No I Won’t Work With This Appraiser

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Agents Blacklisting Appraisers

How much power do agents have over the appraisal process?

The lender gets a call. Agent tells them that appraiser “X” just called to set up an appointment to do the appraisal for 123 Main St. That darn appraiser killed my last deal and if he is appraising this house, I will have my clients find another lender. I flat-out refuse to work with this appraiser.

Whether it’s the listing or buyer’s agent, who put this person in charge of the appraisal process? Does the banker have to listen to them and risk losing the loan? It depends.

What’s his motivation? To protect his client and do the best job he can; or to simply get a commission. Far too often the commission wins. Many could care less if the appraiser is honest. They think they have already figured out the value and they don’t need someone coming in and checking their math. They just want an appraiser who understands their job, which in their mind is to bring the appraisal in at the contract price. The agents have already set the value and no appraiser knows better than they do about the current market.

This is happening all across the country and is getting out of control. How much power does a Realtor® have over the appraisal process? Apparently, they have decided they know best and are taking charge.

Then there’s the MLS. That’s a whole different set of problems that keeps getting worse. Puffery and flat out exaggerations (lies) are filling the MLS. Anything to get a sale and get paid. And, square footage being correct is getting worse in more and more places. Most agents aren’t going to measure a house, or pay to have it measured. They are leaning towards using tax records and figure it’s close enough. Reality is – It IS NOT!

If appraisers don’t help protect buyers, lenders and mortgage investors, and keep doing their job the best way they can, with fair and honest values, many of these rogue agents will say anything to get a deal done. Consumer protection is going backwards at an alarming rate and no one seems to be looking at agents and the MLS. Why is that? Reform needs to make a beeline for Realtors® and the MLS!

Hamp ThomasBy Hamp Thomas, founder and president of the Institute of Housing Technologies. He is also the president of Carolina Appraisers & Real Estate. He is the author of the American Measurement Standard; the Size Matters – Residential Square Footage books, continuing education courses (for agents and appraisers), the course Inside the New Appraisal Process; ANSI, Home Measurement & the Power of Price-Per-Square-Foot; Understanding ANSI, and numerous other real estate courses, webinars, videos, and blogs. Hamp also authored the Professional’s Dictionary of Real Estate Terms; Home Measurement Basics; Realtors and Square Footage; and his latest book Death of an Industry-Real Estate Appraisal.

Image credit flickr - Steve Snodgrass
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46 Responses

  1. Kim Bell says:

    What about it being a Dodd violation? Let’s look at it from that angle. Realtor/Appraiser

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  2. Diana N. says:

    I was getting a lot of appraisal work for a large subdivision in CT. there was one sale that didn’t appraise at or above sales price because of location. It was the last assignment I got. I’m sure the agent had a lot to do with that.

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  3. Wayne Courtney says:

    This is funny! A Realtard refusing to allow an appraiser to prepare an appraisal on their listing/sale. Our office has a list of Realtors that we will not accept the assignment if they are involved. PERIOD! If they are in the transaction the assignment is turned down (Pain in the ass). As I have said before…we each have a different view from our window. Our office does not accept ANY AMCs, FHA, National Appraisal Companies, etc. We cherry pick each and every assignment. We do this because we can! Of Ten assignments offered we may accept one. And that one is NOT an AMC or National Appraisal Company. Usually this assignment pays full fee in advance or at least within a week. How many appraisers are in your area? My fellow appraisers that know what I am talking about, best wishes to you. Those appraisers who are on their knees trying to satisfy an AMC…I just wish you the best!

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    • Bill Johnson says:

      As you said Wayne, the view is different out your window compared to others. I welcome your success, but keep in mind the typical appraiser is not in your shoes, and hell, might just be struggling to pay for shoes.

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      • Wayne says:

        Bill, I understand your point of view. I know that I can only do one appraisal at a time. I could be doing this one appraisal for litigation where I am modestly charging (cheating) the hell out of my client. Or…I could be doing the routine residential assignment in my area. In either case….it is an assignment that I have accepted based on the time required, fee, etc. Lets say that I do not accept either of these assignments. There WILL be another four or five assignments offered before the end of the work day. Evidently that is not the case with all appraisers in all locations. I have to ask these folks…”WHY IN HELL ARE YOU TRAINING MORE APPRAISERS?’ I have read comments from fellow appraiser idiots who babble on about public trust and how WE should train more appraisers in order to continue the profession. Are they stupid or what? This is the same gaggle of geese who deprive their family of a vacation while they send dues money to organizations that promote everyone but them!

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    • Wayne, you DO know that an appraiser can also be a Realtor without being an agent OR broker, don’t you?

      Why would you disparage an entire profession or industry by calling them realtards? Not to mention those that are developmentally disabled as well.

      We are all happy you live in an area where you are unaffected by what goes on in the rest of the appraisal world and that you are successful. Not all are so lucky. May your success continue.

      Do you post here only to make fun of peers or those with less success? Seriously. I’m curious.

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      • Wayne says:

        Mike…You are correct. i was just attempting to add a bit of humor to a sad situation. I hold a Texas Real Estate Broker license. I have my GRI  designation and also a graduate of the Studies of Advanced Real Estate Subjects provided by the Texas Real Estate Research Center at Texas A&M. This was a three year real estate program….they do not do that anymore! LOl…I have been approved to teach Real Estate by the Texas Real Estate Commission and taught at Panola College for a while. I also taught for a day or two as an appraiser instructor. All of that and $0.50 may buy a cup of coffee! I have also taken most courses required for the MAI and the CCIM. but that would just add a spoon of sugar to the coffee.

        I post here because I honestly believe that we (my fellow appraisers) can change the situation we find ourselves in. All of these folks who are giving us a boat load of crap are totally dependent upon US for their paycheck. We can turn this situation around and be in the drivers seat. HOW much money can BANK OF THE UNIVERSE make without appraisers? I can stay busy without them and you can too. How do they eat without us? Be mad at me if you want…but I am just telling the truth!

        As an additional thought I think that I really should just stop posting my opinions. It seems that very few care to read my thoughts and It does not seem that I can make any difference. I will just continue to do my thing and retire before long. I do wish all of you the best! Goodbye!

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      • Wayne, I can’t be mad at someone just because I disagreed with a single post. Besides, your emails made you a “human” Lol!

        I absolutely agree re we should be in driver’s seat. It’s not as simple as one would think though.

        Biggest problem is our innate independence and distrust of each other as a profession. Stems from the old days when we actually did real, meaningful field reviews or peers work I think. Anyway, there is distrust.

        The one organization that all looked to do something (AI) abdicated early on in favor of AMCs. They are paying the price for that now in declining membership. They abandoned their residential members in favor of MAIs that now felt a need to compete on the SFR side of business via AMC relationships.

        Almost all legislation has been self-serving of special interests.

        AGA has worked closely with ASA on some issues (CA AB 624 for one-stopping it initially). We have gotten to a point where federal agencies will listen to us now. I have received direct calls from executive director of Appraisal subcommittee and yesterday from President of NAR. We are gaining a voice.

        I hope you will join us.

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  4. Will says:

    This is also happening on FHA loans. The value might be fine but several realtors have blacklisted us the best they can because we have called out FHA required issues.

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    • Wayne says:

      It is different depending on the area you work. I have prepared thousands of FHA appraisals in the past. I refuse to accept any FHA assignment now. There are lenders in my area that still make FHA loans…they just do it without my assistance. I am old and cantankerous and do not wish to have anyone dictating to me what I will and will not do! I did accept today the $1,800 cash assignment for the small acreage appraisals that will be paid in advance and due about three weeks after I return from my cruise next week. Life is good! Tell FHA to take a hike!

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  5. Wayne Courtney says:

    Just a few minutes ago I received an email from one of our local bank clients. it said “WE ARE NOT GOING WITH AN AMC” they went on to explain their process for ordering an appraisal….Not much different from the past. I found it to be comical that they wanted to distance themselves from “AMCs”. They KNOW that if they go with an AMC they will loose 95% of their appraisers! They will be forced to accept the cheapest and least qualified appraisers in the area. That is not what they want! You chumps working with AMCS are lumped into this group whether or not you are qualified! Think about it!

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  6. Diana N. says:

    Sure wish the banks that I used to appraise for would do the same thing.

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  7. Brian says:

    Realtors have a code of ethics they must follow. If they are not being ethical turn them in to REC in your state. The same goes for not measuring houses. They are required to do it in NC.

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  8. Bill Johnson says:

    The real estate agents are buddies with the loan officers and it is common practice in my area to make it a requirement for ANY potential buyer to be forced to qualify with the lender the agent chooses. It’s in bold print for all to see in the remarks section of the MLS. This commission connection ties the two together and individually or collectively pressure can be applied to weed out those appraisers who have been labeled as trouble. The agents, loan officers, underwriters, and collectively our client (the lender), don’t want the truth; they just want the deal to close. They don’t want to hear about legal non-conforming properties, zoning issues, permits, etc. They just want the report to say, no pending litigation, no adverse effect, and the property can be rebuilt if destroyed.

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    • Bill, I’m also in California. The requirement that “buyer must pre qualify or qualify” with such and such a lender is for seller reassurance. It is so they are not taking a property off the market and only gambling that the buyer can qualify. More common in REO’s it does also exist in non REO sales. What the broker cannot require is for the buyer to obtain the loan through their desired lender or to pay any fees in connection with such a pre qualify requirement (aside from a possible credit report fee). As for the rest of the three monkeys syndrome, you are correct.

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  9. Seriously?

    The ONLY question is why this would be a surprise to ANYONE, including Author Hamp Thomas.

    It IS illegal assuming the agents cannot offer sound cause for excluding an appraiser. None would do so however because it IS completely possible for them to tell the loan officer (loan salesman) “Get someone else or we find a new lender.” No paper trail. Reason? They tell lender/AMC #1 that buyers changed their minds, had a death in family, lost their job, or that the dog ate their homework. Does which excuse is given really matter?

    There is not a damn thing anyone can do about it outside of attempting to educate NAR that this is the wrong approach. If the loan salesman is working for only a primary lender then that lender already has a confidential ‘system’ in place where they tell the AMC that appraiser is unacceptable and unless they want to lose all their AMC business make sure a new appraiser is assigned. Good luck proving it.

    AMC McGreed & Associates simply tells appraiser #1 that the deal is cancelled. They might even offer a cancellation fee for research already done so that no suspicions are raised.

    If the loan officer works with a number of lenders as a correspondent its even easier. HE is the one that gives the AMC their business and doesn’t have to worry about corporate oversight that may exist at a major bank. He simply tells AMC McGreedy not to use the appraiser…more likely he has already told them never to assign that appraiser to any of his or her deals.

    I was an agent long before I was an appraiser. Everyone in our office and almost every other Southern California office knew that you automatically cancelled when certain FHA appraisers were selected…long before AMCs.

    Dodd Frank? You mean the same law that is next to unenforceable for reasonable fees? THAT Dodd Frank? ROFL! (and I AM being polite).

    I read a quote today attributed to Tom Salomone, President of NAR, wherein he is quoted as saying (among other things) that “…appraisers can only do 2-3 appraisals day…”

    That single statement demonstrates such complete ignorance of the appraisal process and what an appraisal is that as a NAR designated appraiser and Realtor® I HAD to write and ask him to call me before allowing himself to be quoted on any appraisal related issues in the future. I’ll let you know if he does.

    By the way, all appraisers out there BRAGGING out about how you do 2 or 3 a day STOP IT! This is the kind of garbage that results! No one is impressed that you can do 2 or 3 non USPAP compliant garbage reports a day! Stop making claims that make you look like a damn fool as well as misrepresenting our profession! Sending three unlicensed ‘inspectors’ out to measure and take subject pictures and then using mls pictures to write reports is not “doing 2-3 appraisals” a day!

    NAR DOES have a code of ethics and I believe most agents try to adhere to it. Certainly most Realtors® do. Since joining the AGA I have tried to heal the rift between agents and appraisers whenever possible. It is the reason I became a Realtor® Designated (GAA, RAA) appraiser. Realtors should be our respected counterparts in the profession…not our outright enemies! So far, not much success.

    The current NAR leadership clearly needs to be educated about appraisals and appraisers. We need to try to do it in an effective manner instead of pouring fuel on a fire that no law can put out or eliminate. If his own experience has lead to these mistaken perceptions then we should not fault Mr. Salomone, but seek to correct his views.

    Citing Dodd Frank or conflict of NAR Code of Ethics and starting accusations of ‘wrong doing’ won’t solve the problem. NOR do I or will I ever advocate “making a deal work” in lieu of a solid, accurate, USPAP compliant appraisal credibly developed using sound, generally accepted appraisal practices.

    Nor will I ever let UAD, CU or any other artificial autobot system nudge me into a lower (or higher) value just because some non appraisal “review” clerk lacks the training to understand a good appraisal or a flawed AVM “thinks” I’m outside peers ranges.

    There are however a lot of things we CAN do to heal the rift and restore trust. Outreach to local Boards is one way. TEACHING agents how to “pull comparables” can help them list ‘right’ rather than relying on so called automated CMAs which are no better than AVMs.

    Where sellers insist on higher than supported prices we can educate the appraiser on the challenges ANY appraiser will be faced with, so they can prepare their clients in advance of an appraisal ever being ordered. What we do is NOT a top secret process.

    STOP the myth that we aren’t allowed to talk to agents about prices or generic values! We ARE allowed. USPAP REQUIRES us to consider all data reasonably available. Agents can be a great source of data where mutual respect and trust exists.

    It doesn’t require us to use that (agent) supplied data but we should at least be aware of it. We should also communicate that we WILL welcome any agent or owner data they consider relevant. A wise appraiser will either include it or explain why it was not deemed relevant in his appraisal report. It takes a little more effort but demonstrates appraiser independence and professionalism to all involved as opposed to leaving the impression of appraiser arrogance.

    An owner or agent telling me what they believe the value is and/or providing data they believe supports that value is NOT A VIOLATION of Dodd Frank! It’s doing THEIR job! It’s only a violation when they attempt to use undue pressure to influence me.

    NAR needs to recognize blind adherence to the wishes of new home builders and any manipulation they engage in serves no ones interest. Not the agents, not the competing brokers, not the buyers, not NAR and not the appraisers.

    Builders always wanted cheapest and fastest. Maybe they’ll start emphasizing experience and qualified, and pay accordingly instead of whining to NAR when their con jobs cant be supported.

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    • Bill Johnson says:

      Mike, Dustin Harris some blogs back on his site posted that he completes 3 to 8 assignments per day! Its my understanding that he has no other licensed appraisers working with him or for him, but rather he does the work himself with office assistance. When he is friends with Joan Trice and has a booth at her Valuation Expo, its no wonder we have an uphill battle with the likes of NAR. The powers that be don’t want the truth and will ignore the masses, however they are quick to point out the anomalies when it works for them.

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      • Wayne says:

        Just curious; Lets say Jose Hernandez wants to buy a $100,000 home in Houston, TX. He has $50,000 to pay down and his credit is Muy Bueno. He is willing to pay 9% interest on a 20 year note. He works as a political consultant for the Democratic party!

        The home is appraised by Dustin Harris with Joan Trice adding the supervisor signature. Would YOU make this loan using your personal funds? … Jose is here legally! LOL…This is not a trick question!

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      • Mike Ford Mike Ford says:

        Hi Bill, I have had talks with him on the 3 a day issue. These are overlapping assignments in which they may not all be originated on the same day. Hyperbole comes into play I suspect. I also know an exceptionally ethical SRA that I used to work for 15 years ago that uses Dustin’s methods and (generally) does two a day. There ARE assistants and the work day is not eight hours. Its not a method that would work for me but within limits does appear to work for some others.

        I tend to concur though, any association with Joan Trice and support for her projects in any way diminishes his stature (in my opinion). I am truly disappointed to hear that he supports her by participating in her events. Then again her record in the profession along with ALterra could be an article all by itself. NOTE: Readers and posters use caution if commenting about someone (could be anyone) that would consider an excuse to sue an appraiser a windfall…. like grabbing the brass ring on a merry go round.

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      • Mike Ford Mike Ford says:

        Wayne, Id make that 50% LTV loan with a comp check, AVM OR Dustin’s drive by appraisal provided he was the ONLY one signing it..

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        • Wayne says:

          To answer Mike’s comment above about making the 50% LTV loan for Jose…Like I said this is not a trick question. A 9% return is very appealing and worthy of consideration. Some of the issues I would be concerned with is the employment of Jose with the Democratic party! LOL! Also the fact that Dustin did the appraisal with Joan signing off. Dustin seems to be able to do a bunch of appraisals every day. Hell…I have been doing this for 35 years and cannot seem to average one assignment each day. Is he that much smarter that I? (somehow I doubt the hell out of that!)

          My 8 year old grandson is in the third grade G&T class at his school. He and I play speaking to each other in German and Spanish. Neither of us are good at it but just for fun!

          If someone could coach this old dog to the point that I could do 4-5 appraisals each day…I would be as rich as six foot up a bulls ass!

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    • Bill Johnson says:

      Mike, just today AppraisalBuzz (Joan Trice) posted a rehashed blog post from Dustin’s site (a couple months back) titled “Never had a Raise in 20 years? BS”. I had some long winded comments on his site to the matter. To me it reads like propaganda, however to those executives who take it as gospel, every appraiser can complete 3 to 8 assignments per day and we all make $500,000 a year (Dustin’s posted tax returns). To me Dustin is like the Cul-de-sac on the 4th of July (Beneficial, desired, popular) where everyone hangs out, (some positives), however if the property also backs the freeway and a gas station, then the other 364 days it may be considered adverse.

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      • Wayne says:

        Bill…I have never met Dustin or Joan. I have had a few email chats with Joan and she seems to be a nice lady. However she is only interested in promoting her agenda which puts the dollar into her pocket. But…who could blame her? We have so many parasites in this industry that all want you and I to pay dues, fees, etc. How many different appraisal groups are there? Many of these offer a silly designation if you bark three times and howl at the moon! NO one knows what all of these designations mean and no one gives a rats ass whether or not you have the designation. You are paying for a bunch of crap!  Really, I do not care…send your money and send your money again! No client seems to understand what the designations mean. No one cares and we can only do one assignment at a time and gee how many of these do we turn down in a week?….I understand that many appraisers are not that busy. All I can say is to market your services until you are busy. There are more appraisal assignments that you can possibly do. All you have to do is market yourself until you are busy as hell! If you are thinking AMCs…you may as well send your certification back to the state. You are totally on the wrong track! Go after real clients and let your loser competition do the AMC thing! Best wishes to all!

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      • Bill, I cant do 8 of the old style 704 drive bys (before 704D) in a day. Back in the day my record for inspection in one day including all comparables was 6. It did NOT include write ups. It’s also the same day I decided (some time in 1991 or 1992 I think…maybe 1993) I’d never even try to do more than four drive by “inspections” in a day again… and most times there after I limited myself to two-three maximum. It’s simply two much data to keep clear in your mind – so more detailed notes are required which then limits the number that can be done.

        My understanding is that Dustin has a staff that pulls comps and transmits data to him. Apparently he writes template reports in mobile appraisal software and then transmits or uploads them back for rest of PR or pure form filling stuff to be filled in – then later he does adjustments. Presumably the drones also run the regression analyses. Not my style and I can find all kinds of problems with the model for ME. But it doesn’t mean HE can’t do it. I’d raise my eyes at claims of more than 3 under his system too though. MAXIMUM and even then on a twelve hour day with all properties being fairly close….unless he also has a co pilot entering info while he dictates. So, all told if you have three or four people working on the appraisals it is STILL taking 6 to 8 man hours to complete each one.

        As for creating or promoting a false image on what we do and how long it takes, you make a hugely relevant point. Even in Dustin’s scenarios I have to ask is he really using comparable land sales or developing market extractions for land or merely assuming tax assessor ratios are right? Highest and best use analysis?

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    • Marion says:

      Don’t disparage Dodd Frank.

      When the violation is actually of TILA, which is managed by the cfpb, and it DOES enforce TILA against agents.

      Perhaps,some appraisers should check their USPAP required COMPETENCY for knowing and understanding the laws and regulations that apply to the assignment.

      You may be in a he said/she said scenario, however, these thing have patterns that regulators can follow.

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  10. Baggins - AppraisersBlogs#1 Baggins - AppraisersBlogs#1 says:

    In my experience, the new Corelogic MLS system brought about more data inconsistency issues than ever before seen. The problem is based on the ramped up automation tools, and the motivation to save time by automating just about every process with clever apps and such. Now because there are so many different ways to view market data, a fudge here or improper entry there, goes largely unnoticed.  Auto import the data, post the data, and move to the next one. And aggressive participators can now easily beat out regular single family buyers whom may be burdened by such annoying commitments like day jobs. The Matrix MLS at first had an option for agents to input, regarding where they sourced the home measurement entry. They could choose appraiser measured, realtor measured, tax records, and others. And don’t you know it, they were all entering appraiser measured, but when called to task, could not prove that. Especially in instances with fudged or improperly entered data. It will continue to be my personal opinion, that automatic assistant tools result in less data consistency over all, and play a major role regarding diminishing consumer protections. Bunch of non appraisers developing software to judge appraisers. Realty agents, partnering with big software providers for major paydays with automated realty tools. It’s not just one button mortgages these days, it’s one button 3 up’s, bpo’s, cma’s, and Corelogic AVM’s, and a host of other tools. Agent gets an impressive set of data which would otherwise have to be well researched, with generalized value conclusions right off. Then they just follow the popular trend, price high, and it’s like a night in Vegas. Forget about market caps, relevant micro analysis comparisons, substitutable qualities, or even being able to reverse engineer their thought process to attain that number. The whole thing falls apart at the bell curve, especially with any reversal of trends. But when the wave is riding upward, automation is readily embraced as some sort of absolute truth. It’s a typical situation in these typical times, too many choices. Old fashioned manual methods continue to impress. You either understand the mechanisms by which those processes work and can work them yourself, or you’re just a lemming on a track, following digital instructions. I’d like to see these software developers and MLS employees pass the tests the realty and appraiser agents had to test. The disconnect is that the software is not by appraisers for appraisers any more.

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    • Hi Baggs,

      CoreLogic is a company that used to be reasonably good at what they did. That was as a data aggregator of public records information derived from county tax assessor and county recorder information. They were about as reliable in reporting sale dates, amounts and document numbers as any of their competitors, since all used the same basic source data.

      Then they branched into other areas where they had little or no expertise including appraisal management (by purchasing RELS). They are frequently cited as some type of ‘expert’ in reporting purported real estate trends however the very nature of their source data (unfiltered or non appraiser filtered public records derived “market data”) renders their views, studies and opinions suspect.

      The underlying assumption appears to be similar to FNMA’s that Big Data washes out or diminishes market anomalies and errors in recording data.

      Many appraisers report substandard appraisal fees and the same kinds of intimidation tactics used by RELS before CoreLogic bought them.

      There use of and subsequent publication of a market trends report citing over a million appraisals as source data suggests the allegations of wrong doing may have some substance to them. Information on that ‘study’ was previously published in this blog. To date, to my knowledge no appraiser has every come forward stating that they authorized their appraisal to be used by CoreLogic for their own market studies.

      Certainly CoreLogic never came forward and explained how they obtained or reviewed millions of appraisals before they bought Rels.

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      • Baggins - Corelogic just bought this website Baggins - Corelogic just bought this website says:

        Marion had posted event after event and link after link about this companies ever and exponentially expanding correlative industry activity and holdings on the AF.  They’re quite literally the monopoly company in charge.  They’re into gse, servicing, preservation, review, origination, repurchase, credit reporting, governmental, and they literally have a monopoly presence in the industry and a hand in everything.  Seeing the little red box is code word for a company which is above the effective rule of law.  Be afraid, be very afraid.  One simple action would correct companies like this;  Fines based on income.  Fines based on income would incentivize the free market to finally be able to effectively police these monopolistic international giants.  I remember when Corelogic amc bought Quantrix.  They swapped me from a MI rep to an India rep overnight mid order (along with hefty fee chops immediately).  I asked to speak to an American stateside and was subsequently blacklisted and had all orders pulled as ‘being a racist’.  Just wait until they levy all that data taken from MLS Matrix systems to take the reigns of the FNMA CU system.  My crystal ball is glowing, and I just viewed the eye of sauron.

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      • Mike Ford, AGA, SCREA, GAA, RAA Mike Ford, AGA, SCREA, GAA, RAA says:

        Baggins, I’m sorry they treated you that way. Labeling a person unfairly as a racist is almost impossible to defend.

        I remember when OCWEN was based in Bangalore, India and the incredible difficulty in dealing with people that (understandably) had no concept of the American Real Estate market.

        I completed an international consulting assignment not long ago involving valuation of property in Delhi, India as well as future possible valuations in Pakistan, Bangladesh and many southeast Asian areas. Real estate and real state appraisal is NOT handled the same as it is in the USA (huge understatement). The goal was to develop a credible process.

        In addition to the basic differences in underlying fundamentals such as metric measurements; Vedic based numeric counting; and a purported complete lack of GLA reporting for comparable sales there is also the underlying two tiered ‘market’ to consider. (1) One is the official public market in which Government Agencies establish a so called Circle Rate that property is not permitted to be sold below (yes-that’s right); and (2) the private, non published “real rate” or grey market rate at which property actually sells at. A rate at which one has to take various participants ‘word for it’ as “verification”. Acceptance of this ‘process’ also includes widespread innate acceptance or willingness to circumvent government regulations on a pick and choose basis.

        Opposition to foreign involvement in managing the real estate processes in America doe not make one a racist. There are many challenges to overcome in delegating purely American processes to overseas firms; and miscommunication is a rule rather than exception. Miscommunication is not racism.

        Usually, we simply do not have the time or financial incentive as appraisers to reeducate those in another land speaking English as a second language; and working off checklists, all the nuances associated with real estate transactions in America.

        Its why the OCWEN model was such a failure despite their vendor-vendee association with agencies of the U.S Government (Treasury Dept.).

        The unintended consequences of allowing the profession of real estate appraisal to be micromanaged by profiteers is much farther reaching than most of us ever imagined.

        The constant acceptance of something less than full compliance with MINIMUM standards has lead to a widespread belief among all participants that “good enough” is an acceptable alternative to professionalism and adherence to standards.

        Even state regulators have adopted a “good enough” philosophy for themselves in coercing settlements against appraisers. Rarely does a USPAP compliant review appraisal precede the ‘finding’ of guilt and proposed stipulation agreements. We REALLY need to reclaim our profession.

        A good start would be to refuse to provide reports in any format other than pdf or hard copy (for a higher fee).

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  11. Baggins - AppraisersBlogs#1 Baggins - AppraisersBlogs#1 says:

    Per the other main topic of the article, I think it was either Michigan or Minnesota had at one point posted a public opinion letter by the state, that realty agents could not influence the appraiser selection. They did take that down or move the link, but I remember a few years back, many appraisers would refer to that state position statement.

    The CFPB rules cover this I think. The realty agent is an; Interested Party. And per Reg Z, Interested parties cannot participate in appraiser selection. There must be; Separation from loan production. On the other side of that coin, there is still to this day a very common method of association between many brokers through the mortgage and sales realms. It is still common for realty agents to work proprietarily with a single mortgage person, and that is the source of many a deals. Sales agent works with mortgage broker, and they constantly reference each other, either direction. Especially in scenarios like that, the MB direct and the sales agent would be associated interested parties. Neither one should have any say what so ever which appraiser is selected. Now that we’ve explored that pleasant fantasy, back to the real world. All it takes is a phone call. The appraiser has many tools to defend, but I think most of the popular ones create more problems than they’re worth. Enter the benefit of manual methods and detailed understanding of valuation process. I argue the case right there to anyone, defining my defense and solidifying my position, without having to make any other effort than speaking on the phone with my work file in front of me. And when it comes down to it, I’ll probably refuse service first. I’m not getting involved with antagonistic agents on purpose. They’ll sing a different tune in a heartbeat when the lenders have a tough time sourcing appraisers. That is coming nationally, bet your bottom dollar. It’s only a matter of time. Already happening in at least 4 or 5 states right now. That phone call goes the other direction when the appraiser refuses to manage a deal because an agent previously rejected the appraiser. That door swings both ways and the best method is to defend with a detailed workfile and strictly real estate fact based conversation or argument. If you can stop the emotional factors from gaining traction, you can stay ahead of that. Current stats CO: 27% of deals are not going through. Who are they going to cry to? They’ve already run around the track several times over and are dealing with the same old appraisers these days.

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  12. Wayne says:

    Gee. There are many who know all about the valuation requirements in their area. I think that is very smart as you should know who your competition is and what they are doing. I am lucky that I live in TEXAS! The population of Texas is about 26.96 million. (Fastest growing state in the union) However there are 254 counties in Texas. Really Texas is a very large place. Of these 254 counties there are 74 that do not have an appraiser. There are an additional 50 counties that only have one appraiser. Only 24 Counties that have 2 appraisers and eleven that have 3 appraisers. If you are the only certified appraiser within 500 miles do you REALLY give a care what an AMC wants?

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    • Bill Johnson says:

      In San Diego County alone Wayne there are over 1,000 appraisers (two others on my street) and within a few hundred miles (Southern CA) there is over 6,500 (60 % of the states population). The entire state has nearly 11,000 appraisers or roughly 15% of all licensed appraisers in the nation. I have an International border to the South, the Pacific Ocean to the West, Desert to the East, and government owned military bases to the North (open space). Although prior to HVCC my coverage area stretched to Palm Springs (2.5 hours one way), the typical appraiser of today will only cover one county (San Diego). Although the county has several cities and over 130 different zip codes, the extreme southern location is challenging to overcome. As I have stated many times before, although we complete the same forms, the challenges we face are federal, state, regional, city, neighborhood, and in my case street specific. Some areas (mine) are desperate for a floor to be established as it relates to C&R fees, while other parts of the nation are fill in the blank for fees and turn times. I received a new order today at 8:00 A.M. and had the report done and sent to the lender by 2:00 P.M. (no rush fee). This can be typical for my area and no thank you will be sent out.

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      • Wayne says:

        Yes Bill… we live in different worlds. Yesterday it was the lady wanting to hire me to do four vacant tracts of land. We agreed on a fee of $1,800 and about three weeks after I return from my cruise nest week. I just chatted with a lender wanting an appraisal of a home and about 160 acres. The fee quoted was $800 and about three weeks after my cruise. As you can see…our worlds are different. If these do not want to play… I do not care as there will be others with the next ring of the phone. The lady with the vacant land was trying to settle the estate for her husbands parents. She said she did not have nearly as much trouble with the settlement of her parents estate last year and it was 4 million…..DUH…some folks have money and then there I am! LOL

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      • Wayne says:

        When Davy Crockett was leaving Tennessee he told his friends and neighbors that they could “GO TO HELL” as he was going to Texas! Well…Bill, Texas is light years ahead of Southern California. I have a sexy lady friend that lives in Orange County….I visit her on occasion. She is a Realtor and goofy as a road lizard but a lot of fun! She is one of those Century 21 MULTI MILLION DOLLAR Producers…High income, low …. lol. Never mind, she is very cute! She makes much more that me. I am just a pitiful appraiser! LOL…she drives us to Las Vegas in her Mercedes…when I get home it is back to my Honda. Poor folks have poor ways! LOL

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    • Mike Ford, AGA, SCREA, GAA, RAA Mike Ford, AGA, SCREA, GAA, RAA says:

      Wayne I get & accept the point you are making but Texas is also the kind of place where a single ranch can encompass nearly two full counties! How many of those 74 counties are like that?

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  13. Wayne says:

    Mike….there are a lot a areas in Texas where blue bonnets and rattlesnakes thrive. There are thousands of miles of roadway in Texas with only a couple hundred TXDOT approved appraisers. I am approved but do not accept any TXDOT assignments. The cities, counties, schood districts, water utility districts, etc. etc all want appraisers. I am FHA approved but I do not accept any FHA work. I do not accept any work from mortgage brokers. No AMC work is accepted. I do not accept any USDA, IRS, on and on. How could I possibly earn a living as an appraiser? Well GEE…we turn down twice as much work than we accept. It is what it is …not trying to brag…just telling the truth. What if I were to take on litigation such as oil and gas problems, divorce, estates work, etc? Gee…I am only one old dude and very lazy! LOL We are talking about entire counties where people are being born, dying, divorcing, fussing with their neighbor, etc. etc. and there is not a single appraiser? We are talking about oil, gas, lignite, timber…yep…we are busy!

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    • I also know Texas appraisers that have broadened their services (after training) to equipment; personal property etc.. Nothing wrong with that. I too have a love hate relationship with FHA. Every decade or two they stick their heads of their rear ends and plan appraisal policy requirements. I dropped them once when they insisted ONLY Marshal and Swift be used for costs; and now again because I’m just not crawling up in attics or under houses. I could do it in my forties and even early fifties but now it’s not an option I’ll exercise. I’ll not risk my health under a house or in my case the possibility of (another) heart attack under a house where none would even be aware of it. Not likely, but still a possibility.

      If HUD wants to know whats working in a house or in an attic or crawlspace then HIRE AN ASHI certified HOME INSPECTOR! As an appraiser I ASSUME everything is working unless it’s obviously visibly broken or I’m told otherwise.

      You just gave others in many parts of the country ideas on how to expand their businesses Kudos.

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      • Wayne says:

        What a crazy business we are in! Today I renewed our advertisement in the local phone book. It is our company and two other companies in this silly book. There are approximately 75 active appraisers in our local market. Why are we paying for this advertisement when we cannot possibly accept any more work than we have now? That is a strange question as the other two companies listed in the book are as busy as we are and attempt to refer business to us all of the time. I suppose that I am from the old school and want to be on top of the mountain! Why would 75 appraisers not put an advertisement in the phone book while three of us do?

        I actually know the answer and it is that we want to be known in our market as a major player. We may not take an assignment but we want to be offered the assignment. Yes…it is a crazy business!

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      • koma says:

        Mike good point. FHA states they want us (not me anymore) to do this extra work to insure the buyer is not putting out any more money in the first couple of years of the loan. I also say if they are that “concerned” about the loan then they should make it mandatory that a Home Inspection is required and given to us before we go out to make the property observation.

        Wondering if you had any thoughts as to why FHA does not do this. Could they not just roll it into the loan?

        Thanks for listening.

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  14. koma says:

    Maybe just maybe if they don’t want you that it is a blessing in disguise. They do not want you because your ethical and will not just give them their # which will save you a headache later on down the road.

    Just my thought and thanks for listening.

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  15. Diana N. says:

    I know I’ve lost “clients” because the numbers weren’t what they wanted. I don’t care, I would rather be honest than see somebody get taken.

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  16. Wayne says:

    My friends and others. You may or may not be aware that government entities go out for bid on appraisal assignments just as they would if they were purchasing a train load of pencils. There are regional centers that handle these bids. You will need to get with them and fill out a butt load of paperwork, get a Dunn & Bradstreet rating, etc. once approved they will fill your email up with work offers from all parts of the U.S. We were signed up and did work with them until we just could not keep up the pace. Many of these jobs are large multi-million dollar projects. The companies that bid of this work such as Brown & Root, etc. MUST use a certain percentage of “pitiful” us! LOL….They cannot win the bid unless they throw a bone to the poor, etc. in our group. There is a limit as to the number of appraisals an old dog can do in one week! This source of work may be where your competitors are eating your lunch and leaving you with AMCs!

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