Category: E&O

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Read That Agreement Before You Sign or Leap

Having the most unfair agreement will cause the lender or AMC to lose those appraisers I recently ran across the provision below in a new contractor agreement between an AMC and its panel appraisers, when one of LIA’s insured appraisers asked me to take a look at the agreement. The contract contained the average indemnification provision found in most unfair AMC contracts in which an appraiser promises to defend and reimburse the AMC for “any and all liabilities, damages, costs and expenses (including all legal fees) arising out of or relating to any claim, action, suit, complaint, liability, damage, or other...

Home Inspectors Appraisers Doomsday 6

Home Inspectors & Appraisers’ Doomsday

The Sky is Falling for Appraisers & Home Inspectors Chicken Little was right – the sky is falling…and landing on both appraisers AND home inspectors. Home inspectors often suffer from a general lack of respect, part of which is caused by the fact that they have no single set of national standards of practice like appraisers who have USPAP. Appraisers, on the other hand, suffer from what is commonly known as appraisal creep where the conditions and requirements of appraisal work keep expanding, but the fees for the work either shrink or stay the same. Now, forces within the government...

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AQB Releases December 2012 Q&As

TJ’s Rant… Almost all of the questions deal with Supervisor – Trainee issues that will change in 2015. If like me, you believe it is difficult enough to find people to become appraisers today, just wait until you read all of the new requirements. I don’t understand where the AQB is coming from with all these new requirements. Do they really believe that someone will want to go to college (at an average cost of about $120,000) to get a degree and then become a Certified Residential appraiser who would be lucky to make $20,000 for their first few years...

Seven Cases the Defendant Appraisers Won Based on Expiration of the Statute of Limitations 0

Seven Cases the Defendant Appraisers Won Based on Expiration of the Statute of Limitations

I am biased in favor of defendant appraisers. I always root for the defense, even if it’s one appraiser suing another appraiser (as in one case below). Defense is our business. Here, are seven cases where the defendant appraisers won based on a statute of limitations defense. That means even if there was something wrong with the appraisal at issue, the defense counsel still won the case. So, you have to give the credit to the defense counsel. That’s not to say there really was a problem with the appraisal in each case below — it just didn’t matter if...

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Who Has Been Suing the Most Appraisers?

Two Names You Know. Two Names You’ve Probably Never Heard. These are four of the parties who have been suing the most appraisers in 2011-12. I suspect most appraisers won’t recognize two of the names, unless the appraisers are defendants in one of their cases. The parties are in no particular order, but the last one does file the most lawsuits. LSF6 Mercury REO Investments This is an investment fund of a private equity company named Lone Star. LSF6 bought discounted mortgage debt from bankrupt CIT Group in 2008. In late 2011, LSF6 began suing appraisers in New York as...

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FDIC Diversifies Its Appraiser Targets in Recent Lawsuits

In the last three months, since May 1, 2012, the Federal Deposit Insurance Corporation (FDIC) has sued 45 individual appraisers and appraisal firms in its capacity as receiver for one of the failed banks or lending institutions under its supervision. The appraisers targeted by the FDIC in its recent cases are a more diverse group, geographically and professionally, than in earlier cases, but in other respects the FDIC’s recent cases represent more of the same familiar story — suing appraisers to recover money damages for allegedly appraising properties too high for loans extended during the peak of the real estate...

West Virginia Riskiest State for Appraisers 2

West Virginia Riskiest State for Appraisers

West Virginia has been among the riskiest states in which to be a residential appraiser for several years. It’s my educated guess that a residential appraiser is more likely to be sued in West Virginia than in any other state. A plaintiffs’ law firm has elevated that level of risk to a nightmare for one particular AMC and its panel appraisers in West Virginia who performed appraisals for certain loans by the AMC’s primary client.

At the end of June, the law firm filed an alleged class action on behalf of residential borrowers residing in West Virginia against Title Source, Inc., which operates TSI Appraisal; Quicken Loans, which is the AMC’s corporate affiliate and primary client; two of the AMC’s panel appraisers; and all other appraisers

Should I Attach My E&O Declarations Page to My Appraisal Report? 2

Should I Attach my E&O?

Should I attach my E&O Declarations Page to My Appraisal Report? Because some AMCs still wrongheadedly insist that appraisers do it, we are asked this question a lot: “should I attach my E&O declarations page to my appraisal report?” The answer is always the same: it’s a bad idea. It’s bad for both the appraiser and the client/AMC. It is perfectly reasonable for a client or an AMC to ask for proof of E&O insurance and ask to receive updated insurance information each year. That’s common to many professions, but there is no good reason to require that the information...

Statement of Frank Gregoire (NAR) Before Appraisal Oversight Hearing 3

Statement of Frank Gregoire (NAR) Before Appraisal Oversight Hearing

NAR believes that lenders should be prohibited from retaining the services of an AMC where the lender maintains any level of ownership. Frank Gregoire‘s written testimony to the United States House of Representatives Committee on Financial Services Subcommittee on Insurance, Housing and Community Opportunity before the Appraisal Oversight Hearing … APPRAISAL ISSUES AND CHALLENGES There are a myriad of circumstances and issues working to hinder the recovery of the nation’s housing market. Among them, and often overlooked, are those related to the credible valuation of real property. A credible valuation provided by a licensed or certified professional 1) ensures the...

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Mysterious “Notice of Claim”

This post is for appraisers who have received a document entitled “Notice of Claim — Appraiser” relating to lawsuits filed by the FDIC (see example below). We have received multiple reports from appraisers and defense counsel about the mysterious “Notice of Claim.” The notices are so far nearly identical and state that the FDIC has filed a lawsuit for damages against one of two AMCS (either CoreLogic-eAppraiseIT or LSI Appraisal) based on one or more of the recipient appraiser’s appraisals and that the appraiser may be the subject of claims for negligence by one of those AMCs or by another...

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