A Cry from the Appraisal Trenches: The Fall of GSE Oversight
Picture this: a system built to protect homeowners, backed by taxpayer dollars, now teetering on the edge of betrayal. The regulatory framework governing Government-Sponsored Enterprises (GSEs) was once a fortress of consumer protection, transparency, and fairness. As an appraiser, I’ve watched this fortress crumble. The rules imposed on GSEs and their partners—our trade-off for their congressional charter—have been chipped away through years of cunning maneuvers by trade groups and stakeholder interests. What’s left is a hollow shell, far removed from the original vision that fueled our work. The result? A housing market teetering on the brink, with appraisers like me caught in the crossfire.
Our Struggle in the Appraisal Arena
The appraisal industry, where we pour our expertise into ensuring fair valuations, has been gutted by regulatory sleight-of-hand. The MISMO standards gave birth to the Collateral Underwriter (CU), which plundered our intellectual property without a dime of compensation. Worse, that data was turned against us, hammering small businesses like ours into the ground. Enter the Appraisal Management Companies (AMCs)—the wolves in sheep’s clothing. Licensed only to manage appraisals, AMCs have sprawled into services meant for tightly regulated lenders. This tangled web lets lenders and AMCs dodge accountability, shoving liability onto our shoulders while shielding themselves from consumer lawsuits.
AMCs hit us harder with quasi-legal “junk fees,” as the Appraisal Regulation Compliance Council (ARCC) group has screamed for investigations. The Consumer Financial Protection Bureau’s (CFPB) Regulation Z Customary and Reasonable (C&R) fee interpretation gutted the Dodd-Frank Act’s mandate for market-rate fees—fees we’d earn without AMCs skimming the top. This loophole let AMCs sidestep independent fee surveys or Veterans Affairs (VA) local rates, dodging $10,000 to $20,000 daily fines per appraisal. Add predatory AMC practices and the “separation from loan production” rule, and it’s no wonder so many of us have fled GSE work, abandoning the consumer protections we once championed.
The regulatory rot doesn’t stop there. Rising debt-to-income ratios, loosened loan-to-value (LTV) standards, hybrid appraisals, unlicensed property data collectors, drive-by services, and a flood of substitute valuation products—evaluations, broker price opinions, desktops by out-of-state strangers, and automated valuation models (AVMs)—have sidelined our local expertise. The recent inter-agency AVM final rule only greases the skids, prioritizing these shortcuts over the rigorous valuations we provide.
The Bigger Scam: FNMA’s Loan Shell Game
Zoom out, and the picture gets uglier. The Federal National Mortgage Association (FNMA) wholesale loan program feels like a front to hide bad actors and shoddy work. Defaulted loans are repackaged as “reperforming” with sweetheart terms—40-year loans, 115% LTVs, or deferred payments handed out selectively under Diversity, Equity, and Inclusion (DEI) or other special lending banners. Jeremy Baggott called it a clandestine welfare program, and he’s not wrong. It’s corporate welfare, too, with properties funneled to elite investors at fire-sale prices, never reaching the public through programs like Good Neighbor or open Multiple Listing Services (MLS). These homes are hoarded as investment units, jacking up rents and sale prices, fueling a housing bubble, and strangling supply. And who gets the blame? Us, branded as “racist appraisers” while our voices are silenced under the banner of “appraisal modernization.”
Mic check. One two one two. Is anyone there? Is this thing on?
The CFPB’s Ticking Time Bomb
Here’s where it gets wild. The CFPB’s potential collapse could be a game-changer for us. If it goes down, so does its Regulation Z safe harbor that let AMCs lowball our fees. Without it, AMCs and lenders could face $10,000 to $20,000 fines per appraisal for dodging market-rate pay. A federal injunction has stalled the CFPB’s demise, but if it falls, the AMC model could implode—or lenders might finally have to foot the bill instead of bleeding us dry through fee splits. That could bring our best and brightest back to GSE lending, leveling the playing field with fairer work distribution.
A Battle Plan to Save the System
It’s time for Federal Housing Finance Agency (FHFA) Director William Pulte to step up and fight for us:
- Torch the AVM final rule and its DEI-driven “disparate valuation” algorithms that meddle with our work.
- Slash appraisal waiver thresholds (currently a reckless 98% LTV) and tighten DTI ratios to keep us in the game.
- Ban hybrid appraisals, property data collectors, evals, BPOs, and other flimsy valuation products for high-risk loans.
- End the perverse incentives tying GSE executive pay to sidelining us, falsely painting our work as “biased.”
- Stop the blacklisting, fake performance grades, and shady tiered rankings that lock us out. Replace them with a VA-style round-robin system for fair work distribution.
- Declare the CFPB’s safe harbor on Regulation Z C&R fees dead—or enforce market-rate pay for our work, effective now.
Why We Matter
We appraisers are the GSE system’s backbone, the last line of defense against fraud and predatory schemes. But regulatory decay and AMC greed have reduced our role to a flicker of its former strength. Restoring our place with fair pay and real oversight isn’t just about saving us—it’s about protecting consumers and stabilizing the housing market. So, I’m tapping the mic one more time: Is anyone out there? Is this thing on?
I admire the detailed thought, explanation, and presentation of this piece.
Now we can only pray that either Mr. Pulte or an associate of his sees this!
Thanks so very much!
Pulte will do what Trump. Wants. They want to destroy our FEMA and made it policy that no appraisals are needed in Pacific Palisades and Eaton Cyn from the huge climate-changed environment on Los Abgeles.
Pulte is a crony so he will do what Trump wants or get fired. Developers don’t like us that much, so don’t count his help in favor of anything that is LA and it is pathetically ignored for the pollution downwind to properties that were not burned. I read that 6 inches of dirt is contaminated by arsenic in the Palisades and lead and arsenic in Eaton cyn. That is the depth of my vegetable Garden. That is homes downwind and were Not. Buurned!
They will not help LA recover!
The Federal government is owned by Trump and his fellow “billionaires” are going to be the oligarchs in our country. I have a copy his appraisal from Doral and it was bs and fraudulent! Made as instructed by Trump because he thinks his properties are worth more because he owns or created them. Unless it is for county property taxes, then it is losing money! He bankrupt casinos and the house has the advantage!
This blog site is an endorsement for all his policies which he dictates in his Executive orders, many of which are illegal or unconstitutional.
Be.aware of what my views are because I have proof of what a con artist he is. He launders money and cheats to help Russian oligarchs get their unearned millions into property here. Do you all love him so much you can’t see his bad side or have you already joined the Trump train?
This article has absolutely nothing to do with Trump, FEMA, Los Angeles, contaminated soil, or any political conspiracy theories involving Russian oligarchs. It’s a detailed critique of the erosion of oversight within the GSE regulatory framework and the devastating effects of AMC overreach on the appraisal profession. Please read the article before launching into an unrelated rant. If you have comments relevant to the actual content—namely, Collateral Underwriter, MISMO standards, and the abuse of appraiser data—then by all means, contribute. But injecting political hysteria into a professional conversation helps no one and distracts from the real issues our industry is facing.
I read it. You know they want to sell the government properties like the Historic HUD HQ in WDC? I am sure someone will buy it and FEMA has been downsized and he can move the few left if he wants to and sell them to friends who kiss his you know, without us ever getting to bid on one assignment! His cronies will get. Tthem cheap, with his buddies gett them for cheap. He is following another playbook and he will allow the GSEs to use appraisal waivers, algorithms, AI, and all these techie assists for appraisers!
Who do you think engineered the 2008 bailout? Banks and Wall Street with their derivitives! Homes are so high priced, everyone who has one is holding now due to the fact that they have so much fake equity and a lower interest rate, there is a huge lack of supply, Don’t forget that investors bought sfrs as rentals, so our grown kids can’t afford to compete at the current price points. Zillow lost big money buying houses for what their algorithms computed.
When things get like this people talk about a market correction. I know Texas appraisers I reviewed that say it is a bear mkt in oil so the economy is good. Meanwhile, Dallas properties were nearing California prices. People appraised a Dollar General with comps in other states that concluded in an over $2 million plus ripoff store in the boonies! No regard to location! CRE is going nuts with the over supply of office because everyone wants to worrk at home! I have done that for 40 years! Now that they can work at home and be productive, the workers like that and even Elon says they need to come into the office!
I am anticipating a housing crash with high construction costs due to his tarrifs. USA doesn’t want to make widgets for Walmart, so when China shipped cargo to LA Long Beach they are hung up for trump’s tarrifs, and we Americans are going to pay for it. The fires in CA and Oregon, WA, NEW Mexico and other places, make the cost of lumber so high! 4 years ago I did fire damage appraisals for an insurance company any I charged a lot because it takes extra work to reconstruct the house or commercial building, find comps right before the fire and get pictures from MLS etc, and drive your neighborhood on Google for what the whole town looked liked. But maybe AI will make those insureds get minimum value and it won’t pencil out when construction costs go up more! A lot of older people who. Bought modest homes that burned won’t have time left in their lifetimes to rebuild.
Pulte built move-up housing and very little entry-level homes in metro LA! Or anywhere! We need to print homes with earthquake, landslide and environmental sustainable materials that last!
Remember, we don’t like regulations on us, and oil companies still deny climate change, so LA and any other of our Sanctuary cities for immigrants will be denied Federal Block grants.
When he gives an Executive Order that deregulated AI, those Zucks are going to be the haves and while he distracts us with arresting a judge like today, you will understand his criminal manipulation of the stock market with his tariff tantrums! Bitcoin has profited he and his family already who have made billions on trump coin! He is incentivizing sales of. Trump coin for a dinner at the White House with him!
But THE CLINTON’S USE OF THE LINCOLN BEDROOM! BENGAZI!
Do you ask when you verify a sale if any bitcoin wal paid as part of the purchase price?
Industrial buildings that use enormous amounts of electricity for AI. RESIDENTIAL customers will PAY! AI will be manipulated.
As an appraiser I have my opinions of value developed by doing everything myself. I sign it in blood, sweat and tears. I will work all night, but i disagree how we are treated. We are not all racists! But our President is and Elon is an Africaaner from the most racist place I have visited (1974 when they still had Apartheid!
We as a profession will have become consumed by AI and Chatgpt before we can whip out our clipboard and lazer measuring tool.
Good luck my peers! Even the so called non-profit Appraisal Institute is pushing AI! WTF! I have paid dues since 1980 and it is so corrupt, the board fired Cindy Chance, PhD. After a secret meeting, She was formerly from the Kennedyy center and an Ethicist so you know women who are competent in this profession are not allowed to be a part of thhhis fraternity!
I was designated by an old boys network that has been run by a corrupt ceo Amorin who awarded me my MAI in 1990, and was AIs first ceo at $450k per year! That is more than Trump makes as president! The crook Jeremy writes about, Bunton at the Foundation ($800k/yr,, and Jim Parks at ASC ?/yr? And he says let’s let non-degreed appraisers get their certified general license or designation! With no college!
I want to throw out the bums too, but I only have 45 years of experience, but my whole being is about ETHICS FIRST!
You can keep defending the system all you want, but let’s call it what it really is — a rigged, rotted-out shell of what it used to be.
You and the rest of the AI cronies can polish up your talking points all day long, but no amount of spin changes the facts:
The GSEs sold us out.
The Appraisal Institute sold us out.
And people like you were too busy climbing the political ladder to care.
You talk about ethics while collecting dues from a membership you helped abandon. You think “AI innovation” is going to save the profession?
It’s going to bury it. And when it does, you’ll have a front-row seat — because you helped open the door.
We aren’t fooled. You can keep waving the flag for the very organizations that sold their souls for government contracts and corporate handouts.
Meanwhile, the real appraisers — the ones out here actually signing their names in blood, sweat, and tears, we’re the ones getting crushed.
You’re defending a sinking ship. Congratulations.
I assume you are defending trump. So why don’t you review his appraisal on the Doral Golf Course!
This is not a real estate appraisal, it is a pumped up business valuation.
Everyone, please you review it too!
https://acrobat.adobe.com/id/urn:aaid:sc:VA6C2:be23ea01-92e8-4a8e-8ea0-e4b1c2d2c5c7
You have an MAI designation — so you do know the difference between a real estate appraisal and a business valuation. Which makes your comment either deliberately misleading or intellectually dishonest.
Doral wasn’t valued as just dirt and sticks. It’s a complex income-producing asset with brand value, revenue streams, and business components — factors any competent appraiser recognizes. Pretending otherwise to score political points cheapens your credibility, not Trump’s.
You’re free to hate whoever you want, but at least be honest about the fundamentals you supposedly mastered to earn those letters after your name.
Implying all our problems started in the last 90 days is moronic. Either someone is really out of touch or has an angry agenda. I agree, this is not the place for that uncalled for rhetoric no matter what side of the isle one sits on. It certainly doesn’t bring any meaningful discussion to the table. Leave politics out of it. Unsupported accusations of a sitting president is exactly what is happening to our profession. How ironic.
So do you agree he should crash the economy to drain the swamp?
Crashing the economy was never the strategy — fixing bloated, broken systems was. Context matters.
Where does all this horse crap nonsense come from? You sure you are not in a TDS FB forum somewhere!?
I’m entertained. Are you not entertained?
The real deal is that from all sides, from all political perspectives, appraisers share many core views and beliefs about the profession, about ethics. What are we really doing here? What’s our actual professional purpose? What driving force was the root cause which brought this industry forward into a mainstream career choice as that relates to lending oversight and regulatory structure?
Consumer protection. Keep the focus on consumer protection, transparency, and fair business dealings. That is what will be best for everybody. Nobody could be so naive to believe the system is perfect and everyone is perfectly honest. To believe that one person could ever be in charge of everything. That is not how complex systems work. The now ‘former GSE appraisers’ whom refused to work with amc’s serve as a contemporary example of what happens to honest people in dishonest systems. Just when you thought it was over, most others already turned out the lights. Exciting times. What does happen next?
Deborah, how does being anti-Trump play into the shenanigans perpetuated by the administrations of Bush and Obama from 2001-2017? 16 years of Bullshitfoolery followed by 4 years of defending false Russia allegations and then another 4 years of Obama (Oh, I’m sorry, Biden-Hell)? Pull your head out of the sand, woman.
Don’t discuss this issue in anger! I am pointing out observations I have made in Appraisal Before licensing!
I have been an appraiser since 1979, and while you speak to me emphatically defennding a convicted criminal and money-launderer, I see you as an incompetent at looking at anything objectively, which is our job. Turn in your license before you get sued. They are looking for you, so now that they arrested a judge in WI, people will be coming for appraisers sooner or later.
Thank you for the history lesson — 1979 was a great year for disco, but not so much for objective thinking, apparently. Your rant is a fascinating case study in projection. While you’re busy clutching your pearls and writing manifestos about imaginary lawsuits, the rest of us are out here doing actual work.
Maybe take a break from the conspiracy newsletters and realize: disagreeing with you isn’t grounds for revoking a license — it’s called having a functioning brain. Stay paranoid though. It suits you.
There is a particular clock that I believe comes from the Black Forest region of Germany. I forget the name but I have this uncanny feeling the name would sum up this unsolicited, unnecessary bashing of everyone on this blog. Darn, I wish I could remember. Any ideas out there?
Powerful and spot-on! As a fellow appraiser, I’ve felt every word of this firsthand. You’ve captured exactly how regulatory decay, AMC overreach, and unchecked greed have hollowed out the integrity of our profession. Your call to action is clear and essential—not just for appraisers, but for homeowners who deserve genuine protection against fraud and predatory lending. This needs to be widely heard and urgently acted upon. Keep tapping that mic—it’s definitely on!
HUD legal department told me an appraisal error and omission is quote, “a property eligibility issue, not a property appraisal issue.” Yet refuse to force the lender to order a field review to prove the property’s eligibility.
https://appraisersblogs.com/uncovering-flaws-in-fha-appraisal-n-loan-review-process/
GSE’s aren’t protecting consumers, they are covering for and condoning fraud.
https://appraisersblogs.com/uncovering-flaws-in-fha-appraisal-n-loan-review-process/#google_vignette
Great thoughts. The CFPB is dead or soon will be. Forget NAR they don’t protect us though gladly take our money. Appraisal Institute… LOL. Forget them.
Fannie is acting like a private company with a monopoly… create forms and rules, control the data mining, select the AMCs, push the non-appraisal products, lobby Federal and State governments, etc. How do you change that?
Homeowners don’t know what is happening. Probably don’t care they just want their cash out.
The Federal and State governments HAVE to pass laws thet absolutely REQUIRE a full blown appraisal and not allow BPOS, hybrids, waivers OR AMC employee appraisers doing field work that steals from independent appraisers. Without ACTUAL laws it is all blah blah.
Thanks. I like Mr Ford’s take; Simply roll all regulations back to the date of the original versions. Rescind every subtle change installed over time which incrementally diluted what should have been effective regulatory safe guards. At first this idea may seem rather radical. Take a minute and think about the gravity of what happened, how the people and systems acclimated to new conditions. What is radical is what we have now. What is sensible is what they purposefully diluted with a continual series of policy and regulatory changes.
Per the home owners comment. Yeah, you’re right for the most part. But there is a resurgence in this country of thrift and more conservative fiscal attitudes. Personally I like a higher interest rate, because this creates a climate which rewards savers and penalizes those whom live debt based lifestyles. The non stop maximum mortgage production pipeline driving the economy routine is getting old, has been counter productive for some time. The policies have caused more than a complete generation to not have access or fairly balanced opportunity. The plunder has continued unabated for that long.
Still thankful all these years later we had just enough education on the dangers of debt, with a healthy fear of some contractual obligations and associated penalties, we never played the debt game. If we want the most powerful catalyst to force people to make smarter financial decisions… Well, those rules are already on the books. It’s called the obligations of contracts, that shall not be interfered with. It’s like we’re all personally underwriting other peoples risky lending decisions. That is not a fair system. Cash out should be something people have to get away from GSE systems to even pursue, requiring second liens. GSE’s should be for origination, refinances, and cash outs should be strictly prohibited.
This is truly the issue at hand! The laws are there, but so are the loopholes. The federal government needs to close the loopholes, so the mortgage and appraisal processes work as they were intended. And… I have to believe the general public is pretty much in the dark with regard to the shenanigans going on that are not only affecting home values but further endangering their tax dollars.
Excellent read
I love this call to arms action campaign, this well versed column that’s comes out with a loud bull horn effect, and we all are sitting behind our computers ready to light the torches and grab the pitchforks screaming YEA! LET’S GO!, LETS STORM THE GATES!!! WE WANT BLOOD…. but who actually has a battle plan to show us boots on the ground appraisers how to infiltrate the lines, flank the enemies and win our declaration of truth… Nice read… but now what?
The question of the ages Eric. What are we going to do about this overbearing oversized government and these runaway institutions which nobody can seem to sort out? That’s the question and the answer right there at the same time. Allow the free market to decide, roll back so much government involvement. Get the government out of the business of mortgage lending. Until that time, we’ll pursue more readily available solutions such as requesting key FHFA policy changes. Write letters; every day working appraisers have value, we are worth the time and effort, a few simply policy revisions, revitalize this industry. Copy them this article.
What is liberty? Why do we want liberty, what is it’s value in our every day lives, to our children, our communities? How does more rather than less liberty structure society around us and influence governments and businesses? How can we move away from systems rife with exploitation and replace them with something more beneficial to everyone, rather than a select few? We could start with; No taxation without representation. Back to the basics.
The GSE’s are supposed to solidify underwriting safeguards to guarantee stability of lending programs for the benefit of the American people; the American dream of home ownership. Instead their callous disregard for fair dealings and preference to implement disproportionate benefits to some affinity groups but not others, funnel wealth to insider corporate partners rather than send opportunity back to the people, equates to nothing more than a tax on the majority. Aside from total complete reform, these organizations have outlived their useful date.
_____________
(Copied text from a letter I wrote this morning.) As usual I’m with the good Dr Ron Paul on the matter; The fact the government was involved in the first place is what in the end, caused things to be worse than as if the government was never involved in the first place. Why is the government even into lending? Why do GSE’s even exist? Despite the good intentions at the time of forming GSE’s, like all other government programs, there is an open door for exploitation whenever the government becomes involved in anything. And here we are. The whole thing is entirely predictable really. The concept of too big to fail is the problem. If we’d just let the free market decide, artificial incentives would abate, there would be more open competition, without the government back stop, corporations and institutions whom took these risks would have been relegated to insolvency and forgotten about in the history books long ago. Truly if we’re ever going to have total systems corrections in this country; repeal 1913 the federal reserve act. Everything down stream of that is just continual re arranging of chairs and window dressing. So you know, we roll with the program and don’t really get up in arms or too surprised about these things anymore. As usual; education is going to be the key to long term success.
Well said, but the question remains… How can we as appraisers, a simple cog in the system, help move the elephant in the room? I see lots of appraisers with knowledgeable English and vast amounts of history to belch from a soap box, but WHAT CAN WE DO to start the change, to protect the industry..?
Never stop I guess. Keep fighting. Write the letters. Do what groups like ASC and TAF have failed to properly accomplish; educate people on the value of appraisers, specifically in mortgage lending. Publish a point of view article right here. Be patient.
Look at what just happened. The line moved. Like a flash of lightning, pretty substantial shake ups. Select people walked right in there to fhfa, gse’s, other non profits and ngo’s and said; ‘You are fired’ to hundreds and thousands of bureaucrats, meddlers, and free loaders, including executives. They walked entire departments out with ten minutes notice and said get out do not come back. That really happened.
CFPB is on life support and so is the C&R safe harbor billing interpretation. Amc’s are embroiled in class actions and may be on their last breath, the house of cards could fall, a successful claim means all the other amc’s could be lined up next. ARCC really formed and really hired Cindy Chance. They’re bringing the receipts, some likely to be under whistle blower protection statutes. Appraisers whom worked for amc’s under their look the other way pay to play defrauding consumers program might just go down with the amc’s, via the indemnification clauses they all signed. The hope state regulatory boards will awake from a long slumber and stop listening to the corrupt amc reps whom whisper in their ears. One of these days someone is going to get the bright idea to audit the entire amc industry and lenders whom used them.
The gse’s have buried all the discovery via the wholesale direct to corporation reo and non performing loan restructuring, but the evidence and the stacked risk never went away. Big picture, there has been so much corruption through every institution, nobody was willing to do anything about their own or anyone elses groups for fear of reprisal or disrupting their own gravy train. Like a dam who’s structural integrity was challenged by decades of neglect and improper management, what does come next? It’s not over yet. Write a letter. Keep posting. Share the links. Come up with something and if it does not work, try something new. Make a meme. Never stop. If you are reading this message, you are the resistance.
That’s fun for me to write but may not be what you’re actually looking for. Dip back and read every Mike Ford article. He was our guide which led so many to this point right here and now. Be sure to subscribe to Jeremy Bagotts news articles, he posts every friday and sends them via email, you don’t even need an X account. Between Ford and Bagott, the ensuing discovery by so many other appraisers, they blew the lid off, chips are in the air, yet to land. Now is the time to write letters, publish, share information, and influence policy decisions. The same thing that led us here can lead us out; policy changes. Hope that helps.
https://appraisersblogs.com/author/mike-ford/
https://appraisersblogs.com/author/jeremy-bagott/
Ron Paul is a libertarian idealogue, which is fine as far as it goes. But economic history doesn’t support your ideas that everything would be fine with government out of the way. Pre-1913 economic history is replete with economic contractions: the Panic of 1873 and the Long Depression; Depression of 1882-1885; Panic of 1893; Panic of 1896; Panic of 1907, to name just some of them. Severe economic and financial contractions. Imagine if one of the GSEs were allowed to fail, with no conservatorship. We would see a spectacular collapse in residential lending, much higher interest rates, and massive foreclosures on people unable to refinance at any price. Regulation is messy but the alternative is not better.
That’s not necessarily true. The alternative would be a free market explosion of new mortgage participators, whom would eventually compete for the peoples business. They would attract the capital necessary from the free markets. There would be a clearer understanding that saving is good and excess debt is bad. Instead of the reverse rewards we see today which promotes risk taking ahead of fiscal responsibility. If one compares the financial harms and built up risk, what we have now under the GSE central modeling in conjunction with the fed’s money printing is arguably worse than what happened in the past. The federal reserve is a core reason why there is so much economic disparity today. The usury and prosperity through debt program has always been used to manipulate markets, who wins, and who loses. It represents a departure from merit based systems and the principal of the trade turn and sound labor. We’re not just swimming in artificial parity, we’re drowning in it. We used to be the economic power house of the world. Because we produced more than we consumed. We can not continue to print our way out of this. There will be pain point in any systems correction and I’ll ask the same question again; What exactly is wrong with lower housing prices? Price is not the same thing as value and if we want more value in housing, the price needs to come down or the dollar needs to quit being deflated. 1913 is a tax on the peoples money supply without adequate representation. The federal reserve; 100 years of not being federal, and not having any reserves. We’ve been living in a bubble our entire lives. When does it end?
Post this again I suppose. It’s old content but is still relevant today. NORM economics. National Organization for Raw Materials.
http://www.normeconomics.com/
The health, robustness, and sustainability of the American economy is directly tied to the production of raw materials and the price at which those raw materials first enter into commercial channels. When raw materials enter trade channels at prices in balance with the prices of labor and capital, the economy operates on an earned-income basis with no buildup of public and private debt. Conversely, when raw materials enter trade channels at less-than-parity prices with labor and capital, the economy lacks sufficient earned dollars to operate on an debt-free basis, therefore, public and private debt accumulates.
That simple explanation of raw material economics explains why America today suffers from more than $50-trillion in public and private debt and why much of it is unserviceable.
I took a quick look at the link and while I don’t want to get too deep into it, it looks like they are a bunch of non-economist farmers who believe that farming is the most important thing in the economy. Their concentration on raw materials doesn’t seem very useful in modern economies dominated by services and intellectual property. None of these guys have any economic credentials of note – I have an economics degree and I’ve never heard of them or their theory.
Aside from that, the GSEs have the kind of economies of scale and banking relationships that allow people all over the world to invest in bonds backed by US mortgages. What’s the alternative? Joe’s Mortgage and Body Shop can’t marshal the resources to reach investors in Saudi Arabia. And after a long period, when your hypothesized new lenders grow and scale, they will consolidate, and put us in the same position of too big to fail institutions. But we already had that occur in the 2000s. Private lenders tapping the capital markets like Countrywide and Long Beach Savings/Ameriquest pioneered sub-prime lending and led the market to boom and crash. Parts of Long Beach were acquired by Washington Mutual and set the stage for its failure in 2008, acquired by Chase using public funds. No, deregulated Wild West mortgage markets aren’t inherently better.
I believe the more workable and local traditional solution for reliable lending used to go by another name. Credit unions. Dare to dream for a return to in house loans, local lending from the same people in that community as opposed to venture capitalists and bottom line industrialists a world away. Pretty sure we’ll never return to the days of penny auctions but we could still be better insulated with fairer terms as local economies would support by seeking out less centralized models rather than more.
The NORM guys are interesting. They are farmers and local economists whom hailed from several of the northern states. They were successful people whom actually ran working farms, livestock, had their hand in local economies, believe in the merits of self sufficiency. Used to listen to them on the radio and they were quite well informed, not sure if they’re even still around that was over twenty years ago.
They follow the Bastiat principals of production vs plunder. As long as people eat drink need a place to sleep and consume from raw materials, the economic theories revolving around the harms of central planning and imposed parity pricing are likely to hold up.
The basic premise; All wealth comes from the land. Accumulated wealth downstream from production is not possible unless production continues at a balanced pace. Because nothing happens unless we produce, otherwise we’re just borrowing. None of the intellectual non tangible type economy could exist in the first place if not for the initial stewardship and production of labor which requires raw material. Think of it like the farmer selling direct vs unnecessarily convoluted supply chains. No matter where you may be in the supply chain, nothing moves unless the farmer can produce, the timber man can cut, the millers can saw, the miners can mine, and do so at profitable pricing scales.
Their primary argument was that the over abundance of red tape and regulation drove the industries to the ground which then required parity pricing intervention from government. Something that would not have happened in a free market where those whom plunder the system were unable to have as much control over policies and activities over those whom deal with natural resources. Sort of a throwback to the now familiar cut the red tape and let us work type argument. Your tax dollars, hard at work.
The longer the plunder continues, the more taxing becomes necessary, the greater the debt grows. And here we are today. Something in that argument always stuck with me as making more sense than central planning.
Sort of relevant to the GSE structures now. Their primary claim to fame seems to be redirecting wealth rather than facilitating equal access or helping honest true production. Think derivatives, fractional reserve lending, and crt swaps. Post this again I suppose…
I like your counters Vince, you provide very good arguments and that’s good for everyone, if we’d all think about these things more carefully and be better educated on these sorts of topics. I’m not claiming to somehow be more right, but the logical challenge seems to continue to align in an acceptable manner to promote the ideas. We can all agree something is not working here and systems corrections are needed.
I support credit unions. I’m a credit union member. Good old American socialism! But they aren’t immune from the principle of growth, and need regulation. The bucolic image of the local small-town banker making home loans ignores the reality that many local economies aren’t diversified, and these institutions would fail regularly if they are too small, without regulation and backstops like deposit insurance.
Derivatives and swaps are perfect illustrations of what happens when inventive bankers are freed from regulation and able to create highly leveraged, highly risky products. You get the 2008 financial crisis and cascading failures.
Finally, I don’t know why the Raw Materials Theory of Value is any different from Marx’s Labor Theory of Value. Both are reductionist and try to place the ultimate nature of economics on one factor of production.
The raw materials argument is a reality of modern civilization. Why economists examine this over and over again through the centuries. Governments tend to not be very good at creating wealth, or managing wealth, but rather focus on redistributing other peoples wealth, often in wildly disproportionate unfair manners. Taxation without representation has become the new status quo. So yes, a reductionist theory may be a more realistic way to look at things. That does not mean we’re asking for socialism, but rather taking a more realistic pragmatic approach to problem identification and problem solutions. Article 1 Section X, no thing but gold and silver coin…. We’ve been living on borrowed time this entire time. Illusionary wealth, from the printing press.
When people talk about firing up the economic engines again in this country, they are really talking about the need for raw materials, production, harvesting, labor, etc. When they turn to government incentives and attracting capital as a trade off to investors from half a world away, they’re not gaining wealth for the people, rather engaged in a series of trades which often involve imbalanced wealth distribution.
Everything downstream of raw material production on the supply chain is just trading wealth. Which is why fiat currency and fractional reserve banking is so frightening. Wealth created out of thin air is merely a tax on the money and it is not wealth creation. Which is why we say; we’re tired of the inflationary policies.
The government incentives to direct more into housing or any system than the people and the free market can sustain, is what leads to the market bubbles and eventual inevitable collapses. The poisonous protectionism is made possible by…. You guessed it; central planning.
On the question of regulation. That’s more complicated. We expect our money to be safe. And people place their wealth into lending institutions, anticipating a positive outcome. Then when things go wrong, the banks lawyer up and protect their ill gotten gains. So the people call for government to help. Then government gets involved. Then government becomes co opted by those seeking ill gotten gains. Then the money is not safe, all over again. Now the wealth is increasingly consolidated through centrally planned systems, at even greater risk than before the government ever became involved. And all losses get charged to the taxpayer instead of the losses being borne by the one institution, and their customers. So now everyone is taxed, instead of those whom took that risk to bank with banksters whom were taking all those risks.
That is taxation without representation, the point of the argument. Sure go ahead and regulate the hell out of the lending institutions if that’s what needed for general economic stability, but we should not have the taxpayer backing and deposit guarantees. It’s all an illusion anyways, FDIC could not cover a fraction of a fraction of a single percentage of deposits, the unfunded liabilities are already that far out. That’s where tort law is supposed to come in for end of the line accountability. And that can’t happen properly when the government by way of the back stop, is also providing liability shields. That’s how we end up with the Holder Doctrine and too big to fail.
My vote remains for; fines based on income for corporate and large businesses. Then when companies and bad actors take those risks, they won’t be able to sit back and count all the cash later, even when things go wrong. One of the most devious things about inflation, is that table based fines can never keep up. Therefore the wrong doers are always ahead of the regulation and penalties. If the penalties actually served their intended purpose of dissuading the behavior, the companies would go insolvent, their companies will be auctioned off, and the next entrepreneur is unlikely to follow the same pattern or mistake. Instead of what we have now is a finely tuned machine where they all know how to exploit the system, and exploit the system they do. If you’re a regular guy and break the law, lie, cheat, steal, you go bankrupt and lose everything, then you go to jail. But if you’re a corporation working with the government, embezzle fraud cook the books, like cheat and steal on top, no big deal, tax the loss and keep moving. Continued profits.
I think a few hundred years ago, someone talked about this. Image attached. ‘Bank wars’.
The free market today is just give the keys to Trump and his oligarchs!
It’s amazing how every topic — economics, banking, even the weather — somehow leads you back to Trump. It’s like you’re running a one-woman cable news panel inside your head. Must be exhausting! Maybe take a breather, touch some grass, and let the adults discuss actual economics without dragging your personal boogeyman into every post
Do what I have learned since HVCC 2006. Andrew Cuomo filed against eappraisit and got HVCC because appraisers were taking values from owners and blessing them with their licensed opinion because they were whores for more work. I refused to workfor ant AMC after they were accepted by banks and other lenders so they farmed out the Appraisal departments to amcs. Clerks who are not professionals take our bids and broadcast them in droves and I am not getting any less for my job, splitting the fee with an unprofessional because I won’t let them pick my comps or have some ex-con shoot photos of my subject!
I am only here to help you residential appraisers. You have lost your hard-earned license to zillow because the gses will prefer not having us defend our opinions because they know more than us?
I never saw politics in appraisal until 1996 when I worked in Orange county for a guy who hired me to start up commercial division of his firm. He gave generously to Nute Gringrich. It lasted 2 months and I made him move me back to Agoura Hills because he was a crook into REITs and I appraised lots of fractional interests. He expected me to favor his clients. As I said I am not anyone’s fool and I have never been suedlike Ford! Here’s the tone on this blog when we don’t even know how many appraisers are in his union. I wish we had one, but this blog is certainly political, and most don’t have the cajones to use their real names.
I have been censored on this Baggins newsletter, so when you do that to me, I don’t feel welcome helping you all with my extensive history in this profession, so I won’t give insults like David gave because he is way off thinking I am suppressing him because I am more qualified and objective. I spot trumpsters because I have appraised a lot of trophy property in my career. I would enjoy a debate on the political aspects of appraiser regulation. The AI, Foundation and ASC are all destroying our profession and appraisers who are techbros ate selling us on crap algorithms like Chatgpt!
Deborah,
Your persistent comments on AppraisersBlogs continue to spread falsehoods, and we must address this firmly. To be clear: AppraisersBlogs has no affiliation with The American Guild of Appraisers, Mike Ford, or Baggins. Our advertising for organizations like The American Guild of Appraisers and VaCAP (Virginia Coalition of Appraiser Professionals) is strictly promotional. Mike Ford and Baggins are independent contributors, with Mike Ford authoring articles, like Jeremy Baggott, and Baggins commenting, as you do. Your repeated claims of ownership or affiliation are false and need to cease.
Your assertions that AppraisersBlogs endorses specific political figures or policies are entirely unfounded. We permit political discourse because appraisal issues are intertwined with policy, but your comments consistently derail discussions with irrelevant attacks on political figures, particularly your fixation on topics unrelated to the articles. This undermines productive dialogue.
We placed your comments in moderation due to this pattern of disruptive behavior, including spreading misinformation and posting off-topic rants. We ask that you refrain from spreading falsehoods and irrelevant content.
Wow, what a journey — from HVCC to Cuomo to Zillow to techbros to Newt Gingrich in one post. Impressive! Somewhere in that cross-country rant, you almost made a point. Maybe next time use a roadmap.
Also, thanks for letting everyone know you “won’t give insults like David.” I appreciate the shoutout — but trust me, I wasn’t insulting you. I was simply observing a beautiful meltdown in the wild. Keep it coming!
I’m impressed that she appears to have actually read my economic theory posts. Hopefully.
I was hoping Vince would keep at it, I’m still not sure what he meant by credit unions being good old American socialism.
Maybe if we slapped an orange toupee on some of the GSE employees and amc trade group people, ran a few news hit pieces, more people would pay attention to this vital issue.
In 2009 I completed 215 appraisals. Fast forward to 2025. I have completed 8 appraisal reports to date. Why the drop? Every reason you state in this article. The appraisal underground has blacklisted, misused, abused and defiled what used to be a reputable, admired and inherently unbiased profession. The overlords who rule the appraisal underground hide behind federal designations, non-profit corporations, misappropriated grants, lenders, and politicians with nefarious intentions. They have methodically decimated our profession, artificially inflated the housing market, removed REOs from public consumption and put homeowners and consumers at risk. Its too late to be investigating behind the curtain to see who is pulling the lever. The damage cannot be undone. Retirement is calling my name.
Look what a solicitor dropped at my door the other day. (image) The long term GSE mismanagement with all the hybrid, waivers, and ‘modernized’ black box avm products has actually resulted in lawn mowing paying more than professionally licensed real property valuation service which trillions of taxpayer backed loans are based upon. We always knew this day would come. Dude is racking up $35 per mow, x probably 8 a day, x 5 days a week, x 4 weeks a month, x what is likely a solid six month set. Chalking up $33.6k gross billing in a half years time for one single lawn care worker. No liability, no special insurance, no continuing education, no state oversight, low equipment startup costs, no required middle management, direct to consumer service. Flip a few employee’s into the mix, the local lawn mowing crew is beating out most gse focused appraisal firms these days. I’d bet they graduate to some business contract within the first year and really turn the volume up.
People have become conditioned to an illogical premise. Logic challenge; If housing units continue to be built, and loans continue to be issued for them. If complexity of valuation increases with age and character changes, never ending alterations to neighborhoods and individual homes. If there are more people than ever before seeking participation in the housing market. If we have successfully identified and enumerated factual verification of fatal flaws in outsourced services, automated services, and automatic valuation modeling systems. If there is a constant stream of fraud and schemes around every corner which the full service on site licensed appraiser is one of the only people to prevent this from happening in the first place, and financial crimes and schemes is at an all time high. (Can you guess what question comes next?) Shouldn’t there be more demand for more full service appraisers over time rather than less?
Kim every single point you made is accurate as can be. Let’s hope someone is listening. Hamp! Nice to see you too. You should post a link to your youtube video to save the appraisal industry. When you posted that I jumped up and was excited; this guy is so good and we need more like him.
Out of the last fifteen or so bids I’ve gotten from an AMC, I’ve not responded to or declined about twelve of them. Typically because there is either insufficient market data or the sale price is so out of line I couldn’t commit fraud all day long and hit the price. I’ve bid about three and gotten one. That one was a $1M+ which I bid low because I was familiar with the area and there appeared to be adequate market data to support the stated sale price. Then, after they and I made the deal, they raised the sale price $50K. The house was under construction, nearing completion, but not “substantially complete and ready for occupancy”. Then a firestorm erupted because I required a final inspection. I told the builder that “ready for occupancy” meant that the buyer could back his U-Haul up to the house and start unloading furniture. I mean, how hard is it? And, oh, I’m estimating that about half of the bids I get reek of fraud the moment I get the bid and start researching the property and its market.
Sounds familiar.
Good. I don’t think you understand the reason and causes of you only having 8 jobs!
Defaming me does not make your point. Deborah, you need professional help. Moderators, please do something before Deborah harms herself irreparably.
Appreciate the career advice from someone who measures success by the number of bridges they’ve burned. Must be exhausting being the self-appointed expert on everyone else’s business. Maybe take a minute and realize — you’re not helping, you’re just heckling from the cheap seats. But hey, at least you’re consistent!
I believe like Kim. Soon there will be a mass exodus of appraisers near retirement age that feel like they have been bullied long enough. Then the GSEs will have what they wanted all along. Their Big Data nightmare waiting to destroy American real estate and mortgage markets; all the data and no one to understand it. Sad times, but that retirement thing looks better all the time. News tech fees out and less coming in. Business doesn’t work that way, not for long.
Clock is ticking, everyone needs to write letters to FHFA right now.
https://www.fhfa.gov/contact
Submit a general question or comment seems to be like the right choice.
I filed a complaint with CFPB against WellsFargo and their AMC Rels Valuation several years ago (undue pressure). They removed me from their panel for non-cooperation and I filed a complaint. Guess what? Nothing happened. I was contacted by a representative from CFPB who told me in no uncertain terms that I would be blacklisted in the industry if I went through with it. And that’s a COMPLAINT, Baggins, not a letter. I’ve written more letters than reports this year without any kind of warm/fuzzy feeling that I was making a dent in the bullshit wall. I admire your determination, but this girl is getting tired.
Why not get your listing agent license! You could help a lot of people by being both an appraiser and And an appraiser. Only working both roles is not allowed on same property.
If I were a seller or buyer, I would consider you more qualified to list my house because you will be more realistic and can review the loan appraisal and competently advise your client if they refuse to agree to a market value and you can kill the bad comps! Good luck!
Have completed 20 reports for 2025. Since over 90% of my reports are non lender estates, divorce and legal work. When there’s a complete shortage of appraisers soon (or 2026) and when the next refi and purchase market happens with lower rates is when I move to plan B.
Plan B is Nothing but the Rush, lender reports, inspected and delivered to lenders in less than 2-3 days from inspection. When the phone rings or email requested reach 10-40 requests a day for appraisal services is when my fees increase to ridiculous fees, but the lenders don’t care, they only just want the report now and not months from now.
Now you are teaching your competitors tricks of the trade. I have done litigation and forensic appraisal since 1979. They would call on Friday afternoon from the law office and tell me I needed to do a big job over the weekend and it was Forth of July weekend. I would charge them triple the regular fee, plus pre-trial conference, depositions, court waiting, expert witness testimony at $350 / hrs. With 1/2 for travel time, mileage, and court exhibits at cost plus my time making big boards with photos of construction defects, missed easements, etc and secretarial time at $35/HR
I loved this profession because competitors share data, at least appraisers who do similar work. I am happy to see you doing this to help our appraisers who need to know how to work the business side in your favor, just by being supportive of fellow appraisers!
https://www.youtube.com/watch?v=mTeHg0XuDro&t=15s
Not sure if this is the right one, but talks about the overall topic. Thanks for the nice words. Let me know if this isn’t right. Thx
Just watched that. You really nailed it on that video. I missed that one, thanks, and worth the watch. ‘That’s a flat out lie’. Tell them Hamp! You covered so much of what is wrong with pdc’s and alternatives in ten minutes, impressive. Even the previous FHFA manager tweeted out that the new LTV waiver and other pass through tools which removed appraisers was a major mistake and not well thought out policy change ‘Just say no’.
This is the one I was talking about; Dear President Trump, help us remake the appraisal industry. ‘That is not good for the public trust, for Americans, and their retirement accounts.’ ‘Why is it only appraisers that need modernization?’ ‘The GSE’s have been stomping on appraisers so hard.’ ‘Why would the GSE’s spend tax dollars to complain on appraisers?’ ‘Computer valuations are not the solution to any valuation problem.’ ‘Please look at fannie and freddie and appraisal management companies, and there are a lot of people in the appraisal industry that can help you understand it. Look at both sides and see why so many appraisers are complaining. Don’t kill off the appraisal industry. While we still have good people here, we need to use that talent and make sure we’re not just doing something, not letting money control everything. Appraisers are to honor the public trust and we need to get back to that.’
https://www.youtube.com/watch?v=tgHphSXXWms
Sometimes I wonder if I’m even making a difference. There are so many senior appraisers whom have already made the argument, and presented far better than I ever could. We’re going to keep trying. We’re not giving up. Thank you.
Don’t expect the Donald to like honest appraisers or help you! He tricked and lied to get your vote because he is not allowing any more elections. You are really naive!
I told a California AMC today that I’m not interested in doing hybrid appraisals”. I have somewhere around 2,000 hours of property inspection education from the best property inspectors in Texas, that is, actual professional real estate inspectors, engineers, Haag Engineering & Simpson Strong Tie engineers (storm, structural, roof, lightning, mold, electrical, exterior, interior, water, wind, flood damage, etc). Why on God’s green Earth would I even think about trusting some unknown person to “inform” me?! I imagine most of you have what Native Americans called “the eye”. I do.
I can not think of a better counter to a hybrid request than that, great job. Those are the kind of real world experience points appraisers need more of. That’s what got me about appraisal licensing and testing, that knowledge base was for the most part not required to pass. One time I asked a senior appraiser what I needed to do in order to become a better appraiser. He told me; Go to the hardware store, and stay there. lol. Was great advice. Have a meme for that one too.
What is value? The sum total of the parts. What parts? Well, let’s get into that, then various measures of effective age depreciation. I personally never paid attention to depreciated scales because it’s quite difficult to put a general percentage of depreciation on an entire home. I’ve always found it more simple and reliable to take the time to draw up the long cost tallies, apply individual line item adjusts in the grid for relevant differences rather than whip out the ouji board and pretend to extrapolate meaningful derived market adjustments.
If a property data collector could not describe a good portion of these materials and detail their relevant function and purpose, they’re not in possession of enough knowledge and experience for an appraiser to rely on for;…… Drumroll; Credible assignment results.
Another rant about how appraisers are essential to consumer protection and stabilizing the real estate market. Every consumer lawsuit against an appraiser meets with the defense of privity of contract – that is, third parties cannot sue. And the homeowner, home buyer, or home seller are always third parties in the lending scenario. How can appraisers base their importance on a right of reliance that doesn’t exist?
And how do appraisers stabilize the real estate market? Did they do so in the S &L crisis? Well, that was pre-FIRREA and licensing. Did they do so in the early 2000s? Or in the Great Recession? Or in the Covid disruptions? Stabilizing the market is not a function of appraisal. The function of appraisal is to estimate market value as of the date of inspection (usually). Not intrinsic value, long-term value, or any other value. We could imagine these concepts, but they are not part of appraisal practice today.
Appraisers provide stability by hindering runaway price and irresponsible practice which is realized when the independent check and balance of the appraisers position is absent. Right now, runaway pricing as market corrections which would have happened, never come to be. Or on the down side, can help keep losses minimized.
If there were more appraisers, and less ability for those whom drive disruptive risky practices to side step and ignore valuation professionals, the impacts of financial catastrophes is less rather than more.
The right of reliance, the appraisers dealing with complaints from gse’s to state boards, or the law firms pursuing arguably fictitious accusations of racial bias, seeking socialistic price equality regardless of all the complex economic factors which drive housing price. The counter is duty of service, nobody can write away all legal liability when providing service to the general public. This is why EO insurance is mandatory.
Appraisers are essential to consumer protection. It’s not a coincidence that every major event rides along with valuation professionals being sidelined or silenced.
How essential were the appraisers in the 2008 crash, the largest in our history? I’ll give you a hint while you are touting our irreplaceable importance to consumer protection, we were right at the foundation of the housing crisis. Negative Ams, buydowns, Builder points in excess of 15% skyrocketing appreciation. Yep, they appraised just fine. Lender influence wouldn’t have been a big deal if appraisers didn’t succumb to it. The housing market collapsed with you at the helm. Sunk like the Titanic. Now you are screaming that you are the only thing keeping the housing industry from ruin?
AMCs were few and far between back then and their explosion came out of the need to interject someone between the lenders and the appraisers to stop the influence. We’ve made this bed, now we are wetting it whining that our business stinks because of an AMC, a hybrid appraisal, or disposition of REO properties. Its a tired cry. Honestly in my area the appraisers who are starving are the ones who have given terrible service, acted entitled and more important in their roles than they really are through their existence. They are running out of places to hide. This is all just a new excuse to be a starving appraiser.
The market is changing. Technology is here. Fees aren’t staying as high as they were. Appraisal requirements and forms aren’t static.
“Adapt or perish, now as ever, is nature’s inexorable imperative”.
H. G. Wells
Nope. Wrong again. Many of the mb’s and appraisers whom were partaking in the inflated highest and best over valuation game were washed out fired or both. Entire institutions and people whom worked for them were gone before amc’s ever gained dominance.
Stop whining about appraisers whom stand up for their careers, casting a blanket and projecting your own insecurities regarding a valid secondary check and balance system. As if all the products on the market at the time, which failed miserably, were somehow approved or put in place by the appraisers. You may be mistaking the fault of the melt down with appraisers, while the blame lies much further up the ladder. If not for appraisers signaling the alarms at the time, the harm would have been much worse. You do not know what you’re talking about. Only deficient appraisers whom can’t make a living, turn to exploitative amc models. Meaning the other three out of four appraisers whom service legal, courts, government, private, and the best lenders in the business whom did not take the amc route, they’re the deficient appraisers. It’s the cut rate outsourcing automated amc appraisers whom are the best. How could anyone have missed this? We’ve been wrong all along!
Where in the heck did this guy come from? Obviously pro centralization pro amc. We’re all hiding in the shadows now, hoping to not have our deficient services ‘discovered’. Jr, you can’t be serious and if you are, quite unserious and not worth listening to. Great story telling though. File that away in the fiction section, perhaps even some form of amc propaganda.
Thanks for playing. Try again.
” Only deficient appraisers whom can’t make a living, turn to exploitative amc models. Meaning the other three out of four appraisers whom service legal, courts, government, private, and the best lenders in the business whom did not take the amc route, they’re the deficient appraisers. It’s the cut rate outsourcing automated amc appraisers whom are the best. How could anyone have missed this? We’ve been wrong all along!
Where in the heck did this guy come from? Obviously pro centralization pro amc. We’re all hiding in the shadows now, hoping to not have our deficient services ‘discovered’. Jr, you can’t be serious and if you are, quite unserious and not worth listening to. Great story telling though. File that away in the fiction section, perhaps even some form of amc propaganda.”
Saying appraisers who (well you incorrectly say whom) do work for AMCs are deficient appraisers who can’t make a living otherwise, is the most egregiously foolish statement I have seen here. Its flat out ignorant and insulting. As I’ve said before, there are AMCs who pay as much as direct lenders. You have to find them. And if you aren’t smart enough to do that you are leaving money on the table. Just like you need to be smart enough not to work for the bad ones. Most appraisers I know have a mix of work from numerous sources, banks, mortgage lenders, AMCs, builders, CUs etc, and are very busy. Its easy to tell the appraisers who can’t hold a client. They are the ones wanting “a round robin” and no checks and balances on their quality or service.
I’ll await more of your conspiracy theories as to why you can’t get work, why everyone is out to get you and why AMCs owe you billions. Its entertaining.
Professional complainers. You are prolific if nothing else.
Pointing the finger at appraisers for the 2008 crash is like blaming the weatherman for the storm. Were some appraisers swayed by lender pressure? Sure. But the real architects of the disaster were Wall Street’s toxic mortgage-backed securities, regulators napping on the job, and lenders peddling predatory loans. Appraisers didn’t dream up subprime mortgages or package them into trillion-dollar catastrophes—we were just trying to navigate a rigged market.
Let me share a slice of reality from before the crash. I regularly appraised properties below contract price—once, a new construction came in 15% under, and the builder tried to blacklist me. Buyers still paid full price, coughing up extra cash to bridge the gap in a seller’s market. I checked those properties years later: every single one foreclosed. So, who’s to blame? The appraiser who called it accurately, or the borrowers and lenders who ignored the red flags? I wasn’t alone—colleagues reported the same. We held the line, but the market’s frenzy steamrolled reason.
Your idea that AMCs fixed lender influence doesn’t hold up when you look at cases like Fastapp AMC (https://appraisersblogs.com/alleged-violations-of-appraiser-independence-at-fastapp-amc), where Horowitz, the AMC founder, directed “thousands of appraisals to a small handful of appraisers who will appraise properties at values requested by Horowitz’s broker and lender clients…” That’s not independence—it’s a quid pro quo, and plenty of evidence shows AMCs pressuring appraisers to hit numbers.
Technology’s here, and fees shift—point taken. But waving H.G. Wells to call appraisers dinosaurs dodges the real issue. We’re not anti-progress; we’re sounding the alarm, like the article does, against hybrids, AVMs, and REO fire sales that risk another bubble. If you’re doing fine, congrats. But writing off struggling appraisers as lazy while ignoring AMCs’ predatory practices and FNMA’s loan shell games is a flimsy cop-out.
Let’s recount. A person shows up constantly berating appraisers. Specifically intending to dilute or distract from any message which claims the current system with amc’s has deeply rooted fundamental problems. Always showing up to indirectly defend amc process. Then disparages people and uses the classical reverse psychology calling known collusion a conspiracy, while claiming success gained from lack of ethic and predatory behaviors is in fact, the proper avenue to take. Presuming those whom advocate for honest process, are not working and are simply not capable individuals.
Must be the PR arm of the amc industry or something similar. Nobody here is buying this tired rhetoric. Jr, is that all you’ve got? I’m very entertained and sure many others find your antics intriguing as well. You can’t make predatory activity something the masses will accept. You can’t make racketeering legal. And a tiger can’t change it’s stripes. I think it’s pretty obvious who’s on the side of truth and justice, standing up for tens of thousands of small business appraisers and consumers alike, and whom is attempting to provide cover for financial predators.
Thanks for playing. Try again. You may consider something more effective than copying statements and throwing attitude.
A tale as old as the RE appraisal.profession. I just turned 65 and put my license on temporary inactive. If the tides change then I’ll reconsider starting up again. For right now, I’m done. AMC’s want a quote and turn time. In AMC speak that’s a fee from 1990 and a turn time of 2 days. In other words they could care less about quality while they charge a premium to the borrower. Oh, and let’s not forget our “bias”.
And then you suddenly awakened from your dream …
I have the same dream, but they’ve only begun staking us out on the fire ant mound in the blazing Sun.
Vince already took the edge off. We’re riding this thing until the wheels fall off. Which is likely to be right quick unless the new FHFA director makes some changes. Call me a dreamer. But I’m not the only one.
What the general public doesn’t understand, I believe, is that Fannie Mae went under conservatorship after the 2008 market crash. This is not a good thing. It’s one step from bankruptcy. By definition, “a conservatorship is a legal arrangement where a court appoints a conservator (a family member, friend, or other responsible person) to manage the personal and/or financial affairs of another adult (the conservatee) who is unable to do so themselves. This occurs when the conservatee is deemed incapacitated due to mental illness, physical disability, or other reasons that make them unable to manage their own affairs.” Conservatorship is a kind word for babysitting.
Since conservatorship, saying the FHFA is like a babysitter for Fannie Mae doesn’t quite capture it — it’s more like hiring a babysitter who shows up, dumps a five-pound bag of Skittles in the kid’s lap, hands them a pack of matches for “entertainment,” and then congratulates themselves for providing a “structured environment.”
Instead of helping Fannie Mae grow up and move toward independence, the FHFA has basically encouraged a sugar-fueled, fire-hazard meltdown — then acted shocked when things don’t magically fix themselves. For over a decade, they’ve perfected the art of doing the bare minimum, dodging tough decisions, and pretending that somehow, this was all part of a master plan while the FHFA is busy watching Tik Tok videos and plowing through Red Bulls like it’s the last 4-pack they are gonna make.
At this point, calling them “inept” is almost generous. It’s like praising the babysitter for “creative problem-solving” when the living room is literally on fire. I sincerely hope this becomes public knowledge (a 60 Minutes special report would be helpful) and Pulte can resolve a really bad situation.
With the wonderful ARCC now involved and the potential collapse of the CFBP and Pulte heading up the FHFA, maybe – just maybe, we can start moving toward a sane approach to providing funding and home valuation without burning down the house so to speak.
Absolutely love this. Really, really puts it all in perspective and cuts right through the smoke and mirrors. This is the type of message that needs to get out to the public. This, a child can understand. Big thumbs 👍.
Thanks for your comment. I did see in the 4am news today that FNMA was somewhat exposed in regard to the condominium “blacklist” in Florida. I though that was interesting. I’m not sure if the media is afraid to mention indiscretions or they just aren’t getting the information. Likely, a little of both.
This is so painfully discouraging to read, which is why I quit appraising a decade ago after getting certified. What a rotten profession when given how residential appraisers are treated by the state, federal government, AMC and of course the banks with the help of Blackstone. Will justice ever be served?
I just took another look at the 3.6 URAR report. The present URAR form has 6 pages of forms which requires over 1,000 questions as to data to fill in each box of the form which takes me many hours to input one report.
The present 6 page form also has 18 variables in a vertical array such as sale price, cash or finance, concessions, lot size, etc. In looking at the proposed 3.6 URAR 21 page form in a vertical array are now the sale price, terms, concessions, lot size etc, but when you add up the variables on the form there are a total of 41 descriptions on a grid for adjustment.
This new form is going to require a lot more time to form fill than before and I fail to see how this 3.6 URAR form modernization will improve over the present form. For years I have told my clients there were 18 variables to each property that can be Positive or Negative that effect value. So now the new form has 41 variables. All I can say is my fees for service are going up significantly on 3.6 URAR lender work or it is a NO for me.
I make my living off of Boomer Generation Non Lender Work at over 90% of what I appraise. Estates, Divorces, Inherited Homes and Legal work for Attorneys. The new 21 page form report to me is a waste of time and that’s all i have to offer in my review. As a Real Estate Broker Owner, an Appraiser and Consultant I will continue to do Non Lender Work and pick up a MLO Mortgage Loan Originator License to make Reverse Loans to Boomer Generations. To me that’s where the money is and the direction I will pursue going forward.
Beyond the unnecessary complexity of the form, the grid being spread out over multiple pages which creates mystifyingly difficult mathematical reconciliation, no combined net/gross adjustment indicators, down to irrelevant matter which is clearly using appraisers to become superfluous data gathering minions for later monetization and privacy violating aspects of consumers data. To the inability to print out the form on paper for ease of explanation to home owners or to work in challenging situations where the full array of fancy and unnecessary tech items may not be present, or charged. We need something we can print on paper before the form begins to be filled. New forms are like a great reset, stun everyone for no apparent reason, turn everyones lights off, trash a century of meaningful appraisal form development to start from scratch, then call it modernization. It would appear the appraisal modernization program has this entire time been one big setup to install a different system which functions more as a liability secrecy shield, a fraud facilitation tool.
Nobody outside of the GSE realm will understand the new ‘interactive’ form. Not the state board members. Not the independent appraisers whom may be called for third party review or comparative second opinion appraisers whom use general purpose forms or are only familiar with the 1004. Not the lawyers, not the judges, not the juries. Not people reviewing comparative general purpose or traditional 1004 forms. Not the underwriters, nor the administrative non licensed appraiser reviewers. FNMA’s new forms virtually guarantee that meaningful appraisal review outside of gse specialty appraisers can not happen, or if it does, it will be many long years before everyone can get retrained up to speed. So only compliant amc appraisers will fill out the new forms, and be able to review those forms. Mandating a rubber stamp on everything. Appraisers will be powerless to answer conflicting contradictions, as the interactive form suddenly adds this one thing, and takes this one thing away simultaneously. There will be no fixed standard anymore.
FHFA stepped in and said; get everything back on track, no more delays. They moved up and clarified the timelines on the new forms, probably whipped the developers around a bit. But they’re stepping on a landmine with the appraisal modernization campaign, doing the dirty work without realizing what’s happening.
FHFA should scrap the new forms project and be done with it right now asap. That’s called cost savings and eliminating unnecessary redundancies. If there is new or more data that FNMA wants, they can simply draw up a one page new form with new data points to fill and say this additional form will now be a required add on to the 1004 form for all origination transactions.
See how easy that was? I could draw that up myself using simple tools in a week or two, and fit all the new data lines they want in there. Block it out. Add a few interactive data mapping points to several data fields. Done. This should not take an entire team of technology graduates three years and millions of dollars to produce. They made the new forms unnecessarily complicated, as is typical for tech people these days to milk their positions by screwing everyone else over whom does not know how to code. FNMA could have sourced free labor from gaming forums and gotten this project done quicker and more comprehensively than what they’ve done. The new forms development committee has consistently downplayed or ignored never ending appraiser objections and criticisms at their meetings, and through written communications.
We’re all thankful the new forms have been delayed this long, and are unlikely to be adopted by HUD or the VA. Nobody is polling appraisers on these matters. Ask a thousand appraisers if they want to use the new forms, from what we can gather online, most say absolutely not. Three out of four appraisers nationally refuse to work with amc’s, and amc’s dominate over 85% of all origination appraisal requests. Over half of all appraisers refuse to be in service to GSE’s and the mortgage lending consumer for origination purposes, because of FNMA & FHFA policies surrounding appraisers. We’ve got over half of the industry retiring or leaving, and for those that stay, only a minuscule proportion of them will be interested in completing these new forms.
Then FNMA will claim once more; appraiser shortage. And use this as justification to bypass even more checks and balances, move to more automation. They’ll probably say they have an underwriter shortage for people qualified to deal with the new forms. The work arounds are endless and it’s difficult to understand how the appraisal modernization campaign is anything other than a concerted effort to remove the oversight brought by independent third party appraisers. They’re not modernizing anything and should more appropriately brand the campaign as the appraiser elimination effort. And that’s exactly what Mr Miller reported about on the ‘rumor mill’ article. Where he claimed FNMA executives were overheard saying they planned to eliminate the majority of gse appraisers by mid this year.
https://appraisersblogs.com/gse-executive-boasts-scheme-2-slash-appraiser-numbers/
It is exhausting trying to address mortgage fraud and lender altering of documentation once the fraudulent paper trail was discovered. In our issue of appraisal failure and that the seller (Freddie) property being ineligibile in the first place (but ignored to pass the seller-servicer failed eligibility buck onto the VA buyer), we found no accountability by lender, Servicer or VA. In fact, the only one who stepped up was the appraiser. The VA has admitted part of the problem is lack of lender SAR oversight, and that our specific type of lender fraud utilizing counterfeit and incomplete documentation is new to them, and they don’t know how to force the lender to address and remedy. Lender does not care as they just want to steal our property– knowing the vacant land is valuable even if the fraudulent manufactured home structure must be removed. The whole situation was begun with a mh dealer taking a decertified, for salvage my and using fraudulent documents called it new to the county record. The appraiser failed to stop work and require lender obtain IBTS Verification when no HUD Labels were found on the structure. The lender ignored duty to order IBTS and just passed everything as if true and complete. The discovery and confirmation of the waterfall of fraudulent paper trail has become a nightmare. Every professional involved points to another and my disabled veteran husband and I are left holding the empty equity bag.
Comments and advice will be appreciated. Freddie and Fannie have rules and guidelines but what does it matter if rules are simply ignored?
Your story sounds very familiar.
https://appraisersblogs.com/uncovering-flaws-in-fha-appraisal-n-loan-review-process/
This person needs the knowledge of appraisers whom can post the relevant state federal and applicable gse guidelines, the over all structure of the portion of the industry, to help her legal staff determine the appropriate course of action. FYI, matters pertaining to ITBS reports and loan approval are the lenders responsibility. All the appraiser does is report ‘eyes on site’ data to the lender, per the appraisal performance guidelines prescribed by the GSE program, the lenders underwriting guidelines, state licensing requirements. After that point, compliance requirement is the full responsibility of the lender.
There used to be a follow up requirement for the independent third party appraiser to provide a follow up ‘final inspection’ report to verify any ‘subject to’ appraisal requirements were met. Inspectors safety verification, completion or correction of property deficiency, missing fire alarms, failure of basic utility function tests, missing tags, etc, etc. This is but one of the now effectively retired work products appraisers no longer are able to as regularly tap into. Issuing final inspection requests brings alongside the likely probability of that appraiser being substituted via down grading or down ranking, having a longer over all turn time and higher fee, substituted for appraisers whom do not call such important third party verification or compliance assurance. Again, for labels and tags, that data must be stated on the Manufactured Home appraisal form, but can be over ridden by the underwriter if the appraiser reports the data is not available and stickers or tags were removed.
“In fact the only person whom stepped up was the appraiser.” / In most probable scenarios; that’s another appraiser sidelined and down, limited black listing. If the lender is tied into an amc, that appraiser may have been put on a multiple non VA lender blacklist as well, via tiered performance and volume ranking downgrade.
Rose. Use the ‘contact us’ link at the top of the page, contact the site administrator, and see if they can put you in touch with an appraiser in a more private manner for more detailed accurate information.
I think I see what is going to happen; the “new” forms are way too confusing, old appraisers are going to retire, creating a “shortage” of appraisers; presto-chango…Fannie/Freddie can now say the appraisal process is not needed because there are no appraisers…they now have total control to do whatever they want, they almost have that now. The average homeowner or home buyer has no idea what is happening and they don’t care either; they ONLY care about getting the home the wife fell in love with, what’s the monthly payment, how long can I stretch out the mortgage…no one in the real estate & mortgage industry wants to know the TRUE market value of the home, except the appraiser. We are the only ones who don’t make huge amounts of money on a deal; the realtors do, the banks do, we just get our pittance of a fee for ALL the liability. I had an AMC who remains nameless, suffice to say they are a like a space ship, want a revision on a report requesting an explanation of each comp, how each adjustment was made, where I arrived at an adjustment figure, listing out all the sales I used for a “paired-sales-analysis”, specifying the condition of the interior of the garages as compared to the subject and adjusting accordingly, why lot sizes under an acre aren’t adjusted per SF of land, I’ll bet the AVM’s don’t have to do all that. I’m willing to do this but why when appraisal waivers and AVM’s will result in handing out mortgage loans like tic-tacs at a senior citizens gala. Just my rant for the day…goodbye appraisal profession, it’s been a good ride, the US taxpayer is going to take it in the shorts again in 5 years when all the you know what hits the fan.
It is precisely why GSE’s keep scope creep and adding more and more data points, data analysis, new forms, 1004MC is in… then 1004MC is out… and all sorts of requirements. They truly believe that they have pushed appraisers out with “modernization” while appraisers continue to adapt… and very well at that.
You want modernization? Get rid of ENV files, get rid of AMC’s that clog up the pipelines and reduce revenue for the ones actually doing the work (and prevent the use of trainees, etc) which in turn would allow appraisers to hire and train a whole new generation.
The only appraiser shortage has been purposefully caused by GSE requirements, AMC’s intrusion and monopoly, and DEI in order to create the environment for their mass AI driven appraiser-less valuations against all sorts of Federal and State laws, ethics, morals, and intelligence.
Ron Paul and Andrew Jackson are two of the most racist politicians this nation has ever encountered. It makes you wonder why Baggins continually quotes these two individuals.
Talking about an end to never ending war, an end to foreign interventionist policies, sound money, oversight of politicians and bureaucrats. Evil partners in crime the dastardly villains Daniel McAdams and Chris Rossinni, Senator Rand Paul, Congress person Thomas Massie. Their financial facilitators; Birch Gold group and citizen donations. The yearly meetings for the Liberty Institute with all the thousands of guests and keynote speakers.
https://www.youtube.com/ronpaullibertyreport
328,000 subscribers, on one site alone. Clearly, all you have to do is sit through one episode, the proof is undeniable.
Try something new.
https://thefederalist.com/2021/02/23/stop-smearing-christians-as-christian-nationalists-just-because-they-value-both-faith-and-freedom/
IF or When the CFPB gets dissolved REG Z will not go away, and will revert back to how it was before CFPB/Dodd-Frank. It would depend on how Congress or the courts handle the transition of regulatory authority to either Federal Reserve Board, Office of the Comptroller of the Currency (OCC), or the Federal Deposit Insurance Corporation (FDIC).
I’m not sure that this new form is all that and a bag of chips. Will it even survive to become THE FORM?
If it does get put into place I predict it will not last for 12 months.
Thank you Pat. I’m hopeful that FHA will not adopt this new form. Or that once implemented, the ensuing industry wide calamity will illustrate this programs flawed presumptions about form filling. It’s discouraging that FHFA stepped in to the GSE’s and cracked the whip on the long delayed slow roll out of the appraisal modernization campaign. Like get back to work we need results people, without more carefully examining the appraisal industry.
They should scrap the new appraisal forms project all together. If there is additional data required, they can create a one or two page additional form set for appraisers to include instead. Non appraiser tech people whom are not receptive to licensed appraiser criticism or suggestions created the new form. They don’t even grasp the most basic concept that the adjustment grid is a math equation, the necessity of that being on one single page, with clear net/gross adjustment indicators, and other basic elements. None of the rest of the industry will adopt this new form. Not courts, not lawyers, not independent appraisers taking private requests. The new form creates a different standard which will alienate the most qualified and experienced appraisers out there, and be even more difficult for consumers to comprehend or get additional third party opinions regarding.
But again, that appears to be the point. They’ve spent years and millions of dollars, confused everyone, and there has never been a clear direction on this ‘interactive form’. It’s still to this day some tech persons wild dream of something new, and has never been something the appraisal or lender community has agreed upon or the majority having proclaimed is vital and necessary. The top people whom demanded the new form and got this rolling are literally fired and no longer working at these institutions. So why are they continuing to push the new appraisal form? The cumulative brain drain and human energy expenditure needed to implement a highly complex technically challenging new digitally interactive lending form has not been measured. Certainly millions and millions of man hours will be wasted on this through every faucet of the industry; appraisers, software providers, brokers, underwriters, realty agents, consumers, insurers, the new need for ongoing advanced technical support. They’re all going to be completely confused. That is the opposite of efficient process. DOGE the new appraisal form immediately is what most appraisers agree on.
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Was re reading posts on this one today. Thank you to the many posters whom chimed in with positive commentary. In other related threads, several posters stated how they actually did call into Morgan and Morgan trying to bring attention to the content on this website. Also how they personally called FHFA and had a difficult time reaching anyone. Those are the efforts that can make a real difference. So thank you everyone whom made that effort. Keep trying. If you did not make it through, try again. Everyone reading this, please take the time to write and call, if all you do is provide a link to several recent articles here, that’s a meaningful action worth the time and effort.
And a final push; FHFA contact information link.
https://www.fhfa.gov/contact
OCC contact link (oversees the ASC and all the orgs downstream of them.)
https://www.occ.treas.gov/about/connect-with-us/contact-the-occ/index-contact-the-occ.html
CongressionalLiaison@occ.treas.gov (via the congressional affairs link.)
https://www.occ.gov/about/connect-with-us/index-connect-with-us.html
https://www.occ.gov/about/connect-with-us/whistleblower-protection/index-whistleblower-reporting.html