Disciplinary Cases Against Hybrid Appraisers

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VaCAP Board
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State Appraisal Board Disciplinary Cases Against Hybrid AppraisersRumor has it there are several Virginia Real Estate State Appraisal Board disciplinary cases against appraisers revolving around hybrid appraisals…

Some are for and some are opposed. It is a business decision on which types of assignments you choose to accept.

If you choose to complete a hybrid or bifurcated appraisal, you need to pay attention and ask yourself a few questions.

  1. Is the fee I am receiving for completing this assignment reasonable for the scope of work I must perform? Notice the term customary was not used as these products are new and there is no customary fee YET. But if you accept them at a fee not in line with your time, experience and risk, there soon will be a customary fee.
  2. Are my actions a risk to my license and livelihood?
  3. If I cut corners to compensate for a non reasonable fee, what are the consequences if I have a complaint filed against me with the Virginia Real Estate Appraiser Board?
  4. Remember back in December, the Georgia Real Estate Appraiser Board found an appraiser guilty of 23 state and USPAP violations revolving around a hybrid appraisal. Want to know what your board members will do here in Virginia? That is simple; attend the Virginia Real Estate Appraisal Board Meeting on Tuesday February 11th at 10:00 AM to find out.

Rumor has it there are several disciplinary cases against appraisers revolving around hybrid appraisals. The Virginia Real Estate Appraisal Board Meeting is open to the public and there will be a public comment period for anyone who wishes to address the Board. Come see first hand the outcome of these cases.

See the meeting information and agenda on Town Hall

Image credit flickr - Metro Centric
VaCAP Board

VaCAP Board

Coalition of individual appraisers working together to unite, promote and protect the collective interests of all appraisal professionals in Virginia; to promote needed changes in laws, rules, regulations, policies and standards affecting all appraisers in Virginia; to observe and report the actions of regulatory, legislative, oversight, and standards-setting entities of the Commonwealth.

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12 Responses

  1. Stephanie Foster on Facebook Stephanie Foster on Facebook says:

    Here in NC as well

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  2. Jamie Humphrey on Facebook Jamie Humphrey on Facebook says:

    No surprise there!

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  3. Avatar Koma says:

    They just need a signature, any appraisers signature that’s it. Good luck with the aftermath when these types of reports go down because your the only one with the most liability. I personally will not perform these types of “reports” which are relying on some unknown persons providing their opinion of condition from a property observation. Again, Good Luck!

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  4. Avatar kdgarth says:

    To say it again: FAKE NEWs that: “appraisers are the reason”

    REAL NEWs: the lender charges the Fee to the borrower. Say: $600. The Lender uses an AMC who retains @half (around here) & delay IS due to the low Fees trying to locate “any” appraiser willing …which can take DAYS off of the Due Date.

    Where a FAIR FEE is quoted to the appraiser (which around here CAN be less than what the borrower was charged): the appraiser is bound to DUE DATES typically 48 hours or 5-7 days.

    SO it is the lender & the AMC that is ruining the process.

    I will quit before I do any of these type Products.

    **I will never sign (my reputation & liability) for “the examples for the “B” side of the Hybrid I have been given to quote.

    **How in the h*@! the lender was even “able” to order a Hybrid for these Subjects is beyond crazy.

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  5. Avatar ej says:

    When are these AMCs and Lenders going to be held accountable for promulgating these trash products?

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  6. Avatar Cotton says:

    If there is ever a time to speak up now is the time. Garbage players in our industry continue to push lies and deception to sell their flawed and scamming hybrid products. Every appraiser is fully aware that bifurcation reports are just a money making scam. The collateral director at Fannie Mae Lyle Radke needs to step down from his position and go back to reviewing BPOs. Clearly this clown is pushing this agenda at trade shows and corporate meetings. Fanne Mae is an end user and is not the voice of the appraisal profession. Only a fool would would consider completing this bifurcation crap. Where is the government? Why is the government allowing the consumer, investors, tax payer and appraisers to be taken advantage of?

    11
  7. Avatar chris says:

    I just received an email to do these today, They didn’t quote a fee but suggested $100/hr….lol….No thanks !!! I copied and pasted your article to the email response.

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  8. EJ – and others. The answer is “soon”. In order for a lender to be held accountable, we have to first ‘prove’ that the product they allowed to be delivered to them via their agent AMC failed to comply with USPAP. That process starts with the individual appraiser.

    I’m told that one of the currently pending cases in Virginia is one that AGA filed on behalf of its Virginia members.

    An initial review appraisal of the bifurcated hybrid by an appraiser retained by DPOR identified up to ten (10) separate potential violations of USPAP. When the appraiser met with another representative of DPOR at the Informal Fact-Finding meeting (The IFF), the total violations were inexplicably ‘reduced’ to five (5), with two (2) being deemed particularly severe. Though I’m not sure what is meant by particularly severe versus simply non-compliant in a report that claims to be USPAP compliant.

    I’m further told that the IFF recommendation is to be a nominal fine for each ‘chargeable’ offense.. The IFF was unaware the appraiser was reportedly already on probation for prior offenses. To assure impartiality DPOR does not let investigators or fact-finders know about prior offenses. In one sense that is understandable. That practice makes it all the more critical that the full Board considers both the IFF AND the appraiser history; and not simply some form of reduced charge settlement.

    That specific complaint also included a complaint against the lender and their AMC agent as well as the non-appraiser property inspector. Perhaps those are being addressed separately. We simply don’t know at this stage.

    The DPOR ‘Board’ will meet to decide the merits and outcomes of the complaint on 02/11/2020. We consider the outcome to be far more important than whether one appraiser is found to be at fault for a deficient report that is touted as being “USPAP Compliant”.

    It is critical to identify inherent systemic flaws in these products so that lenders and AMCs promoting them will be forced to change them. (1) Either actually make them USPAP compliant, or (2) stop advertising them as USPAP compliant appraisal reports; or (3) do away with the flawed and arguably fraudulent process completely.

    I’m also told REVAA is actively working behind the scenes to influence (minimize) the impact. That, unfortunately, is only an unverified rumor or hearsay at this point. Though from sources deemed to be particularly well informed.

    DPOR has a particularly heavy burden in this case. We hope and trust that they will not downplay the significance of the issues at stake through some form of ‘face-saving’ settlement that allows the AMC or lender to sidestep their own culpability in this specific case.

    Culpability that may result in separate follow up complaints to federal regulators if DPOR finds against the appraiser.

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  9. Eric Kessin on Facebook Eric Kessin on Facebook says:

    Disciplinary case? Instead of wrecking somebody’s livelihood, how about just sending a letter to every licensed appraiser stating they will be disciplined if they perform them? This is pretty outrageous.

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    • Every licensed appraiser is required by law to know USPAP. ALL should be able to review the typical scope of work and understand WHY they should not do these, or at least understand the extra hours of work necessary to make these products comply with USPAP (assuming the online format limitations permit that).

      The only thing outrageous here is that any real appraiser would think they need or deserve a special invitation not to participate in loan fraud!

      As for “wrecking someone’s livelihood” the rest of us have to try to continually explain why lenders special less than appraisal products cannot be done, or should not be done by people who violate USPAP and wreck OUR livelihood. We are expected to set our fees to compete with these less than USPAP compliant products.

      Outrageous? Either perform appraisals according to USPAP or get the hell out of the business!

      5
  10. JJ Suzanne on Facebook JJ Suzanne on Facebook says:

    Interesting link.

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    • The devil is always in the details. CAN an appraiser do these? That’s not the same as asking “Are the majority of online systems and formats conducive to producing USPAP compliant appraisal reports.”

      IF (as in all hybrids) reliance is placed on the inspection of a third party then the appraiser is accepting responsibility for the validity of that third party inspection. IF as almost all of these reports cite in verbiage from those 3rd party inspectors, that no reliance for appraisal purposes is intended then why are they merged with the appraisers’ analysis and used as a basis for it?

      Watch John twist himself into a pretzel trying to justify the half-assed practices currently in use. HE is technically correct in what he says. Yet that is NOT what the hybrids verbiage state.

      4

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Disciplinary Cases Against Hybrid Appraisers

by VaCAP Board time to read: 1 min
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