AMC Reviews of Appraisals
Only the lender’s Underwriter should be able to request changes to the report and the lender should be the one that pays the appraiser…
An appraiser associate was having a discussion with one of the head review appraisers at HUD and the reviewer noticed that the Plat Map in the report did not correspond with the site size reported in the URAR form 1004. The appraiser stated that the public record and the Plat map did not agree with each other and that he chose the figure shown in public records. The reviewer questioned why he would choose the public record? He responded that when the report was reviewed by the AMC that they check the site size reported in the appraisal against the public record and if it does not agree, they require the appraiser to change the report and they cannot (will not) forward the completed report to the lender until it is corrected. The appraiser went on to say that the AMC refuses to send it to the lender and refuses to pay the appraiser unless the change is made. He went on to say since the AMC controls the payment to the appraiser that he has no choice but to go along with their request (demand).
This supports my contention that the AMC needs to forward the completed appraisal along with any review that they may do, to the lender and NOT request or demand that the appraiser make changes to the report. Only the lender’s Underwriter should be able to request changes to the report and the lender should be the one that pays the appraiser.
Everyone seems to ignore the fact that the AMC is not a party to the appraisal report, is not the intended User of the report and doesn’t sign the report. Why are they allowed to pressure the appraiser into making changes to the report for any reason even if there are errors or omissions? They should forward their findings along with the completed appraisal report to the lender. It is the lender’s responsibility to request changes to the report if they find it necessary.
The Appraisal Foundation, USPAP and the Mortgage industry should address this issue and correct it.
- Changes from Fannie Mae - February 3, 2022
- AMC Reviews of Appraisals - November 27, 2019
- New CA Law Negative Effect for Appraisers - November 8, 2019
What’s the rest of the story? Who was reprimanded by HUD? The appraiser? The lender? The AMC monkey? All of the above or none of the above?
No one is ever reprimanded
https://appraisersblogs.com/uncovering-flaws-in-fha-appraisal-n-loan-review-process/#google_vignette
They do this shit all the time usually its a shmuck behind a computer screen with some data output b.s …u have to push back
I attach the plot map but always refer to the legal description included in the report.
In California and I guess Louisiana many parcels were granted by the King of either Spain or France. These descriptions were subject to interpretation. Many ago several Title companies agreed to certainl surveys, as these areas developed these agreements were crowded, forcing newer agreements and for the Title companies to make payouts. ( some parcels’lots’ had, had 60′ of frontage and shrunk to 55″ etc) The appraiser MUST discus the problem and whether or not the RE- imaged property falls within the current set backs.
This is within the skills of the practicing appraiser, however it does require additional research and inquiry.
I built a house some years ago overlooking a wash. My subdivision had allowed practiced access to the lower land with a 40′ easement. Uses had changed over the years and the 40′ easement had somewhat re- aligned.
My neighbor and I COULD have equestrian lots when we bought the easement! Horses at the bottom of the hill for my little girls! When I sold the house the description had changed and explanations had to be given, Equestrian lots are worth more!
I agree it should come from an underwriter and not a reviewer. Some AMCs hire reviewers that are not appraisers and have department VPs with no formal education , appraiser license or college. In all fairness some are credible. How are they qualified to review our work or demand a change? Seems to me these AMCs need to have licensed or certified reviewers with market area knowledge.
Minor requests from the AMC don’t bother me. Freddie and Fannie’s algorithm that suggests “Comps” bothers me. If that is how AVMs work the forthcoming Reality Show is going to be fun to watch! Hey everyone welcome to the valuation wheel. We’ll have a robotic hand spin the big valuation wheel three times and use the average to determine your home’s value. Loans will be made utilizing that number.
What a crock of s&*#!!
The agent of the lender client made me report that way is not a valid approach to ‘credible assignment results’. Either the appraiser agrees with what he or she has signed their name to or they should not sign their name. The ethics book already addresses this.
If I had a dollar for every time the next ethics instructor talked about the million situational examples relating to ‘acceptable assignment conditions’. Accepting unacceptable assignment conditions does not relieve the appraiser of any responsibilities, but rather complicates the situation.
Analyzing this specific example is difficult without better context. What was the fnma cu risk analysis score? Was it 1-3, 4, or the dreaded 5? How many errors did the internal EO checker identify? How many manual pass throughs for CU flagged concerns in this specific report did the underwriter have to check off during the review process?
Why does the amc impose reportedly hardline non negotiable reporting standards? Is that an acceptable assignment condition? A complaint to a regulatory agency on this matter may possibly be better served by identifying that the amc may be forcing unacceptable assignment conditions on this point. Somewhere in the FNMA selling guide are clear statements about appraiser reporting flexibility based on the situation at hand.
Get to know the basics of the CU system. Save the image clip I have attached below. I’ve never been in a spot to have to actually send that but sounds like many here have.
Looks like much of the content is now behind a log in wall. Might still be accessible if you fill the data fields though, I don’t know. FAQ’s are still active though, you can at least read through those.
https://www.fanniemae.com/singlefamily/collateral-underwriter
Beautifully stated, and I want to be a contestant on this game show! I’ve perfected my scathing responses to these challenges… I like to point out in detail the reasons their so called “better comps” were not selected by me—-as long as I have to waste my time explaining, and they are willing to “burn the bridge” with a condescending demand…
Turn them into the state
Well 1) I would not have changed it because I’m sure their “public record” was from Corelogic (or someone similar) and if the legal description references the plat than that’s the end of it 2) Report them to the state board 3) I would stop working for them.
The solution sounds like better disclosure. I’d have included an image copy of both of the learned reporting data points.
Then when these A vs B choice scenarios roll around it’s truly up to the lender how to proceed. By disclosing both data points the appraiser stays covered and stays safe. It’s a coin flip if you get a revision request or not but nobody can really fault you for having selected one or the other. Disclose. Disclaim. The appraisal report is a legal instrument.
The appraiser in this article could have skipped the amc made me do it routine with a more thorough reporting strategy. By including data variance example evidence within the report itself, there can be no question that the appraiser disclosed and disclaimed as appropriate. Approaches like that make a nice workaround to possibly unacceptable assignment conditions.
Baggins,
I always include a copy of the full legal description and plat (if available cause a lot of my areas are old school and have only a legal with metes and bounds). There are a multitude of times were the public record states the wrong site size and this happens in both states I cover. When this happens a reseach of the property for at least two to three decades or more will happen and a call to the state agency to notify them of the discrepancy.
I’m pretty sure if sitting before the Board they will say report the difference and you should go with the legal description and plat (if available) not the public record.
Strike the comment.
What to do when the septic tank is on an adjacent property, or the fence encroaches, or the drive way needs more frontage to access the garage, or or, or, maybe the owner needs a way to make releases, maybe the excess property is not excess due to set back requirements.
WOW, didn’t mean to strike a nerve. Guessing I won’t be having a difference of opinion with you anymore.
Well I do report to the Assessor and they always tell me they apprerciate it. I’m not telling them to change anything just want to point out the difference. Wonder why they call it Legal Description? And that’s why I would not change it to the public record. Never said I was anything other than a boots on the ground appraiser.
Happy Thanksgiving!
Not directed at you. Context of the article. I was not aware we had a difference of opinion and who cares if we do? I’m putting too much into this.
Confucius says never jump without knowing where you will land.
In California the Assessor can’t arbitrary change the record. There has to be notice! It’s very nice to work with the assessor and share info, especially when you miss a measurement (like a 9 for a 6) etc. Courtesy, convenience, and awkwardness become confused from time to time. Gross data isn’t always bad data, practicing appraisers develop skills. When measuring in a large development assessment records can be IN-correct (developers changed plans, two story models incorporated other rooms upstairs, garages, became another bedroom). Lots of stuff happened. In older developments garages were converted, 1200 sf became the same house as the 1600 without a garage. Certain combinations of 12′ and 24′ could be RE-identified as trailer houses.
The EXPERIENCED appraiser IS responsible for data collection due to education, experience and verification.
I have used a deed reference to describe properties this is a great shortcut and you won’t make a transcribing error.
The discrepancy in site size from public records to plat should be addressed and made clear in the report. I would’ve reported the site stated in the public records. Why? That is the size site the property is being taxed by the city or county.
In California the Assessor can’t arbitrary change the record. There has to be notice! It’s very nice to work with the assessor and share info, especially when you miss a measurement (like a 9 for a 6) etc. Courtesy, convenience, and awkwardness become confused from time to time. Gross data isn’t always bad data, practicing appraisers develop skills. When measuring in a large development assessment records can be IN-correct (developers changed plans, two story models incorporated other rooms upstairs, garages, became another bedroom). Lots of stuff happened. In older developments garages were converted, 1200 sf became the same house as the 1600 without a garage. Certain combinations of 12? and 24? could be RE-identified as trailer houses.
The EXPERIENCED appraiser IS responsible for data collection due to education, experience and verification.
I have used a deed reference to describe properties this is a great shortcut and you won’t make a transcribing error.
Did like the Article.
Reality: the lender in the hustle & bustle of being behind on stacks of Files allows the HIT MAN- AMC to “review” request, & demand and where the lender “agrees WITH the demand after-the-fact”. Not saying this is happens 100% of the time & an appraiser would not welcome it 1% of the time.