Tagged: automated valuation model

5

Simply too BIG to Say No to…

If they can’t even get their own PACE Pro form right, how are these alternative “valuation” providers going to get something as complicated as the value right? First American, and to some extent similar large scale conglomerate “players”, supply everything to the transaction: from the Home Warranty for the buyer, to the escrow services, to the mortgage company, to the mortgage servicer, to the title company, to the appraisal management company, to the appraiser panelists, to the software company that DESIGNS the software used for PACE Pro and almost all other appraisal software (ACI), to the BPO providers, to the...

AVMs can Never replace Appraisals 34

AVMs Can NEVER Replace Appraisals

AVMs Can NEVER Replace Appraisals & why FNMAs vaunted CU AVM is flawed! Yesterday (March 15, 2016), an appraiser called me to discuss a complex assignment he had. One of his comparable sales was reported in MLS as having sold for $3,469, 898. It was in range with his other comparable sales for his subject property. It was the most similar comparable property. When he went to verify the sale price with our Los Angeles, California subscription-equivalent to “public records” he discovered a shocking discrepancy he couldn’t explain. RealQuest (CoreLogic) showed the full value sale price as $17,665,455! So what...

16

Collateral Underwriter, What’s Under the Hood?

Collateral Underwriter – Garbage In, Garbage Out (GIGO) FNMA has a fascination for first patenting garbage, & then implementing it as policy! FNMA simply LIED! Collateral Underwriter IS an automated ‘appraisal review’ despite disclaimers. It was never intended as anything else. Read the patent application below. Before I get into the details, I want to ask each reader to forward this to every appraiser you know. This concerns FNMA’s patent of the seriously flawed techniques and underlying support for their Collateral Underwriter (CU) Risk Rating “System”. It’s time for appraisers to take action against the unreliable system which is unfairly...

Computer Generated Value vs Human Brain 1

Computer Generated Value vs Human Brain

Around 1992, representatives of LSI (long before they became completely useless as an AMC) visited us in California to discuss some way to involve automation (as in AVMs) to eliminate appraisals. When I pointed out that they had JUST THANKED me for saving them from a quarter of a million dollars over valuation as a result of pressure from one of their very influential customers, and that the very same issue had arisen from that customers misapplication of data AND their potential misinterpretation of that data, they understood the connection. A KNOWLEDGEABLE human appraiser was required to resolve the difference....

Chief appraiser says AVM is an appraisal 14

Chief Appraiser says AVM is an appraisal

Appraisers, Maybe I’m too much of an anal retentive type person, or perhaps it’s because I believe it’s important to use correct terminology. Regardless, I’m very concerned when someone with Chief Appraiser attached to their name attributes an AVM electronic value statement to an actual appraisal opinion produced by a human. So where did this rant come from, you ask? Future of Valuations Marries Automation and Human Instinct Within the article is this statement by the writer: “While AVMs do hold value — they are a cost-effective, fast tool to produce appraisals — the popularity of AVM usage among home...

Bank profits - Get rid of appraisers 11

Bank Profits: Eliminate Appraisers

Zestimate Gone Wrong. It all comes down to money and profits…

Once again the Zestimate has a home-owner up in arms. In a small town in North Carolina a home just sold for $20,000. It was listed at $55,000, then reduced to $45,000, and finally sold in 2015 for $20,000. Safe to say it needed a little TLC.

It was a shell in need of, well everything. But, we have to remember that automated valuation services don’t know anything about condition or circumstances. Before the house was listed for sale, the owner (from a different state) thought they had inherited a nice little nest egg. Not a fortune, but if it was close to the Zestimate, they would have quite a nice amount to play with…

Bottled water and Automated Valuation Model (AVM) - Lie 4

Bottled Water and AVM – Sold on a Lie

How about bottled water? Advertising is a powerful tool and very smart people will do some very dumb things, if they are properly motivated. There are many examples of how advertising creates an illusion and how we all fall victim (at least for a while) to smooth ad campaigns. One great example is automobile insurance rates. “Switch and Save. Every insurance company ran ads promising savings over their competition. Well, of course, they all can’t be true, but for over a year there was a massive switch in policies by consumers. The ads worked. How about bottled water? News shows...

7

It’s Not a Comp, It’s a Sale; Stop Fannie Mae Lies!

It is merely a SALE… Appraisers, Something’s been gnawing at my craw ever since January when FNMA’s wonderful Collateral Underwriter (CU) was unleashed to the world. And before that, when FNMA’s Appraiser Quality Monitoring (AQM) process was introduced to judge the work of appraisers. No one else has written about this. No one has even mentioned it. So I will:  It has to do with the word “Comp” which is used liberally by Fannie Mae (FNMA). What exactly is a “Comp?” In FNMA’s world, it’s any property that they obtain, either by their vast AVM process which examines millions of...

HUD blacklisting - guilty until proven innocent 2

HUD Blacklisting: Guilty Until Proven Innocent

HUD has been quietly blacklisting appraisers for years without due process Being on HUD’s FHA Appraiser Panel and performing FHA appraisals is an essential source of work for many appraisers. However, according to a recent legal brief filed by the National Association of Appraisers (NAA), HUD has been quietly blacklisting appraisers for years without due process. At the center of the case against HUD (U.S. Department of Housing and Urban Development) is Ken Taggart, an appraiser in Penn., who was removed from HUD’s roster in January 2010. Taggart says that his mortgage servicer, GMAC Mortgage, LLC, mistakenly forclosed on his...

Fannie Mae re-evaluate appraisers adjustments 1

Fannie Re-Evaluating Your Adjustments & VA Hiring Appraisers

Fannie Mae’s Murphy stated that over the past year, the GSE had been focusing on “quality” and “condition” ratings of comps used in multiple appraisals by the same appraiser and found many cases where the appraiser has changed the quality and/or condition ratings on the same comparable from appraisal to appraisal. Now, based on the examination of the Uniform Appraisal Dataset (UAD) data, Fannie Mae’s focus for the next 12 months will be on adjustments. The data indicates that many appraisers are not using…

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