Tagged: Uniform Standards of Professional Appraisal Practice

Skewed Customary Fee Perceptions - Imagecredit Flickr - Quinn Dowbroski 14

Skewed “Customary” Fee Perceptions

I no longer care about “customary”. “Customary” in Dodd-Frank’s customary and reasonable is a negatively biased fee before state studies begin! We all know that the “C” part of C & R is supposed to represent the normal fee charged by most appraisers for similar work and conditions. Some AMC appraisers even know the “R” part is supposed to be an amount that is reasonable based upon ALL factors necessary for completion of the assignment in a USPAP compliant and professional manner. Unfortunately HVCC and the AMC havoc it wreaked has existed far too long for there to be a...

FHA vs USPAP - FHA vs USPAP - FHA requirements – Appraisers Caught in Catch 22 112

FHA Requirements vs USPAP

FHA Requirements vs USPAP – Appraisers Caught in Catch 22 Excerpt The new FHA Handbook will become effective on September 14, 2015. There has been much discussion of the implications of changing “should” to “must” in thousands of examples in the Handbook. As a Board member of the Arizona Association of Real Estate Appraisers as well as being on the FHA Roster, I have taken a good hard look at these requirements and then, it hit me as I was teaching the Uniform Standards of Professional Appraisal Practice (USPAP) which is the basis of appraisal standards for every appraiser in...

Report an Opinion of Value as a RANGE - Yes or No - Imagecredit Flick - brandbook.de 3

Report an Opinion of Value as a RANGE – Yes or No?

Can appraisers report an opinion of value as a range? Can that be done? The answer is both YES and NO, or as some like to say, “It Depends!” Here’s an interesting example of YES, involving two commercial properties in Miami Beach (yeah, I know, resi’s, but hang with me here!): Appraisals: Town-owned lots in West Palm Beach worth millions You will notice in the article that the value reported in the appraisals is stated as a RANGE by the appraisers. That is entirely acceptable when appraisals are done under the guidance of USPAP Standard 2. It makes sense to do it...

Celebrity, Public Trust & Confidentiality - Is Your Facebook Brag Violating USPAP? 8

Is Your Facebook Brag Violating USPAP?

Appraising celebrity homes and naming the names of said celebrities When is it acceptable to tell others about your assignments? Is it okay to tell someone that you just appraised a famous movie star’s home? It is human nature to share the weird, unique and exceptional with others. Recently there was a debate on a social media site about appraising celebrity homes and naming the names of said celebrities. We have all done something similar, sometimes in an open forum, sometimes between close colleagues.  We are all human and it is within our nature to share the oddities and unusual stuff we have the opportunity...

Appraiser-Client Relationship - Imagecredit Flickr - Dennis Hill 15

Don’t You Value our Relationship?

Relationships, we all have them.  And despite the efforts of Dodd Frank to destroy them, we have somehow managed to keep them. A big bank that I had a great relationship dropped me because their portal system decided there were too many appraisers last year and left me hanging. No orders for a year. Now they’re busy and want me to do appraisals. Great! But between the portal fees, underwriting charges, title surpluses, software charges, destination charges, taxes, etc. the fee works out to be substantially lower than most work I have. They asked me “don’t you value our relationship?”. I replied where...

The Appraisal Foundation Chocking The Appraisal Industry and Resisting Change - Imagecredit Flickr - Rafa Garces 23

The Appraisal Foundation Chocking The Appraisal Industry

The Appraisal Foundation Resisting Change The Appraisal Foundation sent out a correspondence stating the Appraisal Institute is undermining their authority. This was very one sided and off the mark. Everything changes. The appraisal business is changing. AI is staying on the fore front of this change. The Appraisal Foundation is resisting change. The Appraisal Foundation policies are chocking the appraisal industry. It is next to impossible to bring on new people. As a result the number of appraisers across the country in 2007 were 120,000 +/-. Today its about 70,000. The industry is changing and so must the policies. AI does not want to go back...

Residential Appraisers Dos and Don'ts - Imagecredit Flickr - Quinn Dombrowski 7

Residential Appraisers Dos and Don’ts

Residential appraisers are a critical piece in the puzzle that is determining a property’s “true” value. But in today’s market, the role they play is more pivotal than ever. When every dollar counts (as the players of the game may still be licking their wounds from the oh too recent housing crisis) sellers want to be able to get the highest value possible for their property and buyers certainly do not want to overpay for a home, so working with an appraiser who is trained to perform services in an ethical and professional manner with rich knowledge of the market...

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Unpermitted Additions “Zombie” Assignment Condition

Unpermitted Additions This is a “zombie” assignment condition that seems to never die. Let’s agree that unpermitted means something was constructed without a required written permit. There are plenty of jurisdictions that don’t issue permits because the permit process doesn’t exist. The assignment condition goes something like this: The appraiser is not to include any GLA from any unpermitted additions unless they use comparables that have similar unpermitted additions. Here’s what Fannie Mae stated in their September 2014 FAQs: If the subject property features an unpermitted addition, can the square footage of the unpermitted addition be included in the total gross living area reported on the appraisal report? If the appraiser has identified an addition(s) that does...

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Blacklisting Lawsuit Continues

Appraiser Michael J. McSwain filed a lawsuit against Yadkin Valley Bank and the appraisal management company (AMC) StreetLinks Lender Solutions, alleging that he was retaliated against for failing to reach targeted values.

According to the suit, McSwain performed two appraisals for StreetLinks in late 2012, on behalf of Yadkin Valley Bank, both of which failed to “meet value.” The suit cites explicit emails from the branch manager at Yadkin which state:

“StreetLinks has sent out a BUTCHER on two of my last refis [sic] … make sure he is not sent out in our county and make sure he is not on the approval list…I thought I would let him do these two just to see. NOW THE DEALS ARE DEAD.”

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The Dilemma of Indemnity Agreements – What Should an Appraiser Do?

Burdensome indemnity language required by a lender or AMC Appraisers are often required to sign lengthy contracts to obtain assignments from lenders or Appraisal Management Companies. These contracts outline the scope of work, when the assignment is due, how to transmit reports and other items that require review and understanding. Once the contract is formalized, the appraiser is then legally required to comply with its’ provisions. One important and often troublesome requirement is the Indemnity Provision. The concept of indemnity means “security against hurt, loss or damage”. Through indemnity, one party can shift the responsibility of loss to another party...

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