Monthly Archive: May 2014

Personal Property, permits...rules of engagement 6

Rules of Engagement

Recently a particular engagement letter format has been circulating amongst residential appraisers from several nationally chartered banks. Aside from the usual intended use and exposure time boilerplate requirements there are several new problematic inclusions. Personal Property All personal property transferring in a purchase transaction must be described in the appraisal whether or not it was listed in the sales contract. Any client is free to ask for a shopping list of tchotchkes, but if an appraiser is appraising an abandoned residence with piles of junk laying everywhere…they couldn’t afford my time to sift through it all like in an episode...

PADS - Appraisers Running for Exits 8

PADS – Appraisers Running for Exits

We urge appraisers to review the PADS Model Current economic trends suggest your appraisal practice will not survive beyond 2015. Appraisers are running for the exits, with many moving into Ad Valorem, and some into cost estimating.  Client accounts you thought were safe have been converted to ether and dispersed among a dark refinancing void. You’ve gone from completing six appraisals per week to camping by your email, in hopes of an AMC broadcast assignment appearing. Where you once had time to think about accepting the assignment, you now have less than 2 seconds to accept, because like you, ninety...

Customary but NOT Reasonable Fees 28

Customary but NOT Reasonable Fees

REASONABLE needs to become the appraiser’s operative word Appraisers, It’s time to grow a pair as some people say, or to stiffen the backbone, and quit caving in to the low ball fees being offered by some in this crazy “industry.” Another true statement is “you are what you are worth”. If you, as an business person, only know how to say yes to low fees, you won’t be worth anything higher to the majority of clients. Further, your self image and actual net worth are negatively impacted. You cannot expect to earn a certain income, then wonder why you gave yourself...

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Minimum Requirements for AMCs

Proposed Federal Regulation of Appraisal Management Companies (Minimum Requirements for AMCs) I hear a lot from appraisers concerning their interactions with various appraisal management companies (AMCs). Many keep wondering why appraisers are licensed and strictly regulated while it seems that AMCs for the most part have been left to do whatever they want. That was the case for a while; today the majority of states have already imposed regulations on AMCs. Currently, as part of the Dodd-Frank Act, a group of agencies are working together to set federal guidelines for AMCs. They are looking for feedback on these proposals and...

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Announcing VT Customary and Reasonable Fee Survey Release

Dear Appraiser Colleagues, Awhile back, you responded to a request from VaCAP to supply your e-mail address to participate in an upcoming Customary and Reasonable Fee Survey to be conducted by the Virginia Center for Housing Research and the Virginia Tech Program in Real Estate. This communication is to notify you of the survey’s eminent release. Please look for it to be sent to you via e-mail in the next couple of days. Your participation in the survey is vital to the success of this endeavor. Please take the few minutes necessary to complete the survey; it should only take...

Basement Homes and Appraised Values Gone Wrong 1

Basement Homes and Appraised Values Gone Wrong

95% of Appraisals on Homes with Basement or Lower Levels Have Errors, Errors that Affect the Home’s Value… In the majority of markets all across the country, it is virtually impossible to get an accurate appraisal on homes that have a basement or lower levels. That’s a pretty big claim. Can it possibly be true? Absolutely it can! And, it happens every day. No one in the real estate industry wants to bring this topic out in the open for fear the public would be outraged. Well, it’s time somebody gets mad. And for all the Realtor’s® big talk about...

XML MISMO UAD appraisal 0

VA Appraisals Must be in MISMO XML

VA Announces Electronic Appraisal Requirements: Appraisals must be in MISMO XML Effective June 1, 2014, all Department of Veterans Affairs (VA) appraisals will be processed in WebLGY under the VA Appraisal Management System (AMS). Therefore, beginning June 1, 2014, all VA appraisals must be uploaded in WebLGY in Mortgage Industry Standards Maintenance Organization (MISMO) compliant XML 2.6 GSE file format as VA will no longer accept appraisals uploaded in WebLGY in PDF format. Prior to June 1, 2014, VA appraisals must continue to be uploaded in WebLGY in PDF file format. Historically, VA appraisal form/formats conformed to appraisal industry form/format...

Good news appraisal profession 5

Good News….For a Change?

Appraisers to be paid within… It is all-too-rare that we hear positive news regarding the appraisal profession. There is an awful lot of complaining that goes on, most of it justifiable, but little good news that gets shared. Part of the problem is that there is no central source for information regarding our profession which appraisers might utilize in order to find out what is going on across the country and affecting our profession, and could be used to enhance our industry and our citizens in our own state. From what I have seen, most of any good news is being...

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Back to Basics (Part 2): The Cost Approach – An Approach to Value, Without Worth, Really?

The foundations of appraisal were based upon three independent approaches to value. A system, when developed correctly, presents a check and balance within the report. The idea being that when an appraiser takes the time to develop each report, the data will show three independent motivations and three separate value conclusions. Nonetheless, the conclusions will support one another because the underlying principle for each approach is the principal of substitution. For the purposes of valuation or real estate appraisal, the principle of substitution is defined by practical application. Simply the idea that a prospective purchaser will pay no more for...

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Back to the Basics

The more I read residential mortgage related appraisals, underwriter comments and comments from the quality assurance departments from major lenders, the more I have come to realize that it is far beyond time to get back to “preaching” about the basics of this industry. For those of you who have been in the business back when you would take the photos, pull it out of the camera, wait a few moments before you pulled the front off the photo before coating it with the “magic wand” to keep it from fading (thank you Polaroid), I would recommend moving on to...

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