Category: Appraisal

AMC License Bonds 1

AMC License Bonds. Are They Working?

Are AMC Bonds Working? Current AMC Bond Requirements Eighteen states now require AMCs to carry surety bonds to be properly registered to operate in those states. The required bond amounts vary from $10,000 in New Mexico to $100,000 in Washington.  A list at the end of this post shows the required bond amounts in each state. Are AMC Bonds Working? The requirement for AMCs to carry bonds serves two purposes. First, the bond assures that if an AMC fails to comply with its financial obligations under a state’s AMC law, there will be funds available up to the limit of the bond...

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

Borrowers to Refinance with No Appraisals 3

Knowing When to Say NO

I wish I never took that assignment One comment often encountered when investigating a complaint is “I wish I never took that assignment”. Another is “I should have walked away when I saw the property.” How can you avoid that uneasy feeling when completing an assignment? If this is a typical residential mortgage transaction, things may go fairly smoothly. If the assignment involves appraising a property in a divorce, estate, tax appeal, or anything that might end up in litigation, you should meet with your client to assess whether there could be trouble ahead. One way to avoid this type of surprise is to not consider assignments as being routine. Each assignment regardless of purpose or intent has...

Appraisal / Appraisal News / Appraisal Organizations / Appraisers News / NCAB / North Carolina Appraisal Board

Review Appraisers Need to be the Voice of Reason 9

Will the Madness Ever Stop???

Review Appraisers Need to be the Voice of Reason Having spent the day commiserating with my fellow appraisers, I have to admit the policies and procedures of most reviewers, underwriters and lenders have finally crossed the line from insane to inexplicable. It was bad enough, 23 years ago when an appraiser was asked to document two independent sources of data or to provide interior photographs to show each room. Then not to long ago some appraisal management companies started to believe that when FHA asked for two photos to show an oblique view, they actually meant the appraiser had to...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisers News / Federal Housing Administration

Appraisers E&O FDIC Exclusions - Image courtesy of Stuart Miles / FreeDigitalPhotos.net 3

FDIC Exclusions in Appraiser E&O Policies

Many appraisers don’t know about or don’t understand the new FDIC and “regulatory agency” exclusions found in many appraiser E&O policies. Why is it relevant to know if your policy has an FDIC or regulatory agency exclusion of some sort? The main reason is because the FDIC sues appraisers for professional negligence — such lawsuits are discussed in prior posts: here and here. How do you determine if a policy being offered to you contains an FDIC exclusion? First, no policy sold by LIA in its appraiser E&O program contains any FDIC or similar regulatory agency exclusion. If you are...

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

Alternative valuation products 1

Alternative Valuation Products & USPAP

Alternative Valuation Products and the Uniform Standards of Professional Appraisal Practice The Appraisal Foundation has drafted a white paper on Alternative Valuation Products and the Uniform Standards of Professional Appraisal Practice (USPAP). The white paper is intended to provide information to assist appraisers, users of appraisal services, and others, with a greater understanding of Alternative Valuation Products and their use in the marketplace. The paper also attempts to view these products in light of an appraiser’s USPAP obligations. All interested parties are encouraged to comment in writing before the deadline of December 31, 2013. Send comments to TA…@appraisalfoundation.org. Introduction In...

Appraisal / Appraisal News / Appraisal Organizations / Appraisers News / Automated Valuation Models / AVM

Proposed Amendments to the Sentencing Guidelines in Mortgage Fraud Cases 2

Appraisal Fraud – Stay Vigilant

Remaining Vigilant Against Appraisal Fraud While recent studies show that appraisal fraud is on the decline, the nation’s largest professional association of real estate appraisers still cautions lenders and other real estate industry professionals to be on the lookout for suspicious activity. According to CoreLogic’s Second Quarter Mortgage Fraud Report, the risk of mortgage fraud decreased during the second quarter with valuation fraud showing the biggest improvement, falling 7.1 percent between the first and second quarters of the year. However, fraud has escalated in cases where potential borrowers attempt to deceive lenders about their incomes. The report showed that an...

AI / AMC / Appraisal / Appraisal Institute / Appraisal Management Companies / Appraisal News

4

Have You Been Blacklisted by Lender?

We often receive calls from appraisers who have been blacklisted by a lender they do no direct appraisal work for. Typically, the story is the same. They are being dropped from an AMC panel that has given them a lot of business because the AMC found out one of the bigger secondary market loan buyers/lenders has blacklisted the appraiser. This is a lender they do not work for and/or haven’t done any work for in years. The blacklisting is based on some alleged issue with an appraisal done for another client and usually involves a review of the old appraisal...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisal Organizations / Appraisal Subcommittee

How should you handle an angry borrower at a re-inspection 0

How to Handle an Angry Borrower at a Re-inspection

Angry borrower… please don’t shoot! We’ve all been there. We do an appraisal inspection and find health and safety issues that must be mentioned in the appraisal. A few weeks later, we receive an engagement letter requesting a re-inspection. The appointment is set and the borrowers confirm that all repairs have been made to a satisfactory level. The appointed time arrives and you drive to the property in question. Before you even get out of your vehicle, you can tell that the health and safety issues have been minimally addressed but certainly not to the level that would allow for...

Appraisal / Appraisal News / Appraisers News / Federal Housing Administration / FHA / The US Department of Veterans Affairs

The Appraisal Complaint National Hotline 2

The Appraisal Complaint National Hotline

Jim Park, the Executive Director at the Appraisal Subcommittee (ASC), gave an informative presentation at Valuation Expo this past June. In this session, Jim reviewed the functions and oversight duties of the ASC and current status and regulatory issues with the States. One of the more interesting topics covered in Jim’s presentation regarded the Appraisal Complaint National Hotline, which was established in accordance with the Dodd-Frank Act, put into law July of 2010. TThe National Hotline, which began taking referrals in March of 2013, acts only as a facilitator for complaints. In other words, the National Hotline identifies the Agency(s)...

AMC / Appraisal / Appraisal Management Companies / Appraisal News / Appraisal Organizations / Appraisal Subcommittee

Statute of Limitations for Appraisers 2

Statute of Limitations Against an Appraiser

The Statute of Limitations for a Claim Against an Appraiser Why You Should Keep Your Workfile for 7 to 8 Years In 2013, many lawsuits against both residential and commercial appraisers continue to relate to appraisals performed years ago at the peak of the real estate price bubble, 2005 to mid-2008. These lawsuits are filed by borrowers, lenders, investors or the FDIC and typically allege that an appraiser’s inflated value resulted in the plaintiff borrowing, paying or loaning too much money.  The plaintiff blames its loss on the appraiser and sues for damages. When reporting a claim like this to...

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

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