TAF / ASB Challenge USPAP
65 40 21
30 days after implementation of the last changes, ASB/TAF is already admitting they think the current USPAP is inadequate and requires substantial change.
They’re ALREADY Doing It Again!
On January 30, 2018 the Appraisal Standards Board announced the release of their Discussion Draft for the 2020-2021 USPAP based in part on a survey from 2017 & prior draft comments.
I’m confused. Didn’t we just have the 2018-2019? Should all those that have not yet purchased 2018-2019 just save their money and wait for the significantly revised 2020-2021 revisions? Rely on word of mouth and online excerpts in the meantime?
Doesn’t logic dictate that concerns so pressing as to require revisions to USPAP in order “to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers” would have incorporated the 2017 identified ‘needed’ changes in the 2018 draft versions of USPAP?
Thirty days after implementation of the last changes, ASB/TAF is already admitting they think the current USPAP is inadequate and requires substantial change.
Houston, we have a problem. Any ‘high level of public trust in appraisal practice’ left the building a long time ago. TAFs efforts in promoting a high level of trust are and have been an abysmal failure.
You cannot maintain high levels of anything when that high level (of trust) disappeared almost a decade ago. Nothing meaningful was done to regain it. Remember the 2008-2009 economic collapse anyone?
Remember HVCC? Remember that Countrywide and WAMU (combined) had over half a million identified appraisals where 90% failed to conform to USPAP; and 95% to 97% were identified as being grossly deficient?
What specifically did The Appraisal Foundation (TAF) or Appraisal Standards Board (ASB) do from 1991 until 2007 to prevent that collapse?
Seriously, what has TAF achieved in the past fifteen years that remains in effect today that either preserved or promoted public trust in appraisal practice?
We know that they chased after including a lot of other (often unlicensed) and unregulated appraisal disciplines under USPAP. Despite there being no mandate under FIRREA to do so.
We know that they have pursued adoption of international valuation standards, although again, there is no requirement or mandate under FIRREA to do so.
They have taken the original excellent qualifications and tweaked them to the point that appraisers have left the profession because they saw no practical path to advancement anymore; or even ability to move to other states without finding new professions or other fields of employment.
TAF has reached out to the lenders burdened under FIRREA to advocate for reduced interpretation of standards, or at least clarification that was/is so convoluted and unrealistic that those same lenders felt comfortable routinely creating conditions that violated them.
TAF has been glaringly absent from necessary battles before state or federal agencies to help appraisers fight to preserve appraisal integrity. Yet they were always in the forefront to oppose any challenge to others modifying the ‘standards’ they proposed.
While FIRREA Chapter XI addressed only American Real Estate Appraisers and Appraisal, TAF has wasted its energy trying to make R.E. Appraisal guidelines and rules fit those of other disciplines simply because we shared the term “appraiser or appraisal”. Actually, that’s not completely accurate. Business Entity Valuation practitioners called themselves Valuators to distinguish between an accountant’s value perspectives and those of lesser species real estate appraisers.
To seduce them into voluntary compliance with USPAP, we all had to change the name of what it is we are and do to “valuator / valuation” so as not to offend CPAs in general or members of AICPA.
Then they allowed these different disciplines to have input on real estate appraiser qualification requirements and standards. Those with no idea what we do get to vote on what our necessary qualifications should be. Nice touch.
Is it any wonder that 29+/- years after FIRREA was passed, members of the public don’t have a clue about the differences between a real estate appraisal and a ZILLOW or CoreLogic AVM?
TAF has reached out to institutional consumer bankers, mortgage bankers, investment bankers, National Association of Realtors®, National Association of Home Builders and management companies for their input.
They have reached out to pretty much everyone EXCEPT the public, whose trust they are charged with promoting and preserving. Does that make any sense at all? I can see an excuse in the early formative years, but nearly thirty years down the road they have still not reached out effectively to the public?
Have they effectively pointed out to ‘the public’ why AVMs are unreliable; or hybrids are inherently defective? Have they pointed out why evaluations only have uses applicable to the most sophisticated or appraisal users?
Have they pointed out (or even investigated) the fatal flaws in big data property analyses?
They didn’t even identify, or challenge FNMAs flawed Collateral Underwriter process or its current uses. Uses that FNMA itself once said it would never be used for.
Has TAF ever reached out publicly to ALL their sponsor groups and explained why appraisal results are not often conducive to those sponsors short term objectives?
Has TAF ever explained to real estate appraisers what the differences between a CMA and an appraisal are?
So, I ask again, what exactly has TAF or their Boards done to justify their continued existence as Public Trust Protectors? What is their real legacy?
Is it possible for an organization that treats appraisers as if they are “the disease” to maintain and promote public trust in their profession?
Is there one reader of this article that would seriously claim they have lived up to their FIRREA obligations? Is there on reader that thinks the public’s perception of real estate appraisals has improved since 1989-1991?
If TAF cannot prove they have achieved their primary goal in fifteen years, then it is time to try something else. Something other than rewriting core standards like clockwork every two years whether they need it or not.
TAF COULD reinvent itself and segregate all activities from real estate appraisal; and stick to their original mandate but expecting that to happen is like saying appraisers COULD perform USPAP compliant evaluations or hybrids. Neither is likely.
It’s time to end this public-private experiment. End private agencies reinterpreting Congressional laws and misdirecting state agencies. Take control away from TAF and states and send it back to the feds where it belongs.
I believe it could be done without increasing the size of ASC. In fact, I think there could be net budgetary savings and a huge reduction in federal implementing regulations dealing with state or general oversight.
It could also end the improper state regulators end run, behind the scenes lobbying for exceptions to USPAP for themselves.
WHEN it is necessary to revise USPAP, that too can be directed through ASC with input from APPRAISERS groups and users alike. All on an equal footing. Openly, with final decisions made by informed federal level appraiser trained managers such as James Park and representatives of the FFIEC.
Appraisers, SPEAK UP. End the Heinz 57 Flavor style USPAP. Forward copies of this article to your states federal legislators.