae, Freddie Mac Lenders? List of Requirements by Mary Cummins Real Estate Appraiser

Ever since the 2021 Surfside condo collapse in Miami, Florida lenders are worried about the condition of older condominium projects. Lenders do not want to loan on a project where their equity is not secured by a livable building in good safe condition. For this reason many older condos are denied funding backed by Fannie Mae and Freddie Mac.

Mae and Mac maintain a "mortgage blacklist" of condo complexes deemed ineligible for their mortgage programs. I've emailed them asking for it but they refuse to share it publicly. The condo projects are denied due to concerns about inadequate insurance, structural issues or insufficient reserves. This makes it difficult for owners to sell or refinance using these loan programs. This "blacklist" is basically a list of condo complexes which have been denied funding based on these requirements. This does not affect non Mae and Mac mortgages but if the project doesn't meet these requirements, they may still be denied by other lenders.

The most important thing a condo owner can do to prevent their condo from being blacklisted is fully research the project before you buy, sell and as you own it. Be sure to get a copy of all documents especially the budget, inspection report and the condo reserve report. A good condo project will have all future repairs noted with 70% of the future repair costs already paid in a reserve fund. The funds come from the HOA dues.

The problems arise with older buildings which need more and more repairs as they age. HOA dues don't always cover the increasing expenses so dues must be raised from time to time. Special assessments are needed for the larger unplanned repairs. Some condo owners don't want to pay increased HOA dues or assessments because they are on fixed incomes. Condo owners must vote for special assessments. This is what happened with Surfside condos. They knew they needed major repairs but the collective owners refused to vote for the larger HOA dues and special assessments to get the work done. The building also had structural issues when it was first built which needed to be repaired.

Here's a more detailed breakdown of what Mae and Mac need to see before they will fund a condo. I got this information from Fannie Mae and Freddie Mac websites.

Reserve Fund Requirements:

Minimum Reserve:

Fannie Mae and Freddie Mac require that a condo project have a reserve fund that is at least 10% of the annual operating budget.

Reserve Study:

A current reserve study, conducted by a qualified professional, is essential to determine the adequacy of the reserve funding plan.

Funding Plan:

The reserve study should include a funding plan that outlines how the association will reach and maintain the minimum reserve level.

Reserve Study Content:

The reserve study should include an inventory of major components, a financial analysis, and an evaluation of the current reserve fund adequacy.

Reserve Study Frequency:

It's recommended to have a reserve study performed and updated every three years by a qualified professional.

Reserve Study Compliance:

The reserve study must meet or exceed requirements set forth in any applicable state statutes.

Delinquency Requirements:

Delinquency Limit: No more than 15% of the total number of units in a project can be 60 or more days delinquent in the payment of their HOA assessments.

Other Important Considerations:

Critical Repairs:

Mortgages secured by units in condominium or cooperative projects in need of critical repairs are not eligible for sale to Freddie Mac.

Lender Review:

Lenders are now required to review all structural and mechanical inspection reports, including reserve studies, completed in the prior three years from the loan project review.

Unfunded Repairs:

Lenders are prohibited from issuing loans for complexes with unfunded repairs totaling $10,000 or more per unit.

Special Assessments:

Lenders must obtain and review information for any special assessments imposed by condominium associations to determine if they address a critical repair.

Insurance:

The project must have insurance that complies with the applicable requirements.

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Mary Cummins

Saturday, April 5, 2025

AEI Finds Waiver Bias in GSE Appraisals by Mary Cummins Real Estate Appraiser

Interesting new study out by American Enterprise Institute (AEI) shows appraisal waivers have more bias than human appraisers. They are more likely to hit the needed loan to value (LTV) target to qualify for lower refinance rates and approvals.

"Evidence of Potential Gaming of Appraisal Waivers: Waivers Demonstrate More Anchoring than Human Appraisals. It is well known that LTVs are heavily anchored to certain percentages. Anchoring is the use of a value that ones knows in order to make a decision or value estimate. In the case of refis, these anchor points interact with the applicant’s perception of home value and the refinance amount and any cash proposed to be extracted from the home."

Appraisers don't know the LTV target or needed refinance value. The borrower who estimates the value of their own home obviously does. The borrower with help from the lender submits an estimate of value when using appraisal waivers. Looks like confirmation bias to me. I think these waiver robots need to take a mandatory CE class on bias just like appraisers. That will surely fix the problem ;-)

Read the full study here. Lots of great stats and charts like the one above.

https://www.aei.org/research-products/report/prevalence-of-gse-appraisal-waivers/

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Mary Cummins

Friday, April 4, 2025

Court Dismisses Discrimination Claims Against Appraiser by Mary Cummins, Real Estate Appraiser

Henley's Motion to Dismiss, Doc. #28, is SUSTAINED.

Link to case below

"A federal judge has dismissed all claims against an appraiser and their firm in a lawsuit alleging discrimination in a home valuation. The court found that the plaintiffs failed to establish a viable legal claim against the appraiser, ruling that their allegations did not sufficiently demonstrate wrongdoing under applicable laws.

The case centered on a disputed appraisal that plaintiffs claimed was racially biased. However, the judge determined that the appraiser’s valuation process did not support a claim of discrimination. With this ruling, the appraiser and their firm are no longer part of the lawsuit.

While claims against the appraiser were dismissed, the court allowed certain claims against a bank to proceed, focusing on the bank’s lending policies and loan approval decisions. These claims will be evaluated further as the case moves forward. Specifically, the plaintiffs claim the bank applied different loan-to-value (LTV) ratios based on race and national origin, offering more favorable terms to white borrowers. They also allege the bank refused to finalize a loan application with better terms due to discriminatory policies. Additionally, the plaintiffs argue the bank maintained a policy preventing borrowers from appealing appraisals they believed to be discriminatory. The bank contends that loan denials were based on credit history rather than discrimination, the court determined that the plaintiffs presented enough evidence for these claims to proceed.

Negligent Hiring, Training, and Supervision

The court also allowed claims against the bank regarding negligent hiring, training, and supervision of employees. Plaintiffs argue that bank employees failed to properly evaluate loan applications, process appraisal appeals and oversee contracted appraisers. The court found that these allegations were specific enough to warrant further examination.

Implications for Appraisers

This case—Carlos Turner, et al. v. Henley Appraisals, LLC, et al. (Case No. 3:23-cv-371) in the U.S. District Court for the Southern District of Ohio Western Division—highlights the importance of clear appeal mechanisms for borrowers who suspect discrimination and raises questions about lender oversight of the appraisal process. Appraisers should stay informed on evolving legal standards and lender policies to ensure compliance and fairness in their work."

Link to case ruling. Large file but only 28 pages.

https://cases.justia.com/federal/district-courts/ohio/ohsdce/3:2023cv00371/286793/33/0.pdf

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Mary Cummins

Wednesday, April 2, 2025

Caruso Palisades Village Will Reopen Beginning of 2026 by Mary Cummins Real Estate Appraiser

Rick Caruso stated today that the Palisades Village will reopen in the beginning of 2026. Caruso said they are waiting for the properties around them to be cleared of the toxic remains of the fire. They don't believe it will be safe until the cleanup is complete. They will also be refurbishing the mall.

Caruso stated that the 130,000 sf Palisades Village located at 15225 Palisades Village Lane in Pacific Palisades, California survived for a number of reasons. The Village which has 40 boutiques, restaurants and shops was built in 2018. It was built to survive wildfires. Caruso also hired his own private fire fighters and water teams to fight the fire.

www.palisadesvillageca.com

https://caruso.com/our-portfolio/palisades-village/

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Mary Cummins

Sunday, March 30, 2025

Fire Victims May Incur Casualty Tax Gains by Mary Cummins Real Estate Appraiser

If your post fire insurance settlement is over your initial home cost basis, i.e. original purchase price, you could owe a casualty gain to the IRS. You can defer the gain if you use the insurance settlement to rebuild or buy a replacement property within two to four years. Any gains from the sale of the lot will also have to be reinvested in a new home to defer gains. You could use the home sales tax exclusion to shelter $250-$500K of the gains. See below for more specifics. This is complicated and you should consult a tax professional.

"Dear Liz: My house was burned down in the Palisades fire. I lived in the house for 25 years and lost everything. I thought there may be a silver lining with tax deductions. Much to my surprise, I am supposed to use the purchase price from 25 years ago as my adjusted cost basis. The insurance settlement is not going to be enough to rebuild but is more than my cost basis. I will end up with “casualty gain” instead. Is this possible?

Answer: After losing your home and finding out you were underinsured, the news that you might have a taxable gain must have been a gut punch.

The IRS calls it an “involuntary conversion” when your property is destroyed and you receive insurance proceeds. If the insurance payment exceeds your tax basis in the property, that’s known as a casualty gain.

You can defer tax on this gain if you use the insurance payout to rebuild or buy a replacement property, says Mark Luscombe, a principal analyst with Wolters Kluwer Tax & Accounting. Normally you’d have two years to use the insurance proceeds, but in a federally declared disaster such as the Los Angeles fires, the deadline is extended to four years.

The IRS may be willing to further extend the deadline under some circumstances, such as contractor delays, Luscombe says. But don’t count on an extension if you’re simply unable to find a replacement property.

If you do purchase a new home elsewhere, any gain from the sale of the lot where your previous home stood also would have to be reinvested in the new home to avoid a current tax on the gain, Luscombe says.

However, the home sale tax exclusion also applies to involuntary conversions. The exclusion allows you to shelter up to $250,000 of gains ($500,000 if married filing jointly) on a sale or involuntary conversion, as long as you’ve owned and lived in the property as your primary residence for two of the last five years. So you could exclude that amount of gain and defer the rest if you rebuild or find a replacement property, Luscombe says.

This is complicated territory, so please make sure you hire a tax pro to guide you."

https://www.latimes.com/business/story/2025-03-30/losing-a-home-in-a-fire-then-being-hit-with-a-casualty-gain

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Mary Cummins

Mary Cummins, Real Estate Appraiser, Animal Advocates, Los Angeles, California

Thursday, April 17, 2025

Appraisal Institute Class "What Appraisers Need to Know About Property Insurance" by Mary Cummins

Tuesday, April 8, 2025

Only Four Permits Issued in Palisades Fire Area in 90 days by Mary Cummins Real Estate Appraiser

Sunday, April 6, 2025

Is my Condo Blacklisted by Fannie Mae, Freddie Mac Lenders? List of Requirements by Mary Cummins Real Estate Appraiser

Saturday, April 5, 2025

AEI Finds Waiver Bias in GSE Appraisals by Mary Cummins Real Estate Appraiser

Friday, April 4, 2025

Court Dismisses Discrimination Claims Against Appraiser by Mary Cummins, Real Estate Appraiser

Wednesday, April 2, 2025

Caruso Palisades Village Will Reopen Beginning of 2026 by Mary Cummins Real Estate Appraiser

Sunday, March 30, 2025

Fire Victims May Incur Casualty Tax Gains by Mary Cummins Real Estate Appraiser