Appraisal News and Appraisal Tips For Real Estate Appraisers - Your source for appraisal industry news, appraisers' opinions, and discussions of appraisal issues
Mortgage giant Fannie Mae and her twin, Freddie Mac, have a message for the State of Maryland: Kindly disintegrate. A snubbed Maryland task force is close to filing its report to the governor. It attempted, in vain, to obtain detailed information about the government-sponsored twins’ valuation algorithms – tools that have replaced many home appraisals in the Old-Line State and resulted, some contend, in a feedback loop and run-up in home prices. The task force was formed on the reasonable premise that the state has an interest in the twins’ activities, since Marylanders will be left with the clean-up costs,...
…whether through redlined maps or implicit “one-mile rule,” the result can be undervalued properties in historically marginalized neighborhoods. Throughout the history of mortgage banking and lending in the United States, underwriting policies have significantly influenced the appraisal process for home purchases and refinances. Appraisers must follow underwriter appraisal review guidelines meticulously to ensure their appraisal reports are accepted by the lender. Unfortunately, in the past, these policies became the basis for redlining, wherein certain communities were systematically denied access to mortgage credit. In this article, we delve into the historical context of underwriting policies and their influence on the appraisal...
The $29 fee also happens to nearly match the average hourly base salary of $29 for UWM underwriters. United Wholesale Mortgage (UWM) began an aggressive campaign in September 2021 to recruit appraisers for their new Appraisal Direct system, which aimed to cut out appraisal management companies as middlemen. Through repeated emails, they urged appraisers – both current and former, alive or deceased – to partner directly with UWM through ANOW. Despite claims that this system would benefit appraisers by providing higher fees and faster payments, the reality did not match the hype. Fees offered by UWM through ANOW were well...
In reality, appraisers have a great story to tell, but we have a long way to go to refocus the terribly flawed “appraiser bias” narrative onto facts and science. Last week’s email from Cindy Chance, the CEO of the Appraisal Institute, marks an important and long overdue shift in the organization’s approach to addressing accusations of bias in the appraisal profession. For too long, appraisers have faced sweeping claims that their valuations are biased against certain groups, despite appraisers’ ethical standards, rigorous training, and lack of financial stake in transactions. As Chance acknowledges, the Institute should have done more to...
Thirty-seven hours after President Biden took the oath of office, White House officials met with executives at social media companies. The officials threatened restraint-of-trade lawsuits and regulatory action if the companies failed to censor what the White House deemed “misinformation.” In a parallel development, we can now connect the dots that similar talks occurred among White House officials, employees of government-sponsored mortgage giants Fannie Mae and Freddie Mac and private vendors to throttle the protected speech of individuals and firms in the mortgage industry engaged specifically for their independence. The latter serve as bulwarks in federally backed mortgage transactions. In...
Based on the local market appraisal fee, Valuation Connect values the “appraisal expertise” component of a hybrid appraisal at 18% of what the consumer pays for an appraisal. This firm hasn’t awarded us work in about two years, and they only hire us when they are in a jam, and we require the local market rate. Immediately after asking for our driver’s licenses, which we didn’t provide, we got a request for a hybrid appraisal in Manhattan, the most expensive housing market in the U.S., for a whopping $220 (sarcastically). They plan to have an unlicensed inspector walk into a...
The case eventually found its way to the U.S. Supreme Court, where it came to be known to the public as the “Sick Chicken Case” It was the Great Depression’s bleakest year – 1933. At President Roosevelt’s urging, Congress passed the National Industrial Recovery Act, a New Deal bill that partially ceded lawmaking authority to private organizations and industry boards to develop codes of conduct that would then be enforced on citizens as binding law. The owners of poultry producer Schechter Poultry Corp. were indicted for violating the new private business code for the poultry industry. The chicken men lawyered...
A recent post by an appraiser trainee on an online forum described a troubling situation involving the use of ChatGPT to generate content for an appraisal report. The trainee admitted to using ChatGPT to write a market summary section without properly reviewing it first. This resulted in factual inaccuracies making it into the final report delivered to the client. Upon discovering this, the client, a local bank, threatened to file a complaint against the trainee. The trainee is now considering falsely claiming to have personally written the problematic section in an attempt to avoid consequences. “Hey everyone, I recently used...
Mullinix has become a student of the “Title VIII Complaint Intake, Investigation, and Conciliation Handbook (8024.1).” The handbook is designed to protect citizens from overzealous federal workers. He found section after section had been violated in his own investigation by the HUD contractor. Czech-German author Franz Kafka wrote “The Trial” in 1915. The novel is a reflection on bureaucracy, power and absurdity. Its protagonist, Josef, is arrested and prosecuted by a mysterious and inaccessible authority for a crime that is never revealed to him or the reader. It’s a man’s journey through an incomprehensible and dehumanizing landscape. Ken Mullinix has...
Connolly and Mott v. Lanham, 20/20 Valuations, and loanDepot.com, U.S. District Court, Maryland. This is one of the appraisal discrimination cases that has received significant attention – among appraisers, the media and government agencies. A Black couple in Baltimore – Dr. Connolly and Dr. Mott, both university professors – filed suit in August 2022 alleging racial discrimination against loanDepot.com and the appraiser it engaged to appraise their home for a refinance. They alleged that the appraiser had taken into account their race in his valuation of their home in violation of the federal Fair Housing Act and other laws prohibiting...
Marcia Fudge is also the current co-chairperson of the PAVE Task Force Committee, so that group’s philosophy may also be modified with her resignation. I read a number of web provided publications oriented to our appraisal work, and lending. This popped into my email yesterday from Inside Mortgage Finance Publications: “As IMFnews went to press Monday, Marcia Fudge announced that she will step down as secretary of the Department of Housing and Urban Development, effective March 22. A Biden appointee, Fudge, 71, did not provide a specific reason…” USA Today: “Fudge vows not to run again “Don’t look for me...
