Category: Appraisal News

Truth-in-Lending Act - RESPA Ingetraged Disclosure - TRID Coming Soon Imagecredit Flickr - Dennis Skley 1

TRID Coming Soon Your Way

Appraisers and others, TRID is coming to mortgage lending on Aug. 1, 2015. In case you have not been paying attention to new aspects surrounding your typical measuring buildings and writing reports on a daily basis, TRID is set to become a major change in the mortgage lending process. TRID is the acronym for the ‘Truth-in-Lending Act/RESPA Integrated Disclosure’ process that applies to every mortgage loan as of 8/01/15.  It was part of the Dodd-Frank Law, with power given to the CFPB agency to devise the rules, forms and process. The intent is to consolidate and simplify processes that have...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisers News / CFPB

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Residential Appraisers Dos and Don’ts

Residential appraisers are a critical piece in the puzzle that is determining a property’s “true” value. But in today’s market, the role they play is more pivotal than ever. When every dollar counts (as the players of the game may still be licking their wounds from the oh too recent housing crisis) sellers want to be able to get the highest value possible for their property and buyers certainly do not want to overpay for a home, so working with an appraiser who is trained to perform services in an ethical and professional manner with rich knowledge of the market...

Appraisal / Appraisal News / Appraisers News / Uniform Standards of Professional Appraisal Practice / USPAP

Laxer Restrictions - Residential Real Estate Industry & its lobbying groups pushing for looser restrictions on real estate lending - Imagecredit Flickr - Shawn Rossi 8

Laxer Restrictions? Not Again!

Skinning appraisers alive and blaming them for everything except the disappearance of Jimmy Hoffa and now pushing for looser restrictions! With the overall economy improving and with unemployment dropping back to more manageable levels, it was only a matter of time before the residential real estate industry (builders, bankers, mortgage lenders, Fannie Mae, Freddie Mac and Wall Street) and its lobbying groups and trade associations popped up and asked for Congress and federal regulators to reduce or end many of the restrictions placed on the industry after it gorged itself on the U.S. economy and left the table with only...

Appraisal / Appraisal News / Appraisers News / E&O / Errors & Omissions / Fannie Mae - Freddie Mac

An appraisal is not THE opinion of value - Imagecredit Flickr - takomabibelot 0

An Appraisal is not THE Opinion of Value

My opinion of value is well-supported… Some of you are going to need to hang up your ego hats for this one. You know who you are. I see you hanging out on the online appraisal forums. You are the ones who do not just have an opinion, but THE opinion. Don’t worry, I will let you put it back on before I am done. As appraisers, we are often asked a question similar to this, “Why can two professionals appraise the same property, yet come up with two different values?” It is an excellent question, and one that has...

Appraisal / Appraisal News / Appraisers News

FHA Appraisers Increased Liability & Responsibilty with New FHA Requirements 27

FHA Appraisers Increased Liability with New Requirements

FHA Appraisers Increased Liability & Responsibility with New FHA Requirements Excerpt New FHA Requirements Put More Responsibility and More Liability on FHA Appraisers After reviewing the new HUD handbook, my overall conclusion is that there were not many changes to the overall requirements other than the word MUST. The prior handbook was a list of items that should be completed and verified whereas the updated HUD handbook clearly states that the properties MUST meet these items and the appraiser MUST verify the items in question. The following is a list of FHA requirements that MUST be completed and verified by the appraiser....

AAREA / Appraisal / Appraisal News / Appraisal Organizations / Appraisers News / Arizona Association of Real Estate Appraisers

Protect Yourself with a Limitation of Liability Clause . Limitation of liability clauses are contractual provisions used to cap the liability of a party to a contract or transaction. - Imagecredit Flickr - Tax Credits 3

Protect Yourself with a Limitation of Liability Clause

Set Your Limits and Protect Yourself with a Limitation of Liability Clause In a recent case on the West Coast, a certified general appraiser was sued for professional negligence by a commercial lender. The lender had made a high-interest, short-term loan to an  investor/developer for the purchase of a large parcel of land that the borrower planned to subdivide and sell as mini-ranches. The property was appraised for approximately $5 million in 2007, and the lender had loaned $3.2 million. Within months after closing, the borrower’s project began sputtering because of the financial crisis, and by early 2009, the borrower was in default. The property sold at...

Appraisal / Appraisal News / Appraisers News / E&O / Errors & Omissions

Unpermitted additions assignment condition 1

Unpermitted Additions “Zombie” Assignment Condition

Unpermitted Additions This is a “zombie” assignment condition that seems to never die. Let’s agree that unpermitted means something was constructed without a required written permit. There are plenty of jurisdictions that don’t issue permits because the permit process doesn’t exist. The assignment condition goes something like this: The appraiser is not to include any GLA from any unpermitted additions unless they use comparables that have similar unpermitted additions. Here’s what Fannie Mae stated in their September 2014 FAQs: If the subject property features an unpermitted addition, can the square footage of the unpermitted addition be included in the total gross living area reported on the appraisal report? If the appraiser has identified an addition(s) that does...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisal Organizations / Appraisers News

Appraiser soon to be jailbird - convicted of a felony for incorrectly reporting the last sale date of property in an appraisal used to defraud a lender in a mortgage fraud scheme 4

Appraiser Soon to be Jailbird for Fraud

In a million dollar mortgage fraud scheme Appraisers, An appraiser in NY state has been convicted of a FELONY for incorrectly reporting the last sale date of a subject property in an appraisal report, which was used to defraud a lender in a million dollar mortgage fraud scheme. You can read the full story here. Per the info in the story: “Essig is the owner and operator of Essig Appraisals, an appraisal company that specialized in residential appraisals. According to statements made in Court today during Essig’s plea, Essig admitted that he made a false entry in an appraisal that...

Appraisal / Appraisal News / Appraisal Quality Monitoring / Appraisers News / AQM / Collateral Underwriter

Appraisers Blacklisted 24

Blacklisting Lawsuit Continues

Appraiser Michael J. McSwain filed a lawsuit against Yadkin Valley Bank and the appraisal management company (AMC) StreetLinks Lender Solutions, alleging that he was retaliated against for failing to reach targeted values.

According to the suit, McSwain performed two appraisals for StreetLinks in late 2012, on behalf of Yadkin Valley Bank, both of which failed to “meet value.” The suit cites explicit emails from the branch manager at Yadkin which state:

“StreetLinks has sent out a BUTCHER on two of my last refis [sic] … make sure he is not sent out in our county and make sure he is not on the approval list…I thought I would let him do these two just to see. NOW THE DEALS ARE DEAD.”

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisal Organizations / Appraisers News

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What Should an Appraiser Do?

Burdensome indemnity language required by a lender or AMC Appraisers are often required to sign lengthy contracts to obtain assignments from lenders or Appraisal Management Companies. These contracts outline the scope of work, when the assignment is due, how to transmit reports and other items that require review and understanding. Once the contract is formalized, the appraiser is then legally required to comply with its’ provisions. One important and often troublesome requirement is the Indemnity Provision. The concept of indemnity means “security against hurt, loss or damage”. Through indemnity, one party can shift the responsibility of loss to another party...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisers News / E&O

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