Neighborhood is broad and general in nature… When examining appraisal reports, it is commonly noted that the Neighborhood section of the 1004 appraisal report contains data for sales of properties that are comparable and competing to the subject, rather than for sales of all homes of the same category (i.e., single family detached). Professional appraisal reference works, such as Appraising Residential Properties, 4th Edition (published by Appraisal Institute) address the differences between a “neighborhood” and a “market area.” Further, various Fannie Mae selling guides and announcements, and the HUD 4150.2 handbook contain guidance for appraisers regarding the analysis of neighborhood...
Fed Report Scrutinizes Appraisal Processes The Government Accountability Office released a report June 28 that scrutinized real estate valuations in the wake of the recent mortgage crisis. The report, Residential Appraisals — Regulators Should Take Actions to Strengthen Appraisal Oversight, was produced using data from Fannie Mae, Freddie Mac and five of the biggest mortgage lenders. The report revealed that valuations received through broker price opinions and automated valuation models take less time and are less costly than traditional appraisal reports, but traditional appraisal reports are still mandated for almost all first-lien residential loan originations due to their greater reliability....
Gov. Bob McDonnell signed legislation (H.B. 408) April 11 that made Virginia the 10th state to enact new regulations regarding the operation of appraisal management companies. The new law will become effective July 1. Under the law, AMCs operating in Virginia will be prohibited from influencing or attempting to influence the development, reporting, result or review of a real estate appraisal through coercion, extortion or collusion by withholding or threatening to withhold timely payment or future business from an appraiser. AMCs also will be prohibited from: removing an appraiser from an AMC’s panel without first giving written notice to the...
The Appraisal Institute and the American Society of Farm Managers and Rural Appraisers reiterated their support of separating appraisal and appraisal management company fees on mortgage disclosure forms June 20 in Congressional testimony. The organizations originally voiced support when drafts of the Consumer Financial Protection Bureau’s proposed Consumer Disclosure Form were released in February. AI and ASFMRA again expressed their support in written testimony on “Mortgage Disclosures: How Do We Cut Red Tape for Consumers and Small Businesses” before the House Committee on Financial Services’ Subcommittee on Insurance, Housing and Community Opportunity. The organizations expressed support of clear disclosure of...
NAIHP: “Congressional Subcommittee REFUSES Small Business Brokers and Appraisers a Seat at the Table” For the second time in a week, the Subcommittee on Insurance, Housing and Community Opportunity, Chaired by Rep. Judy Biggert (R-Illinois), refused small business housing professionals the right to be represented during Congressional testimony. On June 20th, the Subcommittee held a hearing entitled: “Mortgage Disclosures: How Do We Cut Red Tape for Consumers and Small Businesses?” Although, Banks were represented three times on the panel, Brokers were intentionally excluded. NAIHP argued to represent the industry, but was refused because the panel was full. On June 28th,...
“Appraisal Oversight: The Regulatory Impact on Consumers and Businesses” Hearing Frank Gregoire, a a state-certified residential appraiser in Florida, will testify on behalf of the National Association of REALTORS® (NAR) before the House Financial Services Committee’s Insurance, Housing and Community Opportunity Subcommittee on Thursday, June 28th. The hearing will focus on the appraisal industry and regulations impacting consumers and businesses. Mr. Gregoire holds the RAA Designation, is a two-time Chair of NAR’s Appraisal Committee, and has been active in NAR’s public policy committees since the early 1990s. Mr. Gregoire is on Panel II of the hearing. WITNESS LIST Panel I...
Several Canadian banks have reconsidered their appraisal strategies due to increased concern about the accuracy of property values in a market with the potential to overheat, the Globe and Mail reported June 13. Canadian lenders currently use such valuation methods as full appraisals, drive-by appraisals and databases to determine market value. Banks are emphasizing on-site visits, particularly for properties over a certain price threshold or in rural areas, the Globe and Mail reported. They also are more carefully evaluating who performs appraisals. The banks hope that increased diligence will result in more accurate values in light of concerns about an...
AppraiserLoft Fined $855,000 for Failing to Pay Arizona Appraisers A Phoenix judge fined the defunct appraisal management company AppraiserLoft $855,000 for failing to pay Arizona appraisers at least 171 times within the past 18 months, the San Diego Union-Tribune reported June 12. The San Diego-based AppraiserLoft has been the subject of numerous non-payment and late-payment claims from appraisers, former employees, advertisers and other parties before shutting its doors in October. The AMC allegedly owes more than $3 million in property valuation invoices. In the Arizona case, administrative law judge Diane Mihalsky found that the AMC failed to pay Arizona appraisers...
Analyzing of market trends The nation’s largest professional association of real estate appraisers published guidance June 4 to help appraisers analyze market trends. The Appraisal Institute’s “Guide Note 12: Analyzing Market Trends” addresses to what extent appraisers are responsible for recognizing changes in market conditions, and what steps appraisers must take to ensure due diligence is done regarding the analysis of market trends. The Guide Note states, “Analyzing current and anticipated market conditions is more complicated – and more critical – when a market is rapidly changing, either upward or downward.” Adequate market analysis must be completed before highest and...
Nearly one hundred members of the Appraisal Institute went to Capitol Hill May 23 to urge Congress to act on three bills that could significantly impact the valuation profession. Attendees of AI’s annual Leadership Development and Advisory Council, held May 22-24 in Washington, D.C., lobbied lawmakers and their staffs on S. 3047, the Expanding Homeowners Refinancing Act; H.B. 3461/S. 2160, the Financial Institutions Examination Fairness and Reform Act; and S. 3085, the Responsible Homeowner Refinancing Act of 2012. S. 3047 builds on President Obama’s proposal — announced during his 2012 State of the Union address — that home loans not...
