Appraisers Should Voluntarily Follow ANSI for Desktops?
Can someone explain how we should voluntarily follow ANSI standard on desktop appraisals?
Appraisers, Fannie Mae has released a new FAQ document to help you understand how to implement and adhere to their ANSI measuring and reporting requirement. See the PDF document below or here.
Normally these documents are informative and provide good information. But in reading this one, I’m particularly puzzled by Q13, and I’m not sure if that’s a bad omen or not!
Q13 discusses DESKTOP appraisals, for which NO adherence to ANSI is required. It says so, right there, in Q13. And most of us now know that the FLOOR PLAN used for DESKTOP reports does not have to be ‘measured’ per ANSI. Although, there are multiple companies saying their floor plan/measuring software using a smart phone, does. The intent is for the FLOOR PLAN used in the DESKTOP report to come from any source the appraiser considers reliable.
But then, the last sentence in Q13 says that for DESKTOP assignments, the appraiser should “voluntarily follow” ANSI.
I’m open to having someone explain to me how we should voluntarily follow ANSI even though it’s not required to be followed when doing a DESKTOP appraisal! Remember, the appraiser doesn’t step foot anywhere near the property when it’s a DESKTOP report. It’s a bathrobe, bunny slippers, in the basement kind of environment to get reports done.
ANSI measuring, per Fannie Mae, is only required when the APPRAISER does the property inspection and provides a SKETCH for a traditional Single Family Residential (SFR) appraisal report, unless there is noted internal obsolescence, and the loan is being sold to Fannie Mae.
No. The standard is not required for desktop appraisals, nor is the exception code. We do encourage appraisers to voluntarily follow the standard on desktop appraisal assignments whenever feasible.
Dave Towne on e-AppraisersDirectory.com
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Good luck with all that ANSI stuff. I am not following the standard, it is not used by my local assessors/mls/realtors and therefore, in my opinion, will not allow me to provide credible results. It has actually help me move away from AMC’s….. 99% less stupid (yes, I said stupid) revision request and I no longer have to “train” their quality control personnel.
Freddie Mac and Fannie Mae are turning down any report that doesn’t follow ANSI. You’re free to do what you wish, but if you’re doing any lender work, those lenders are going to start scratching their heads when they can’t sell mortgages backed by your reports. Just a friendly warning, but I have a feeling that the phone will stop ringing if you keep ignoring ANSI. It’s also a USPAP violation if it’s in any of your engagement letters. Are you at least using the noncompliance code?
Phil, as far as I’ve been aware Freddie Mac doesn’t require ANSI. Neither does the VA, USDA nor FHA.
ANSI was a huge mistake for appraisers. Had all the GSE’s invoked it, it would have made sense. It’s also nonsensical to use ANSI derived GLA for a subject property, yet use county property appraiser data that is NOT ANSI compliant. It has and will create far more chaos than it was meant to solve. Say what you do and do what you say and explain. Even with ANSI standards, with complex improvements, it’s rare that two appraisers are going to come up with the same or similar GLA.
Do what you say, say what you do.
Your engagement letter will explain your assignment, and fees
Life is getting ridiculous.
Honestly this is a perfect example of no one understanding what we do!
Who’s your client, what’s the assignments’ goal?
Frequently a beneficiary needs to sell the NOTE which is secured and occupied by a foreigner to the transaction. The owner, and or the occupant of the property would-might be a competitor to buy this note.
The appraiser’s information is difficult to verify including any physical measurement of the property.
Once I had this assignment from a Mortage house in Seatle WA. With no information in, desperation, I knocked on the front door, and found that the recent sale and carry back note had an active FRAUD suit pending. I alerted the client, and the case was canceled. Another case I discovered from friends; a pending fraud initiated by the USJD of 12000+ acres of UN patented lands. Canceled cases are not infrequent, trusting your client very important, knowing your business crucial.
I don’t do desktops. No worries
I agree. I don’t and won’t do them, period.
Can someone please correct me if I am wrong? Since using ANSI standards, I am including the staircase on both levels of above-ground two story floorplans (not the open space). This has resulted in the measured size being larger than model match comps, sometimes by 100 sqft! Obviously, there should not be a size adjustment among model matches, but I’m sure this is resulting in inaccuracies when compared to other slightly larger or smaller floorplans. Any input is welcome.
With Realtors being up to 30% off (trying to make the improvements sound larger than they are and systematically lowering the PGLA) the minor deviation caused by a stairway will not be substantial. Assessor data is another entire story. You won’t believe this but we have some that are very accurate an some WAY off! Fun. Will there be a franchise opportunity in the mowing business model (reference to you know who)? Anyway Dan – yep.
Dan, always use your subjects’ measurements, on the subject and also always note that the sale is listed as a model match and the published size.
Thats defensible, It Ain’t right or wrong its defensible & informative.
Thank you Don. Agreed!
ANSI is stupid, when assessors and builders do not also use that standard. My work around, will work for your scenario Dan. Although if all you’re dealing with is stairs, you can just steal a lower grid line item to adjust that 100 sq ft back, or provide free writing note why you did not adjust for the 100 sq ft of stairs, but that will confuse reviewers. It is always better to adjust for every last sq ft and never round, although many do not agree on that point. I hold to the exact method to keep report error alert fires down with automatic analytical software. You’ll drive up gross just a sliver with a lower line item adjust back approach but if it’s just a hundred sq ft, not a big deal. The real problems are when you run into bi and tri levels and cross comp them against each other or two stories. That’s when you need this work around to avoid irrational net/gross indicators for otherwise unnecessary adjustments. NOW DO AS I SAY AND DO IT MY WAY OR ELSE! That’s Fannie for you in 2022, authoritarian tones. And yes, I too have also seen agents claiming ‘ansi compliant size’, to try and get a leg up on their listing competition, in areas where all public data is not ansi compliant. It’s so cheap and sleezy. Feel bad for buyers whom are standing by to get hoodwinked. And I’m not touching those orders, where relative pricing is already boosted higher than normal range based on fictitious technical size reporting. This is going down exactly as predicted; government intervention solves one problem and creates at least two more new ones.
https://appraisersblogs.com/ansi-measuring-standard-required-by-fannie-mae-in-2022/#comment-34590
Bryan, I may give up on my lawn mowing dreams. It’s probably a better idea to just skip all the hassle and confusion, give up on life in general. I’m hanging on with like four more liters of whiskey then honestly I’m not sure what will happen.
Baggins, thanks for the input. I agree with your thinking on stairs and multi-levels.
Review that entire painful thread if you want to. Lots of good information there but in the end, ANSI is never going to work properly if applied to appraisal valuation industry alone, and nobody else.
Supporters of mandated ANSI are like people steering blind, but somehow they remain convinced that’s the only way to sail. It’s sad really, which is why I came up with an effective work around. Work the report twice, post it pure in pdf, then altered in ansi compliant on xml, zero out your size adjusts, scoot those to lower line items, done. Many more warnings, zero new hard stop errors, and absolutely no net/gross differential between the reports. A lot more work, wasted hours for nothing other than blind following an irrational ANSI standard, but a solution none the less.
When sailing blind.
Be careful of the center board when the boom is swinging
I am comfortable with the arrangements I have to conduct desktops, no worries here. I am also comfortable with my skill and ability to sniff out discrepancies and resolve them. I have spent the summer using cubicasa on my interiors and have been thoroughly impressed. I have no problem asking the Realtor to scan the property for me using this app – there is a video they can watch ahead of time to see how to do it and it is so stupid simple, pretty hard to mess it up. It produces a nice ANSI compliant report. Then you verify, verify, verify – compare to assessor sketch, scour through photos and MLS histories and docs to make sure everything makes sense. And write your CYA disclaimers well. OR – my preferred method is using the professional real estate photography company I have onboarded and “trained” with what my needs are – they provide to me a full interior and exterior 3d virtual/matterport type tour and Lidar scanned floorplan too. That’s the best for really zooming in to all corners. It’s more of an expense, but also more easy and reliable for me and cost is factored into my fee to the client anyway.
I’ve been appraising for 25+ years, and my mother was an appraiser for 15 years before that. I remember typing reports on preprinted forms, gluing polaroid or 35mm photos onto photopages, hand sketching the measurements onto graph paper, making xerox copies of it all, assembling and stapling the reports together and hand delivering them by courier to the bank (or sending them in the snail mail). Don’t even get me started on the 20 pounds of equipment I carried around my neck and on my belt while doing inspections. Every new change in appraisal world during these past 40 years was blasted to be “the death of the profession”. That’s a tired excuse for not being open to adapt, IMO. With the push back I hear from other fellow appraisers on this topic, I’m shocked they aren’t still using an abacus, chisel and stone tablet. LOL.
Do you believe this is a business model that will provide a living for future Appraisers?
I certainly do.
So, $23 per scan add another $10 if you need it in less than 24 hrs. Your signature covers any errors from that app right? Didn’t note how much the professional photographer costs either. Ask Realtors to do it for you? I would love to know what area you work because that ain’t happening in the two states I cover. Can hardly get them to answer any questions let alone take the time to use an app to measure a property.
Was this written by an ad agency working for the app producer? Just asking.
I assumed it was a joke!!
yes, of course it can. Why wouldn’t it? If one adapts and finds a way to make it work, maybe getting creative with envisioning how to capitalize on new methods and new technologies – anything is possible. And no, I do not work for or have any stake in the tech compaines out there that are producing the new tools that us appraisers can utilize. I am an appraiser, full time, raised a family as an appraiser and riding appraisal work into my retirement years. Feeling rather thankful and blessed that I have the means and tools available to continue to earn a respectable living even if and when my body fails me from being able to climb stairs or wade through snow and bushes measuring houses. Honestly, the biggest threat to the appraisal profession is the appraisers themselves. I am training my DIL to become an appraiser (my 5th apprentice now) – and we started right out of the gates with learning each of the 2 halves of bifurcated appraisals. Learning inspection work first as a good beginner’s foot in the door with clients for her, then she’ll move onto the back end where the big money is on learning the art of writing, analysis and appraisals.
Really?
I just completed a full inspection today, the 3rd party floorplan that was in the MLS had some errors. It even showed a 3rd bath that the subject did not have. If you are going to sign off on someone else’s work, make sure your E&O will cover you. If you sign the appraisal report, you are responsible for its content.
Agents are known to just fish out something similar in terms of models, and slap those graphic floorplans or sketches into listings. Appraisers would have to be out of their minds to rely on agent stated sketch data. Those are marketing graphics to help buyers get a general feel, and probably the only person to look at sketches in detail are appraisers. I routinely see MLS listing sketch inclusions for completely different properties or original non altered floor plans from builder data back in the day, which is simply not accurate pertaining to the current home. I’ve even seen them pick sketches from pre listing appraisals which are equally unreliable. Appraisers whom stand back and say; I used this method so that’s the ultimate truth! They’re being stupid. We are supposed to measure and report to the standard of the market at hand, which said standard is laid out by municipal building codes and assessors recognition therein. Otherwise we do not have matching units of measurement and the appraiser is dealing with polluted data.
I’m networking with appraisers looking for default management. This other dude said he’s not taking this one lead but I could have it. A whopping $50-$100 per hybrid appraisal report. Oh yeah, brag about that one.
Bond,
how much do you pay for matterport/3D virtual tours? They usually cost about $200. How much do you charge for desktops? I hear fees range from $75 to $175. And on average, how much time do you spend completing a desktop from start to finish?
I do not do them, but if I did my fee would be the same as a typical URAR. So, it would not be of any benefit for my client to request a DT from me. Saving some time for not having to do the inspection does not cover the increased risk and liability.
One thing I have noticed with the floorplans that are now in the MLS is they do not include the garage nor the exterior dimensions. So, they do not comply with FNMA requirements.
My lender clients who have asked me about the DTs had no idea that they were the ones who were to give the 3rd party report to the appraisers. They were under the impression that somehow the appraisers would just have them. When I told them that they had to get the report and send it to the appraiser they had no idea what I was talking about.
My virtual tour runs $175 and includes the floorplan scan. I spend about 3 hours on average per report, maybe 4 for the tougher ones. Occasionally I get lucky in a cookie cutter neighborhood and can complete in 2 hours. So for the sake of math, lets say my average is 3 hours per report. In my market, the fee for desktop assignment runs the same as standard URAR, $550. SO minus my expense on the 3rd party inspection, I net $375 or roughly $125 per hour. I can easily complete at least 2 per day, or a $750 day. With me doing the inspection myself, I am spending a few hours in the car driving, and inspecting, driving comps etc… and can complete only one report per day on average. So I am actually ahead by $200 per day, on average by doing desktops versus full interiors. In a perfect world of steady enough volume of course. But mathematically, the desktops make more sense to my finances.
The desktops you are hearing of ranging $75 to $175 are the proprietary online and condensed web forms with the inspections provided to you and generally only take about an hour on average to complete. Big difference between those, and the FNMA1004P.
The floorplans in MLS might not comply, but FNMA 1004P gives flexibility in this and provided walls and floorplan layout are there, they are being accepted. ANSI compliance is voluntary. But this is why I like to pull in my own photographer and/or use cubicasa scans – those DO include exterior dimensions and decks, garages etc.. (Matterport brand name might not, my photo contractor uses a competitor version that is LIKE matterport but gives more detail and is ANSI compliant )
Bond, if the 1004P desktops cost as much as the 1004 with the appraiser doing a full inspection, why would your client want a desktop and have you rely on a photographer to inspect the property, provide floor plan, photos, measurements, etc.? What am I missing?
Xpert exactly. Just went online and saw fee for a 1004P hybrid appraisal $200-$275.
“Fannie also has a name for its new “hybrid” desktop appraisal, the 1004P. This would be a desktop appraisal that is performed by a licensed appraiser after a property data collector has inspected and reported on the property in question.”
So, big difference huh?
Also, you the appraiser do not get to pick the property data collector.
Still not buying this story!
On the client’s end, a shorter turn around time I imagine. Plus I do provide the link for the virtual tour so they can see the home in more detail themselves. In my rural area- there is an extreme shortage of appraisers. I am the only one left in a couple of counties. Maybe 2 or 3 left in a few others. I turn away more orders than I take in. This is a good option to lighten that workload a bit – there are only so many hours in a day. The other option they would have is to pull in appraisers from out of area. To me, having this desktop by a seasoned and detail oriented local appraiser over a potentially error fraught appraisal from an out of area appraiser desperate for any work they can get is a no brainer. To be sure, there is a lot of confusion and misinformation out there on desktop versus hybrid, 1004p versus proprietary web based short forms . Some clients provide the data at a lessor fee to the appraiser, some leave it to the appraiser to obtain the data for a higher fee. Fees will vary by market, and ultimately it’s up to us as appraisers to hold the line on what we will accept fee-wise.
And there is the problem. Being the only appraiser in your rural area, I’m puzzled as to why you are only charging $550 for a URAR!
Hope you are aware that you are responsible and liable for data collected by third parties. IMHO, your fee does not cover the increased risk and liability.
He’s well aware of how to advocate for amc’s.
Don’t believe everything you read on the internet.
Perhaps we should not do any more floor plans. You know you may not use a person’s photographs without permission due to copyright laws. Well, in a case that went to the 8th District. ” Designworks Homes, Inc. v. Columbia House of Brokers Realty, Inc., No. 19-3608 (8th Cir. 2021) Charles James and Designworks filed suit against real estate companies, as well as their affiliates and agents, claiming that defendants infringed their copyrights when they created and published certain floorplans without authorization. The Eighth Court upheld the infringement. When you next draw a floor plan, make sure it is not under a copyright because when you send it as your work, for FNMA you may be infringing on the designer’s copyright without his permission. Its a slippery slope we traverse. On appeal the Supreme Court would not hear the case. So beware!
The Sky Is Falling, the sky is falling, the sky is falling.
The slippery slope has slid, letting the sky fall down
I’m going back to forms and worms and tracing paper then, that settles it.
Good thing independent appraisers are neither affiliates nor agents.
It’s hard to get more juice from a lemon already squeezed dry.
Appraisers should voluntarily work at cost. Don’t worry about feeding your family. Rather do it for the applicant. Literally that’s words spoken by Danny Wiley to me 10 years ago. Is Danny doing what now. He still with Freddie? Words stated by Danny to me were when he was with LSI. Later Sold. After hiring 50 appraisers. 6 months latter appriaser were well what Danny all let go? Innovation. Dan you have done nothing but ruin this occupation. But you did well didnt you.
Pure insanity on every level. I don’t do desktops or bifurcated appraisals. Lunacy and liability!
Kathy, what do you make of the counter argument: You’re protected by limiting conditions, extra ordinary assumptions, and the clients knowing the appraiser has not inspected and they don’t expect all that much detail.
Just asking the question sounds silly but what is your rebuttal to those counter arguments? Thanks.
There are too many moving parts in desktops and hybrids products. I could do the full appraisal faster, and more accurately than waiting for some 3rd party uber driver to measure and some burned out 70 y/o realtor to get me the information that most likely will be flawed and inaccurate.
If doing desktops/hybrids is your jam, then by all means….
Remember that your liability just went up exponentially, and your slowly killing the appraisal profession in the name of ‘technology’ and expediency for people and clients that don’t like you – all for a lower fee.
I totally agree but…..You know what we haven’t done as a Profession? Came up with a better way. It has always been dictated to us and we just fall in. How about WE form a coalition and present a faster more economical method? It would not be that difficult. I have come to realize it is not the fees we charge, it is the time we take. The time is caused by many factors, some outside of our control, but if we presented a method we were comfortable with that could be completed in a timely fashion the pressure would be off to eliminate us (which is the goal if you haven’t realized it yet). So here is a start – put the responsibility for providing all of the information required to perform an appraisal back on the people that are supposed to do it. FANNIE states it is the lender’s responsibility period. We spend a couple days begging for Condo Quest info or calling builders for prints and specs or getting an order for a final that states “Call the builder and verify completion and ask for pertinent comparables and verify final sales price” and and and. We are doing everyone else’s job and being chastised for taking too long! How about an order for a final with the CO attached. Instead of three calls to the builder and rearranging your schedule the Lender or AMC do their job first. BOOM – saved a couple days and we haven’t re-written the forms yet. Neighborhood data is tracked by so many entities (MSA, census track, zip code) we don’t need to put it in a report. 1004MC – GONE (really gone – many still insist). Comparable photos NOT required but if you feel compelled go ahead and do it (your decision by report). Remember why we exist – Public trust in the process and collateral information – that’s it. We are just one small piece of the puzzle. Trust me – ability to repay is WAY more important! I could go on but i have to get to work. One other thing – this Blog is the same ten people responding. Where is everyone else?
In my market it takes about 6 weeks to close a loan. The MLS shows the contract and close dates – purdy straightforward to figure out ( even I can figure it out). I’m not an expert or anything on process improvement, but is it possible that we are looking in the wrong place to improve efficiency?
Perception is everything.
Ability to pay doesn’t mean anything when the government pays, and Investor trust is a more important ingredient, politician’s trust is questionable according to the bankers.
Why would anyone trust an Appraiser, other for that of the quality and verifiability of the report?
What?
This sounds very much like people who have no clue what we do or what an appraisal is are the ones making the rules. Yet another reason I won’t do desktops.
To all the appraisers doing these “New floor plan desktops”; I want to thank you for taking a razor blade to our profession and slitting collectively, all of our throats. You’re rubber stamping properties and lets admit it; properties you KNOW NOTHING ABOUT. YOU must rely upon “MANY” unknown factors, just because you make the extra-ordinary assumption that what you believe you were provided by a third party, forth, fifth party is true but if found to be false you’re exonerated. You’ll have your eyes opened really quick the moment a bank suffers loss. With all the AVM’S, now this; again, YOU’RE cutting the very throat of our profession. In my NOT SO HUMBLE OPINION.
Update on this thread: I requested that my pmi be removed from my loan by my lender, Penneymac. They charged me $150 for some type of valuation product to determine if I had 20% equity. Someone contacted me within about 3 days to take pictures (interior and exterior) I asked if they were an appraiser; they said they were a broker. It has been two full weeks now and have heard nothing. My appraisal turn time is only about a week even during the busy time. That bifurcation thing seems to be saving lots of time. Lol
Missing the IVPI proposal yet?
https://www.workingre.com/wp-content/uploads/2013/08/IVPI-Proposalfinal.pdf
Establish and maintain adherence to the Home Valuation Code of Conduct:
1. The approved IVPI Appraiser must personally inspect the interior and exterior of the
subject property; virtual inspections are not permissible (viewing photos, videos, etc).
2. Only the IVPI approved Appraiser can perform the appraisal; the only exceptions being a
trainee, or their equivalent, working under the IVPI Appraiser’s direct personal
supervision. Unapproved Appraisers cannot inspect the subject property and sales
independently.
3. Responsible for adhering to the current edition of the GSEs appraisal policies.
4. Certifies to GSE?policy adherence in the appraisal reports.
5. Identifies the client and the client’s “target” lender in the appraisal report.
6. Appraisers to add in additional items required in USPAP for Summary Appraisal Reports
(i.e., Highest and Best Use analysis (HBU), exposure time analysis, the reasoning for
excluding approaches or methodology that would normally be expected by peers or
other lenders, etc.)
7. Appraisers to model their appraisal reports per GSEs approved examples to the extent
possible within their geographic region. When GSEs provide suggested verbiage
Appraisers should use it to the extent its applicable, etc.
8. Only individual Appraisers are approved.
Same experience here. Bifurcated appraisals are certainly not ordered to save time. Why are they used???
Save money for the bank and the AMC. They charge full fee and give “YOU” peanuts.
Also due to convenience of request ordering. There is an entire network of vendor services out there and some are lower priced than others. Nearly everything on this site tracks back to such service managers. Being these companies are truly clueless as to what the appraiser provides and the difference between valuation services and broker price opinions, all they see is the lower priced vendor cost of the realty agent, so that’s what they go with. GSE managers whom allowed such work arounds to exclude the appraiser and in turn allow originators to misrepresent a price opinion as a valuation service are just as much to blame.
https://propertyvendors.com/
Like for real, you could get paid more to be a professional lawn mower than to be an appraiser these days. You’ll be back in line compared to full service vendors though, as they use lawn mows as the hook to provide additional services to really beef up their income footprint and staffing needs. The website is chalked full of opportunists whom hire ignorant people to perform the work they could otherwise tap into themselves directly if they simply knew how to market themselves as a 1099 field vendor to the manager companies directly. I looked into this for over a year in great detail, including developing an equipment list, much of which is out there ready made just to attract new industry servicing members. I just could not get past the hygiene challenges, many requests are truly dirty jobs. That and posting foreclosure notices on peoples doors, just not my cup of tea I suppose. Appraisers have options to step back from appraisal, get paid more for no liability efforts, hire help, access hundreds of new companies desperate in need for service vendors. When one single lawn mowing job pays more than a hybrid or desktop appraisal… The photo takers simple inspection people are literally bottom of the service pyramid, so just fyi, that’s whom the appraisal modernization pundits claim are reliable data sources that appraisers can rely on for professional liability protection and property information. Have phone, will travel. Third party property inspectors get $8 a pop, for real, it’s a fact I verified multiple times across multiple company contacts in just the past year. Licensed agents may perform these for $25 to $50, sometimes slightly more. And that’s where the new reduced appraisal hybrid fees come from, direct relationships to the realty vendors liability free work costs. It’s important for appraisers to understand if they accept this work for those fees, they’ve lost all control over both their own liability, and their own fee schedules.
Right ON, Every request should receive a potential contract with a price list and a method of ACCEPTABLE payment.
We all know what lenders need, but not what they will accept. If they are the user, its their choice
Mark had a working RE interview, sort of along those lines. It’s an interesting read.
https://www.workingre.com/fhfa-slows-bifurcated-appraisals/