The Possibly Just Became Reality!

AppraisersBlogs

AppraisersBlogs

AppraisersBlogs Team at AppraisersBlogs
Have questions or need help? Please contact us with any comments, questions or concerns.
AppraisersBlogs

Latest posts by AppraisersBlogs (see all)

Using SmartExchange? You May Have Violated State Law & USPAP

Using SmartExchange? You May Have Violated State Law & USPAP

I will not drag this out. I will simply be direct and to the point.

IF YOU OPTED IN TO ALAMODE’S SMART EXCHANGE, YOU MAY HAVE JUST VIOLATED STATE LAW AND USPAP ON EVERY APPRAISAL YOU HAVE EVER COMPLETED.

Let me repeat that so it sinks in a bit… If you opted in to alamode’s Smart Exchange, you may have violated State Law and USPAP on every appraisal you have ever completed.

Now that it has sunk in, let me explain. Each state statute may define an appraisal differently. Some definitions relate strictly to a monetary value, while others are more generic and refer to an analysis, opinion or conclusion. If your state has a different definition of an appraisal than what is defined in USPAP, you may have a very serious issue on your hand. See some of the different definitions of an appraisal from random states.

North Carolina: § 93E-1-4. Definitions.
“When used in this Chapter, unless the context otherwise requires, the term:

(1) “Appraisal” or “real estate appraisal” means an analysis, opinion, or conclusion as to the value of identified real estate or specified interests therein performed for compensation or other valuable consideration”

Maryland: §16–101.

(a) In this title the following words have the meanings indicated.

(b) (1) “Appraisal” means an analysis, conclusion, or opinion about the nature, quality, utility, or value of interests in or aspects of identified real estate.

(2) “Appraisal” includes:

(i)  a valuation appraisal;
(ii)  an analysis assignment; and
(iii) a review assignment.


West Virginia: §30-38-3.Definitions.
“As used in this article, the following terms have the following meanings:

(a) “Appraisal” means an analysis, opinion or conclusion prepared by a real estate appraiser relating to the nature, quality, value or utility of specified interests in, or aspects of, identified real estate or identified real property. An appraisal may be classified by the nature of the assignment as a valuation appraisal, an analysis assignment or a review assignment.”

Kentucky:324A.010 Definitions for KRS 324A.010 to 324A.090.
“As used in KRS 324A.010 to 324A.090, unless the context requires otherwise:

(1) “Appraisal” means an oral, written, or electronic communication of any type or nature which is independently and impartially prepared by a licensed or certified appraiser setting forth an analysis, opinion, or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate, as of a specified date, for or in expectation of compensation;”

Utah: 61-2g-102. Definitions.

“(1) As used in this chapter:

(a) (i) “Appraisal” means an analysis, opinion, or conclusion relating to the nature, quality, value, or utility of a specified interest in, or aspect of, identified real estate or identified real property.
(ii) An appraisal is classified by the nature of the assignment as a valuation appraisal, an analysis assignment, or a review assignment in accordance with the following definitions:

(A) “Analysis assignment” means an unbiased analysis, opinion, or conclusion that relates to the nature, quality, or utility of identified real estate or identified real property.
(B) “Review assignment” means an unbiased analysis, opinion, or conclusion that forms an opinion as to the adequacy and appropriateness of a valuation appraisal or an analysis assignment.
(C) “Valuation appraisal” means an unbiased analysis, opinion, or conclusion that estimates the value of an identified parcel of real estate or identified real property at a particular point in time”

Virginia: § 54.1-2009. Definitions.

“As used in this chapter, unless the context clearly indicates otherwise:

“Appraisal” means an analysis, opinion, or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate or identified real property. An appraisal may be classified by subject matter into either a valuation or analysis. A “valuation” is an estimate of the value of real estate or real property. An “analysis” is a study of real estate or real property other than estimating value. The term “appraiser” or “appraisal” may be used only by a person licensed or certified by the Board.”

Now think about this. When using a sale as a comparable, you are analyzing the information you have from MLS, tax records, agents, etc. You are forming an opinion and concluding the quality, condition and utility ratings of these properties. This, by definition, could be an appraisal in your state.

Now consider this: The Ethics Rule of USPAP requires confidentiality. When you opt in to Smart Exchange, you have given your analysis, opinions and conclusions to everyone who is also opted in to Smart Exchange.

Have you violated both State Law and USPAP?

By Advocate, Certified Real Estate Appraiser – author requested to remain anonymous

Image credit flickr - Eric Fischer
AppraisersBlogs

AppraisersBlogs

Have questions or need help? Please contact us with any comments, questions or concerns.

You may also like...

30 Responses

  1. chris says:

    I think at best, the appraiser should note in the body of the report, who supplied him/her with the comp info.

    Hey why not right? save time on the grid and you don’t have to click through 50-10 pics of the comps.

    What appraiser would trust the data of another without verifying everything ?

    No one I hope, for a dollar a comp, I will do it myself ! Do the math !!!

    8

    0
    • Milton P says:

      The problem is you do not know who provided the information. I don’t see this as a time saver since we have to research and verify everything anyway.

      If the author is correct, and it does seem logical, if anyone gets a complaint to their board, it will roll down hill very quickly.

      8

      0
      • Baggins Baggins says:

        What if…. The appraiser used data entry services, used an inspection runner, had non licensed help tying it all up at the office, or perhaps the data even came from a hybrid report and they used those 5.25c per inspection people?

        Anyways, please use our supportive services to save time and money so you can get back to doing what you really love, appraising. What’s your fee and turn time?

        6

        0
  2. Kathy Hubbard Bright on Facebook Kathy Hubbard Bright on Facebook says:

    Alamode suckers subscribers into using Smart Exchange so smoothly with their format. SMMFH!

    8

    0
  3. Shawn Vanderhart on Facebook Shawn Vanderhart on Facebook says:

    No way am I doing it. It’s no bueno !

    8

    0
  4. Dawn Aubrey on Facebook Dawn Aubrey on Facebook says:

    I love how I called A la Mode to make SURE I was NOT opted in, and the customer service rep kept saying: “Comparable Data is NOT assignment specific and therefore does not violate USPAP!” LMAOLMAOLMAO Seriously? You Mr. Customer Service Rep are the authority on what violates USPAP and what does not because your boss told you. Obviously, the appraiser doesn’t know what violates USPAP and needs a minimum wage customer service rep’s counsel. LMAOLMAOLMAO

    11

    0
    • I’ll let the attorneys in each state decide if the hybrid cyber-manure is legal or not. Dawn, did the alamode rep justify the THEFT of your data if you have NOT opted in? Did they explain how and the legal justification for searching our database to see if you have previously used a specific comparable sale so that they COULD offer it as a ‘better comp’ later?

      6

      0
      • Dawn Aubrey on Facebook Dawn Aubrey on Facebook says:

        Of course not. That’s why I’m desperately seeking another form software… Whatever Happened to that comment from Mark Skapinetz about another form software option?

        http://appraisersblogs.com/corelogic-acquisition-appraisers-ditch-a-la-mode

        3

        0
        • Hi Dawn, I think the name of the software Mark was posting about was “Freedom”. Last I heard is is about ready but not quite. I’m personally thinking about SFREP (No idea what it is). I already bought Homepeuter but not sure I have enough time for it. Cant beat the price though. Owner is incredible in terms of customer service.

          I have used Clickforms (Bradford) and have friends that swear by it. It’s fine but i dot like the price. I’m sure a lot of folks will report back from AFest about whose using what.

          2

          0
          • Dawn Aubrey on Facebook Dawn Aubrey on Facebook says:

            Mike, Mark Skapinetz said it was scheduled to be unveiled at AppraiserFest. He said he would touch base after to give me details since I couldn’t attend.

            What was the deal with Homepeuter? Does it require a ton of time?

            0

            0
            • Homeputer has to be set up from scratch as to forms you will use but otherwise seems simple enough. I haven’t bothered with it yet.

              Freedom sounds great if you are ok with cloud-based services and a monthly subscription fee. The developer developed appraisal genie previously. I was impressed by his presentation and desire NOT to release til all bugs worked out. I am SO anti-cloud-based subscription software that it’s hard for me to be objective, and perhaps properly appreciative of all he’s done. Keep an open mind is my best advice.

              1

              0
            • Dawn Aubrey on Facebook Dawn Aubrey on Facebook says:

              Dear Mike, I’m personally tired of giving all my money to “services.” A monthly subscription fee, while profitable for the biller, is not in my best interests. It would have to be pretty darn fabulous to justify it. Re: Cloud based… agreed with you there. Anything in the “cloud” can be hacked and is less safe than what’s on my computer (IMHO, whether accurate or not). I keep the data, no one else.

              Thanks for the tip on Homeputer. I’ll take a look at that!!

              2

              0
  5. Baggins Baggins says:

    Alternatively, Alamode may have forced appraisers to break the law with an automatic opt in policy.

    Alternatively, every appraiser who uses typing services may have already been in violation of privacy policies for a long time now.

    I have a saying, something I hope more appraisers can find value in; “If you can talk the language of real estate competently, you should be able to write that same language into your reports yourself.” Or, um, see addenda, whatever floats seems to be the approach of the day. The tech industry ruined yet another non tech industry with their invasive ideas and ideals. Repeat after me, more for less, more for less, more for less. You must support your tech overlords because they know more than you, are better than you, and don’t forget to upgrade your devices and software routinely.

    5

    0
  6. Emily Shaw on Facebook Emily Shaw on Facebook says:

    I opted out, but not before I realized alamode had automatically opted me in.

    5

    0
    • Baggins Baggins says:

      I have a question, perhaps someone can answer this?

      Was the process of sharing comps database data automated? Was there notice or alerts or permissions requests? I’m on Aurora and do not know, presuming I’m not participating since I have no comps database in the first place.

      But I’m wondering if this just suddenly turned on, and captured complete databases automatically with updates and outbound data packets. I mean, did it just start and everyone’s comps database was automatically exported without them being aware? Need more clarity on details. Opting out means nothing if appraisers were auto opted in, and their entire comps database is already available for use.

      Does Alamode guarantee your comps data is not present in the database if you opt out? Is there shelf life policies to this data? Does the comps sharing database indicate the date of entry, type of appraisal the info was gleaned from? Is this an xml html process related event or did GP form data get exported as well?

      Dang, really glad I never upgraded from Aurora right now. I like Aurora, it’s efficient, easy to use, intuitive, and light in terms of memory use and such. A few years ago the figures were that half of all appraisers were still on Aurora. Is that still true? Anyone have info on current proportion of subscribers whom are still on Aurora? Anyone have info on total customer base if the recent buyout drained a substantial portion of subscribers yet?

      7

      0
  7. John Doe says:

    “From what we’re seeing, everything boils down to a single premise: CoreLogic launched SmartExchange to take appraisers data to put them out of business.

    This is absolutely, positively false. Here are a few reasons why.

    The timing of SmartExchange

    We see a lot of appraisers associating CoreLogic and SmartExchange as if SmartExchange wouldn’t have happened if a la mode wasn’t acquired by CoreLogic. This isn’t true. Many of you remember having conversations about “CompsXchange” in the early and mid-2000s. Development began years ahead of our acquisition and was announced in October 2017, seven months before our acquisition. SmartExchange has been part of our strategy for many years and wasn’t introduced by CoreLogic after they acquired a la mode.

    You might ask, “If you’ve been talking about it for a decade, why now”? Two things have happened in the last few years:

    1 – Appraisal report data has been collected by upstream platforms in the lending system with no reciprocation to appraisers for their own benefit. AMCs, delivery portals, lender clients, and UCDP all collect data as appraisals pass through their systems. Appraisers have known this for years and have been vocal critics of having their report data used against them to fuel review questions.

    SmartExchange is very clearly the answer to this problem because it democratizes the data that was previously locked behind others’ firewalls. Now everyone is on equal footing. With SmartExchange, you see how other appraisers have used comps in the past and have the opportunity to make comments on your comps to preempt questions from reviewers.

    2 – Lenders have the need for speed. The (false) appraiser shortage narrative wasn’t created because of an actual lack of appraisers. It started because lenders and their borrower clients were frustrated with longer than normal appraisal turn-times. We could debate whether near-instant appraisals are a good thing, but frankly it doesn’t matter. Lenders are the appraisal client, and they want the reports turned faster.

    SmartExchange aims to reduce appraisal turn-time in two ways. First, if you get a good comp hit from a peer in SmartExchange, one click on the “use” button is a heck of a lot faster than typing the 50+ UAD-required data fields. Second, if you note discrepancies between your comps and other appraisers’ uses, you’re going to cut down on time spent answering reviewers’ questions.

    What data from my reports is added to SmartExchange?

    First, if you don’t opt in, no data is uploaded to SmartExchange. If you do opt in, the only data uploaded to SmartExchange is the comparable property characteristic data from the comps grid. No adjustments are uploaded and no data from your subjects are added to SmartExchange.

    I’ve seen my data in SmartExchange even though I haven’t opted in. How did that happen?

    There are two ways this is possible. First, if you’ve got the property in your own local comps database, we’re going to show that data to you in the grid. This is a local database search, not a download from SmartExchange. Again, if you haven’t opted in, none of your data is uploaded from your machine.

    The second way you could see your own data without opting in is a byproduct of the data collection practices of the broader industry. AMCs, delivery portals, lender clients, and UCDP all collect data as appraisals pass through their systems. CoreLogic owns some of those systems and collects data in compliance with their own agreements. When we were acquired by CoreLogic and gained access to data that appraisers would have never had access to otherwise, it was a no-brainer for us to be transparent and provide that data back to appraisers through SmartExchange.

    How am I protected from having my data used against me?

    You’re protected by the SmartExchange terms of use. Specifically, paragraph three:

    “You hereby grant ALM and its affiliates a nonexclusive, perpetual, worldwide, fully paid license to contribute Your Property Data into SmartExchange and create derivative works in the form of products and data which may be provided to other members of the SmartExchange service.”

    Here it is clearly stated that a la mode and its affiliates can CONTRIBUTE data to SmartExchange. But also note the only ones who can CONSUME the data are other members of the SmartExchange service. Only SmartExchange members (appraisers using TOTAL) have access to the data in SmartExchange.

    Is CoreLogic is going to take all our data and build an AVM?

    No. This would be a bad idea both logically and in practice.

    Let’s handle the practical application first. The SmartExchange terms of use state that a la mode and its affiliates can CONTRIBUTE data. Not CONSUME data. Building an AVM would most certainly require the consumption of SmartExchange data, so it’s prohibited by these terms. The only people who can use SmartExchange are the other members of SmartExchange.

    Logically, it makes zero sense. Many of CoreLogic’s business units count appraisers as their customers. Why would any business work to eliminate their customers? Further, how would AVMs get data in the future if appraisers were put out of business? The AVM argument is false.

    If you’re not using the data to create an AVM, what is the “derivative works” language in the SmartExchange terms of use?

    In SmartExchange, when there is a discrepancy between your data and another appraiser’s we color the text in that field red so you can easily see the differences. Since the original appraiser didn’t submit the report with a red font color, we’ve changed the appraiser’s original use. This constitutes a “derivative product” because it’s different than the original.

    We’re also hearing that SmartExchange users get good data hits, but the original use was in ALL CAPS. We’re considering a feature that would allow appraisers to transform the all caps instance to normal case. This would constitute a derivative work.

    Also note from this paragraph in the Terms of Use that the derivative products are provided “to other members of the SmartExchange service”. This means that if you’re not a member of SmartExchange, you don’t get access to the data. It would violate our own terms of use to provide the data to a non-member.

    How does this save time when all the data contributed by other appraisers is wrong?

    If you see instances where you don’t agree with another appraiser’s use, simply don’t use their data. No time lost there. However, you can be fairly confident that your data will be compared to that other appraiser’s by some other system. You can indeed save time by noting why your data differs from other instances, so reviewers won’t email or call you for an explanation.

    And it could be that the other appraiser is right. We’ve heard from customers who saw differing data in SmartExchange, made a few phone calls, and discovered that their own data wasn’t correct. Having access to that other appraiser’s “wrong” data actually made for a more accurate report.

    One other thing to note on this idea that doesn’t have anything to do with the SmartExchange technology…

    There is a publicly visible survey on appraisersblogs.com (http://appraisersblogs.com/smart-exchange-pros-cons-4-appra…) where 95% of appraisers say they don’t trust other appraisers’ data. From a broader industry perspective, this is a bad look. I understand that the writer is trying to illustrate a point on SmartExchange. But the survey translates to “Look, even appraisers don’t trust each other’s data”.

    In a climate where some appraisers believe so strongly that they’re being pushed out of the business, a show of solidarity and confidence in the profession would have been a better move.

    Again, feel free to quote me on any of the items above. We’re not up to anything nefarious. We’re not stealing data. And we’re certainly not aiming to put appraisers out of business. In all three cases, the opposite is true.

    Dustin Moore
    a la mode”

    0

    7
    • mike says:

      Hate to tell you this Dustin, but it sounds like all b******* to me.

      7

      0
    • Advocate says:

      Sorry, those statements by Dustin Moore and reposted by John Doe have absolutely nothing to do with violating State Law or USPAP.

      3

      0
    • “Appraisal report data has been collected by upstream platforms in the lending system with no reciprocation to appraisers for their own benefit.”

      Translation: ‘We have been stealing your data for years, and you guys weren’t bright enough to pick up on this until recently’ Therefore it’s OK?

      WHO exactly is the royal “We” that Johnny Doe/Dustin Moore is/are referring to? alamode SOLD so it is not a separate ‘we’ anymore. It IS CorelaMode.

      Note to CoreLaMode: When you have to argue with your ‘valued’ customers to get them to accept a product they never asked for in the first place, then maybe your product is so bad as to even reflect negatively on your other services. Instead of continued insulting of our intelligence, if you really give a damn about customer retention, then stop your bad businesses practices.

      You guys at CoreLaMode/FNC/AppraisalPort ARE the ‘upstream platforms’ your lament opines about.

      3

      0
    • Jennie Scott on Facebook Jennie Scott on Facebook says:

      Yes, let’s handle the practical application first. What better way to gather data than from the source itself, the appraiser? Based on corelogic’s own website, I would be willing to bet that they have and still are. I have had suspicion for years that our data was being lifted. Especially when Mercury Network advertised that they were selling a guide to reasonable and customary fees by county and state. I took a glance at this data that they were selling. Tell me how they could have come up with this detailed info without peeking in on the appraisers software, invoices, and reports, and listing the form it was reported on! The appraised value! The room count! Seriously!!?? CoreLogic Mercury Network Fee Analytics

      Purchasing Alamode just made the gathering game easier. And when corelogic clearly hasn’t complied with FTC orders in the past on other data collection companies that they acquired, I would say they surely aren’t worried about a bunch of appraisers. https://www.corelogic.com/about-us/data.aspx

      2

      0
      • Compiling our fees and presenting them as ‘non AMC fees’ is highly suspect when the provider is an AMC (Corelogic). Additionally ‘inviting others’ to charge a specific fee IS an FTC violation. It is an invitation to price fixing. Then there is the issue of giving out our private business information in a published document. Its bad enough to steel our professional work product, but to then tell people what we have charged for specific work in a specific area is wrong.

        2

        0
  8. marion says:

    Hey Dustin, they are still waiting on you to come back to the appraiser’s forum, as apparently you did not answer the question asked there, and ran away after posting some sales pitch.

    7

    0
  9. Becky Lowell on Facebook Becky Lowell on Facebook says:

    Anonymous, why?

    3

    0
  10. Adam Sparks on Facebook Adam Sparks on Facebook says:

    Oh boy….

    2

    0

Leave a Reply

Your email address will not be published. Required fields are marked *

xml sitemap

The Possibly Just Became Reality!

by AppraisersBlogs time to read: 3 min