TRID – Possible Changes by CFPB

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Dave Towne

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Hard Fixed Appraisal Fee in TRID - Possible Changes by CFPB

For appraisers and lenders, a key sticking point is the ‘appraisal fee’ has been hard-fixed, quoted up front, and difficult to change, at the time the assignment is given to the appraiser…

Appraisers / Lenders, the Bureau of Consumer Financial Protection (CFPB) has opened a comment period soliciting written comments on the current TILA-RESPA Integrated Disclosure (TRID) process applying to consumer mortgage loans.

Comments can be submitted to the following addresses, until Jan. 21, 2020. You may submit comments, identified by Docket No. CFPB-2019-0055, by any of the following methods:

  • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
  • Email: 2019-RFI-TRID@cfpb.gov. Include Docket No. CFPB-2019-0055 in the subject line of the email.
  • Mail/Hand Delivery/Courier: Comment Intake – TRID Assessment, Consumer Financial Protection Bureau, 1700 G Street, NW, Washington, DC 20552

Read more in this PDF accessed here.

For appraisers and lenders, a key sticking point is the ‘appraisal fee’ has been hard-fixed, quoted up front, and difficult to change, at the time the assignment is given to the appraiser. Once the appraiser gets to the property, other characteristics or issues (typically unknown in advance) can arise which may cause the appraiser to believe a fee increase is necessary to compensate the additional time spent during report preparation. This causes a lot of heartburn with lenders, because the TRID mortgage application procedure has to start over, delaying the lending process.

But there are legitimate reasons why the appraisal fee needs to be uncoupled from the other hard-fixed fees.

Also, in TRID, there is no mandated instruction saying the appraisal fee must be shown separately from any other ‘management fee’ associated with the assignment, i.e. AMC processing fee, etc.

Any fees applying to the appraisal should be itemized so that the consumer has full understanding of what they are paying for.

If you agree with these points, or have other comments, send your written items to the CFPB per one of the methods above.

Image credit flickr - Matt Wiebe
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on e-AppraisersDirectory.com

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19 Responses

  1. Avatar Bill Johnson says:

    Even if, and that is a big if, when lenders do their part to determine the subjects single data points (GLA, Lot, Location, etc.), its means nothing until a second set of data points is gathered (neighborhood info) to see how the subject fits into the neighborhood. The closer the subject is to the median for the area (average/typical), traditionally the closer the appraisal fee is to a local standard, however the further away from typical (big, small, etc.), the further away the appraisal fee becomes (+++$$$).

    The idea that a $600, $800, $1,000+ appraisal fee should be the same as a $40 credit report (zero tolerance item), is a complete joke.

    Seek the truth.

    4
  2. Never had an issue getting a fee increase if merited.

    2
    • Avatar Bill Johnson says:

      Then you don’t work in San Diego County Woody. Even if 90% of the appraisers in my county agreed with me concerning complexity and fee, there are still +/-100 appraisers in the county for the lender to use. It most often has nothing to do with the sentence, paragraph, or book you write to the lender concerning complexity, but rather its easier for them to keep shopping for a yes appraiser then it is rewrite the paperwork and have a 3 day additional delay.

      Seek the truth they don’t.

      5
  3. Avatar SB says:

    Not holding my breath. Law enforcement activity at the CFPB has dropped precipitously under the Trump Administration’s leadership.

    Ask any AMC Appraisal Manager what TRID stands for and you will get crickets…

    More concerned about getting my invoices paid in a timely manner.

    This was the response I got today when inquired about an overdue invoice:

    “Sorry for the delay and inconvenience. Due to appraisal volume, our check schedule is currently at 60 days from invoice date. I will let you know when the next round gets sent out”

    CHECK IS DELAYED DUE TO APPRAISAL VOLUME???????? WTF does that mean?

    THE 10 YEAR CLOWN SHOW CONTINUES

    6
    • Avatar Bill Johnson says:

      I hear you SB. I just cleared up a 5 month old VA invoice where it was dead end after dead end. On a side note, also VA related, I received a new order from a new client where they want to pay me via direct deposit, but get this, the agreement they want me to sign in part says the following.

      …”I authorize CBC National Bank to make withdraws from this account (my account) in the even that a credit entry is made in error.

      How long before their data gets hacked and someone finds the open door to my bank account?

      ….I agree not to hold CBC National Bank responsible for any delay or loss of funds due to incorrect or incomplete information…..”

      Really, CBC National Bank, how often is the delay in payment from the appraisers end versus the lender?

      Of note, the VA regional office has not responded to my concerns regarding this direct deposit agreement, nor has the client responded to me demanding a paper check. This will be fun in the coming months.

      Seek the truth.

      6
      • Avatar Dave Towne says:

        The safest way to handle ACH payments (electronic deposits) is to establish a secondary checking account (maybe at a Credit Union). Have all ACH fee payments deposited to that account. Then when notified that a payment has been made, do an electronic funds transfer out of that account to your primary business account. That way, if the Payer decides to claim funds, there won’t be any to obtain.

        4
        • Avatar Bill Johnson says:

          Thanks Dave, I get it but I add the following.

          Last year I had 50+ unique VA clients where each and every one of them paid by traditional check, so is it me, or is it them?

          It seems like our clients are going out of there way to make themselves unusual (their own software, mobile apps, pre-scheduling, etc.), but as a business who happens to do appraisals, all of that has to get filtered out when you convert everything into YOUR business model.

          Seek the truth.

          3
    • Baggins Baggins says:

      Has the current president been in office that long already? Fake news does terrible things to the mind. If you want to point a finger regarding the CFPB point it at Elizabeth Warren, she was running that thing before Trump was even on the radar. Please.

      When the majority of all legislation is written by the lawyers whom are employed by the same corporations supposedly being regulated. You are watching political theater.

      Did you know Trump has rescinded congresses lifetime retirement, is forcing them to participate in the same taxation and healthcare systems they impose upon us, and has reduced the influence of paid for lobbyists? The things the corporate owned media does not want to talk about. These days there managing boards of all major syndicated news networks have corporate heads sitting on those boards and they do control content and criticism. The term “Clown Show” in this current cycle was brought forth by Mark Dice and Infowars.

      Better luck next time, keep trying. Ha!

      2
      • Baggins Baggins says:

        Dave hit me with a fact check on the above statements.

        Looks like the radio guys are a little ahead of it and my presumptions are not entirely correct and factual. However, something is there.

        https://federalnewsnetwork.com/budget/2019/03/familiar-cuts-to-federal-retirement-health-benefits-are-back-in-trumps-proposed-2020-budget/

        https://www.fedsmith.com/2019/02/12/senate-bill-eliminate-congressional-pensions/
        re; https://www.cbo.gov/publication/55733
        https://www.govtrack.us/congress/bills/116/s439

        The actual fiscal impact remains clouded because of how they tally and recognize the figures. Regardless, the bill follows the original intent of the founders, that statesmen should serve in public office, and eventually go back to the private sector. This is a disincentive bill aimed towards career politicians. “End plush retirements act” Looks like it’s moving forward.

        Which appears to be a continuation of something similar from 2017. Looks like that one stalled out.
        https://www.congress.gov/bill/115th-congress/house-bill/1935/all-actions?overview=closed#tabs

        Not to be confused with this viral fake story below which is not what I was talking about.
        https://www.politifact.com/facebook-fact-checks/statements/2019/oct/25/viral-image/no-trump-isnt-asking-you-forward-email-about-trump/
        https://www.truthorfiction.com/trump-rule-congressional-reform-act/

        Back to work.

        2
      • Avatar SB says:

        Actually have never watched Infowars.

        1
      • Avatar Realrose says:

        I am pretty sick and tired of your nasty, faux news interpretations of how politics is affecting our business. Let me clear up something for you about the CFPB. Elizabeth Warren was the creator of this Federal agency; it was created to protect consumers. When congress created it, it was suggested that she head up the new agency. Of course, the males, who always outnumber the females (and men who support women in government), mostly republican, couldn’t stand her, so they had to change the first head of CFPB to be headed by a man. I don’t support her for president now, but with jerks like you interpreting things through your brainwashed fox news opinions, you make me want to puke every time I read your new spin on fake news. Here’s some truth: trump is impeached because he lies, he breaks laws and tradition, and has no coherent plan to keep us safe from terrorism, or financial crimes, and he is trying to cover-up for his crimes against our country, and those include tons of financial crimes. He is the most crooked politician ever to govern our country, and because you still support him, I can’t rationally believe one thing you say. I like participating in this blog, but you are the reason I won’t join, so from now on, I will pass on reading anything you say here, and remember, you are not the authority here, Mike is!

        0
        • Baggins Baggins says:

          To literally believe that is the only valid interpretation of the matter and feel that way about half of all Americans, it is a nihilistic attitude and it must be exhausting.

          If only it was as easy as blaming one man. That is called myopic.

          Thank you for volunteering to participate less.

          4
        • Avatar Bill Johnson says:

          Go for a drive Realrose, a long drive through every single county in the United states. When done, report back to us relating to political preference per county. Or just pull up a county specific map from the last election where I hope your favorite color is red. Not picking a side nor a fight, but there’s more out there than what gets depicted in the big cities.

          A few side notes Realrose. If the CFPB was created to protect consumers, then why are consumers paying $600 to $1,000+ for an appraisal (10’s of millions of times), when after the AMC split (say 50% stolen from the appraiser), the true cost is often half of what the consumer is being told?

          If the president has as you say committed financial crimes, covered up crimes against our county, financial crimes, etc., then why the hold up from the left in sending it to the senate?

          Seek the truth.

          8
          • Baggins Baggins says:

            CFPB allowed the C&R safe harbor rule which basically nullified the 40 thousand letters appraisers generated to fight back against the hvcc and ensuing after effects. CFPB is responsible for the amc model as we know it today.

            I think the three legged stool just fell over. hat was the analogy of the cfpb’s justification in the first place, the additional leg for regulatory stability.

            A serious analysis in the role of media perpetuating propaganda. Really a worthwhile watch. Rick Sanchez. It’s a problem not limited to one side of the isle or another.

            “There is a board member representing all major corporations on every single major media management board. That is why some stories do not get mentioned and so many others are clearly distorted.” Something like that.

            Ruskie fever is alive and well for those whom have a hard time dealing with transitions of power back to the people in this country. To state that financial crimes are limited to one party or another is also a statement which speaks for itself.

            “Rent free, in your mind.” Talking to millennials and the elderly today about safe spaces.

            3
            • Avatar marion says:

              It is really sad when people younger than me, can’t remember the history they already lived.

              1. CFPB was E.Warren’s concept when there was a Warren Commission investigating banks. It is something the Obama Administration wanted in the Dodd Frank financial reform and put there.
              2. Richard Cordroy was the first ever chairman of the CFPB. Obama wanted Warren, but Congress voted for Cordroy.
              3. The C&R safe Harbor Rule was put into the interim Final Rule by the Fed Board, not by one political party or another.
              4. It was Cordroy who decided the IVPI, where appraisers could report violations of independence, should be converted to a site for everyone else to report appraisers for anything they felt like.
              5. It was just before the release of UAD that all the money that had been sent to the CFPB to open the IVPI disappeared. Short news byline, never revisited.
              6. Prior to the UAD, appraisers needed “experience” to produce a “different” report per USPAP. With UAD, the “experience” requirement disappeared from USPAP, now all you need is “education” to do new things.
              7. None of this is divided along political party lines as both parties have taken part in the demise of consumer protections.

              2
              • Baggins Baggins says:

                Nice Marion. I was unaware of point #5.

                Pg 55 and beyond in the below link. The term institutional memory comes to mind. I found that with this search; “ivpi”, “cfpb”, “funding”

                Contrasting the efforts of today, nothing is being done and the dream of industry corrections died sometime circa 2012 and the few years after. What was previously identified as objectionable activity is now just standard daily expectation.

                Independence, who needs it? Accountability, not while lenders are in control. Self asking regulation to create a monopolistic business structure, BUY BUY BUY! Virtually nothing has been accomplished to rectify the absurd pressures hoisted on appraisers. For a brief few years there was relief, until unregulated amc’s learned how to game the system with unlicensed individuals. Regulating them as a company merely served to legitimize their profiteering and fraudulent business activities. In retrospect we now know why the IVPI was killed. What replaced it was a behemoth billion dollar a year appraisal management business set which enjoys virtually no accountability and freely violates rules such as junk fee, unearned fee, kickbacks, cherry picking, open blacklisting, greed, malfeasance, the list goes on. And to this day, appraisers still skip along on that broken record, vainly justifying to themselves and their ‘peers’ why working with amc’s is somehow acceptable and ethical, then they cry rivers of tears when the trust is betrayed. The blind leading the stupid. I listened to Warrens several hour long interview or explanation on the cfpb creation back then. It was inspirational and motivational. I recall the memory because it correlated with subsequent disappointment, empty promises and flip flopping to appease corporations. The third leg never materialized. Politics, go figure.

                https://www.govinfo.gov/content/pkg/CHRG-112hhrg76111/pdf/CHRG-112hhrg76111.pdf

                I see SB posted a joker picture above. (whips out journal handbook, pauses) Knock Knock….

                0
  4. Retired Appraiser Retired Appraiser says:

    If you are sick of holding your breath and waiting for an improvement in this dead end career there is hope (just not for appraisers).

    Adobe is running a 40% off sale on their entire software collection this week: $360 leases all 20 applications for a year. Make a career change your New Year’s resolution guys.

    4
    • Baggins Baggins says:

      Naaa, with liquidity failing and the fed running another round of QE which is of course as they promise, not another round of QE, I’ve been seeing an uptick in reo activity. REO is so easy, it hardly ever blows back and for me at least, run those out half asleep in pajamas.

      Do you think the industry heads would listen if appraisers asked for proper separation of appraisal vs non appraisal ancillary fees? I’ll flip a letter over soon but it’s doubtful. The fees are purposefully improperly co mingled as big box lenders purposefully seek to erode checks and balances, automate away independence, and gain complete control over any possible consumer objection.

      TRID and appraisal fees was a very clever way of circumventing acknowledgement an obvious fraud where fee raking became virtually legal overnight. It’s the lack of direct billing which is the problem. Back in the day an individually licensed mb would engage an individually licensed appraiser. Appraisal service fees were paid entirely to the appraiser themselves and any increase of cost or discount of cost was passed directly to that individual consumer. There was ethics and accountability in billing between licensed individuals. The good old days before when defrauding appraisers and homeowners alike was legal and encouraged.

      Nobody without an appraisers license is qualified to manage an appraiser panel. Nor should they be allowed to influence appraiser billing structures. Because they are not licensed, there is no accountability possible when junk fee billing becomes prevalent on an industry wide scale as it is now. An individual sole proprietor has no chance of every seeking justice for consumers if they have to face down a billion dollar middle management industry to get there. Pre disclosing of fees or not pre disclosing of fees is a distraction from the actual problems.

      2
  5. Avatar Anonymous says:

    borrowers can not, by Federal law, pay appraisers.

    it does not matter what a borrower pays in closing costs because the lender is responsible for paying the appraiser.

    It does not matter if a borrower is paying an appraiser, through a 3rd party.

    The borrower can not pay the appriaser.

    Lenders are responsible for paying the appraiser.

    Lenders and their loan agents are responsible for quoting the correct EXPENSE of the LENDER for the costs of the appraisal.

    NONE of the TRID has anything to do with the appraiser’s fee because, LENDERS ARE RESPONSIBLE FOR THE APPRAISERS FEE.

    Stop drinking Kool Aid.

    2

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TRID – Possible Changes by CFPB

by Dave Towne time to read: 1 min