There is a special kind of stupid in Texas. It is called the herd mentality, and there are a lot of copycats there. Being a strong Republican state, Texas is a leader in the way to be “one up” on being the “most” conservative, reflecting the influence of the Bible belt which encourages conformity and when I hear Texas politicians speak, they rarely make any sense; it is much about bravado and false pretenses, like a Southern Belle flitting her eyelashes while her relatives are lynching a Black man who picked the cotton for the clothes she wears, but they are sometimes clueless. I have relatives in Texas I can’t speak to because they are rabidly biased against anyone from California because their dense heads somehow perceive all of us women being hookers and men being gangsters (thanks to tv and movies).

Fannie and Freddie are private investor groups, not mortgage companies or banks; they are there to package mortgages and resell them. The quality of the product is very low as experienced in their mismanagement and “crookery” that led up to the 2008 world financial crisis, also perpetrated in concert with Wall Street brokers, derivatives, and banks who crossed the line between being a lender and investor (ending the Glass Steagall Act meant to protect the public trust after the Great Depression).

So why are the gamblers still running things? None of the people responsible went to prison and many are still running things, or have been rewarded by high positions in government. Fannie and Freddie were not really regulated because they have too much power. They have invaded our appraisal profession because they don’t have any respect for anyone who gets in the way of their profit-making schemes, many of which are not sound. I remember after the 2008 bailout Interthinx reviewed the original appraisals on homes appraised in the run up to the crisis, and most of the people at Interthinx were Indian or Pakistani computer nerds, and none of the company’s owners and directors had any qualifications for appraisal related work. They employed the appraisers who worked for IndyMac and Countrywide to “review” the original appraisals to determine the responsible parties involved in the rampant mortgage fraud leading up to the bailout. Now they are engineering the next bailout and they can blame the appraisers again, and now their “modernization” actually is dumbing down the process of valuation and breaking it into tasks so they will function only a rubber stamp using the lowest qualified appraisers at the cheapest cost as they are going to make those loans anyway. Homeowners want cheap loans. When the homeowner needs the money they want the highest value, not thinking the objective, ethical, well-trained and licensed and insured appraiser could protect them from over-encumbering their biggest asset by giving an honest, supportable opinion. People who refi all the time are playing a game thinking they are out-smarting their bank and getting away with a high value while the lender is taking that house back if the homeowner can’t pay the mortgage anymore; and fake equity falls like a house of cards. This profits investors who buy them for less than their former “value” or when everyone is over leveraged, then they convert to rentals, and more people are out of the home ownership position. There are so many homeless in this country and prices are so high that young couples postpone marriage, starting a family and other life experiences because they owe too much on their student loans and can’t afford to buy a house because there is not much in affordable rentals where one could save for those big ticket items. So while homeowners or borrowers may be sold an appraisal waiver, they will have to pay for it while getting absolutely no protection, or the one objective person to study and report value on a big purchase. While some Fannie guy like the joker Coletrane says this property doesn’t need an appraisal for whatever bs reason he can come up with. My impression is that he is of the herd mentality at Fannie and that he wouldn’t know the truth if it hit him in the head because he is a parrot, repeating what he heard from what he considers a good source- none of his ideas are new, just salesman stuff!

Someone asked what does Trump have to do with it? He is a slick salesman and the ultimate liar. None of us would want to appraise any of his property as the pressure to deliver on an exaggerated value would be so extreme it would give you a whiplash and if you didn’t please him you would wind up with him accusing you of ignorance. He hates experts! That’s why he appointed an idiot savant to HUD, so he could develop more projects in the new “opportunity zones” designed to benefit he and his cronies.

The republicans are now a cartel and everybody who doesn’t like Trump gets an insulting nickname. He is obviously racist and is separating children from their parents if they dare come here for asylum. People have migrated over all of history to find better living conditions and we are causing more refugees by war, and he capitalizes on people’s fear they are taking our jobs; corporations run by greedy punks who don’t like laws or regulations are taking our jobs in the name of technology, and it is a bad thing. Appraisals have not gotten better with big data, just more artificial intelligence instead of human element. I know personally from research into luxury homes that Trump is money laundering (Palm Beach home he bought for $41 million held for 2 years sold to Russian fertilizer magnate for $94 million and neither of them lived in it). Later that home was torn down (mold, bad design), so yes, Texas culture, New York Culture, or the culture of greed is infiltrating into our profession, in favor of those who justify greed.

These people are the problem, not appraisers doing their jobs. Appraisers are judges of data, imitating the actions of the market. People don’t buy houses by proving adjustments for differences on a micro level, or performing regression analyses, so why should we accept Zillow and artificial intelligence when we are conducting an analysis of the behavior of people? Resist the so-called modernization of appraisal and use the principles and techniques that traditional appraisal theory developed for guidelines to good judgement, while remaining a neutral third party to the transaction of a real estate deal. If it is based on salesmanship or lies, it is just manipulation. Who expects the nerdy programmer to understand what we know, and what we learn with each appraisal which is that everything in real estate is local, and there are different strokes for different folks. It is our job to understand participants’ expectations and there is always a range when we are reporting value, but hopefully we reason the opinion by solid facts, correct application of the principles and reconciliation of approaches, not convoluted programming by people living in the digital world or the latest gadget someone is selling us to make our job easier. This is not a science, it is an art in need of understanding human behavior, recognized by patterns in an environment of trends that are constantly changing.

Don’t rely upon Fannie or Freddie to agree with USPAP and don’t think the AMC isn’t exploiting you, your license, your profession or your time; these people are just blood sucking leeches feeding off appraisers because they just can’t stand that we are very independent, based on the nature of our need to uphold the public trust.

What does Trump have to do with this discussion?

Thank you Baggins!!!

The fact that they worked for FANNIE and that is how they feel says it all. FANNIE doesn’t even get appraisals on the REOs they are selling so now you know. On the bifurcated issue – we will once again be our own worse enemies. Let’s race to the bottom.

Are all appraisers from Texas this stupid???

You spent 35 years inside the most corrupt financial institution in the history of the US and we’re supposed to listen to your opinions???

Nobody is whining about anything. Stop antagonizing us. You need to enjoy your retirement and go play some checkers at the Barber Shop.

Captain, Road Prison 36:

What we’ve got here is failure to communicate. Some men you just can’t reach. So you get what we had here last week, which is the way he wants it; well, he gets it. I don’t like it any more than you men.

Cool Hand Luke

These problems with the gse’s, mortgage markets, and quality of service concerns have carried through multiple administrations on both sides of the isle.

The economy is recovering. You’re right to not believe the hype though. Those dollars keep rolling off the printing press day and night. Next comes a dramatic increase in costs of goods and services. Inflation is here.

That’s why appraisers are their own best advocates. I did try to share the burden with amc’s myself. They never achieved a position for me, their panel appraiser, anywhere near equivalent what I was able to achieve directly, without their ‘assistance’. That’s a pretty simple consideration and business decision right? Whom best deserves my time, because they best supported my hopeful business plans.

related;
https://www.pionline.com/article/20180709/PRINT/180709891/fannie-mae-freddie-mac-privatization-would-affect-many-real-estate-portfolios

https://www.washingtonexaminer.com/opinion/op-eds/privatize-freddie-mac-and-fannie-mae

I think a good way to explain what’s going on here is to recognize that appraisers are primarily interested in their livelihoods, steeped in their own positions, falling back on the micro and individual scale of observation, measurement, and objective reasoning.

We’re talking about fundamental changes to a 5 trillion dollar mortgage market, falling investor confidence, desperate radical process changes to fund a swift and unexpected capitalization effort, likely removing monopoly status of gse’s when the true free market of non federally guaranteed lenders may one day be able to compete for regular financed borrowers business again.

This is so big, so huge. Let’s think about this for a second. Bolster checks and balances for a 5 trillion dollar mortgage market, or remove those and go full throttle no restriction and see what happens. What could go wrong? I’m nowhere near retirement but do only have 10 years to go on my mortgage note… If appraisers don’t see this coming down the tracks, they’re blind. Why they continue to provide services for the companies fueling these radical changes is beyond me. I go with the lenders whom don’t use middle management and are not short cutting traditional process. Support the good guys. It’s not rocket science.

Wayne Coltrane. You’re out of touch with reality and obviously trying to ingratiate yourself with AMC’s. Probably voted for Trump and actually think the economy is improving.

Wayne, in response to your assertion that appraisals have nothing to do with the public trust, I give you the preamble to USPAP (This is found at the very top of page 1 of USPAP, just after the table of contents):

The purpose of the Uniform Standards of Professional Appraisal Practice (USPAP) is to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers. It is essential that appraisers develop and communicate their analyses, opinions, and conclusions to intended users of their services in a manner that is meaningful and not misleading.

The Appraisal Standards Board promulgates USPAP for both appraisers and users of appraisal services. The appraiser’s responsibility is to protect the overall public trust and it is the importance of the role of the appraiser that places ethical obligations on those who serve in this capacity. USPAP reflects the current standards of the appraisal profession. Source: USPAP 2018-2019 edition.

Wayne, the above preamble is not new. The public trust focus has been the focus of USPAP and is referenced prior editions. Unless you have been retired since 1989, you should have a copy of this in your library.

I am a bit alarmed that you once worked for Fannie, but did not grasp the public trust segment. Worse, it seems you were not aware.

Also, please refrain from name calling. “Snowflake” is a euphemism. It is a term most used by the Sinclair Communications group. Given what you have espoused in your comments, I would not throw mud.

By the way, I too am close to retirement. Glad you made it and good for you. I have 28 years in as an appraiser. I acknowledge that the system is changing, but most of our arguments are about due diligence. I have been around long enough to have experienced numerous changes in the profession. I survived by adapting. Most all of us have.

We all want to do a good job and be confident we are accurate in our valuation and report description. I would have trouble being confident that a bifurcated appraisal can be truly accurate because I did not inspect the property first hand. If I can’t be confident that our reports are reliably accurate, then why should the general public be confident and trust our profession?

Mortgage lending is where the most vulnerable are taken advantage of. Since most people have become accustomed to this, why not push the line a little further.

?

For mortgage transactions the GSEs, lender, and property owner/borrower have the same goal. They want the appraisal at the value they need to close the loan and somebody to blame if things go wrong. However, when the property owner gets their tax bill they protest their “high” assessed value because they want to pay lower taxes. Appraisals have nothing to do with public trust.

PS Out of my 35 years as an appraiser I spent six years at Fannie Mae in Credit Loss Valuation, National Underwriting Center on the Centralized Repurchase Team and Quality Control, and Enterprise Risk Management Valuation. Although I’m now retired, I have an inactive General Appraisal Certification and an inactive Broker License. My BBA isn’t really a factor at my age. I didn’t put all my eggs in the residential appraisal basket so I have numerous alternatives and opportunities if I ever want to restart my practice. My original post was intended to motivate other appraisers to do the same. There’s more opportunities even in residential appraisal than just mortgage lending. Play the cards you’re dealt. You’re supposed to be entrepreneurs so stop whining like a bunch of Gen Z/Millennial snowflakes!

EXACTLY!!

Who reimburses the taxpayer? It’s not a purely free market scenario when the consequence of possibly excessive risk is borne by the individual, while the corporation is indemnified, in part, by that same individual through the taxation applied to them.

Frannie, Please let us know what lender you are so we can help you start getting rid of us. We will know who not to take work from starting now!

Appraisal waivers are facilitating USER GROWTH.

Maximizing USER GROWTH is the same approach that is being used by Tech companies to maximize their valuations.

Kinda suspicious of the “UAD Survey” that has been recently emailed to us.

Since when have Fannie and Freddie given a rats ass about what appraisers think or want?

I smell a dead fish.

Dear Appraisers: Keep pushing back on bifurcated appraisals and we will do away with the need for you entirely.