Tagged: AVMs

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...

Licensed Residential Appraiser Response to Appraiser Shortage 11

Licensed Residential Appraiser Response to Appraiser Shortage

Licensed Residential Appraiser out of work! I find it hard to believe that there is a shortage of appraisers when I, a Licensed Residential Appraiser, have only completed three (3) appraisal assignments for 2016. I am constantly denied approval by Banks and AMCs. I’ve been denied because I am Licensed. I’ve been denied because I am not Certified. I am not being denied work because I am incompetent or because I have not been USPAP compliant. Certainly not because I have been disciplined. FHA removed Licensed Residential Appraisers. Then Banks and AMCs were eager to follow. I do not see...

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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...

Valu+ Logo Powered by NDC 3

Valu+ Discounted for AppraisersBlogs Readers

NDC’s Appraiser Product is now Valu+ with exclusive 20% off for all Appraiser Blog Readers. Valu+ is a standalone valuation product under the NDC Brand. San Diego, CA: In the appraiser data market there has been one constant for many years, NDC. Until now NDC was both the name of the business and the research product supplying thousands of appraisers and real estate leaders with accurate public records data on over 130,000,000 parcels of land. NDC is evolving and growing rapidly and because of this growth we are excited to announce that the NDC research and valuation product will be known...

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...

Appraisal Bias Appraiser Pressure ~copyright AppraisersBlogs 9

Why All Appraisals are Always Wrong

Appraisal Bias & Appraiser Pressure: Why All Appraisals are Always Wrong Real estate markets cooled down in the fourth quarter of 2014, and despite historically low interest rates, refinance volumes dropped as well. The increasing pressure on lenders and real estate agents to maintain loan and sales volumes has brought about renewed interest in appraisal accuracy and increasing concern that residential real estate appraisals are inflated. A recent Wall Street Journal article asserts that “home appraisers are inflating the values of some properties they assess (appraise), often at the behest of loan officers and real estate agents, in what industry...

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CU and Appraiser Regulation

Whether you believe Fannie Mae’s comprehensive rollout of Collateral Underwriter will finally weed out the lazy form-fillers or it will end up euthanizing the aging residential leg of the profession once and for all, is not the subject of this article. There are plenty of blogs, articles, and seminars that are wrestling with the efficacy of CU and its long-term impact. To be sure, the profession has entered the new age of big data. Residential appraisers will need to navigate regression analysis, heat maps, trend lines, oblique aerial images, and especially how to tie it all together into something meaningful. From...

A Journal Piece of Appraiser Independence (Part 2): Appraisal Independence Violated 2

Appraiser Independence Violated

A Journal Piece of Appraiser Independence (Part 2): Appraisal Independence Violated History is an important reminder to us all of what went wrong and what went right. When history is known we tend to skip the mistakes we made. We can either choose the right path for the wrong reason, the right path for the ‘right’ reasons and, we can take the wrong path in a similar manner. The MARKET needs to take the right path for the ‘right’ reasons. In years of late 1998 and 1999 several ideas were brought forth to a Forum filled with Individual Appraisers carrying...

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