Is that not Significant Assistance?
Is the property inspection by an unlicensed person considered assistance?
We came across an article written by fellow appraiser, George Dell. Some of you may have heard of him, read his blog, or taken one of his classes. This article “What is a Hybrid?” hits home to many of us and thought it was worthy of sharing.
Those promoting hybrid appraisals have been claiming USPAP compliance. Well anyone who has ever taken a USPAP class knows no form or product is USPAP compliant. The appraiser’s actions are what make a report USPAP compliant. In George’s article he points out the discrepancies within USPAP when completing these products and asks a lot of good questions. VaCAP encourages all appraisers to read his article. Even if you have no intentions of completing a hybrid appraisal, there is some good information he shares.
A few weeks ago VaCAP raised a question concerning § 54.1-2011 Necessity for License. This Statute states any unlicensed assistance must be directly supervised by the licensed appraiser. That begs the question, is the property inspection by an unlicensed person considered assistance?
USPAP FAQ 255 states Contributions made by appraisers that constitute significant real property appraisal assistance include identification of comparable properties and data, inspection of the subject and comparables, estimating, etc.
Well what about the assistance of the non licensed person, the property inspector? Is that not significant assistance? If that is considered assistance, (and common sense tells us it is) Virginia law requires them to be directly supervised by the licensed appraiser.
And here is another little wrench that needs some attention. A few days ago VaCAP received an email from a member informing us an amc contacted him about completing a hybrid appraisal and the HOMEOWNER WAS PROVIDING THE PHOTOS! Why not just let the homeowner determine the value?
Now we want to ask for your assistance. Because hybrid appraisals are being pushed by AMC’s and lenders and there is more than one concern about these products. We are asking each of you to attend the VREAB meeting on Tuesday July 31 and ask the Board for guidance on these products. Let’s get this addressed up front before someone has a disciplinary case over these products.
There will be a public comment period in which everyone will have 5 minutes to speak. Please plan on attending and asking the VREAB to issue guidance these products.
Tuesday July 31, 2018
10:00 AM 2nd Floor Board Room 4
Department of Professional and Occupational Regulation
9960 Mayland Dr
Richmond, VA 23233
Thank you for supporting VaCAP!
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What can go wrong with homeowners providing photos? SMH 🙄
The really weird thing about USPAP is that if the person inspecting a property is NOT a licensed appraiser, then what they are doing is not considered significant appraisal assistance and they are not required to be named in or sign the certification. The Appraisal Coach, Dustin Harris, did a podcast on this and I listened to the whole thing expecting to punch holes in the flaws of his logic, but he cited USPAP AO 255 directly and I realized he was right.
USPAP is a very strange document at times and with the push to redefine reports, I feel the “Uniform” part of USPAP is in danger of being dropped.
USPAP AO 255
It’s important to remember that advisory opinions are not ethics, they stand apart as possibly useful solutions provided by independent analysis. One can not defend with AO’s, but should rather rely on the actual ethics rules. For all practical purposes he’s an advocate for such products and is best recognized as an interested party.
Abdur, respectfully Dustin is not even remotely right on this one. It is pure sophistry and nothing more.
Word games and contorted semantics do not erase the character of the assistance that is alleged to be provided. If Dustin wants to be accurate then let him (& all hybrids) say instead that “NO qualified professional inspection took place. Assistance of a limited but UNprofessional nature was obtained from a third party inspector.” USPAP requires that our reports NOT be misleading! Dustin can’t have it both ways. The loophole he cites does not exist.
Most hybrid forms have preprinted language stating that the appraiser has deemed the third party to be credible or the data provided to be credible though there is absolutely no basis for making those assumptions. It also states that inclusion of the cost and income approach was deemed to be unnecessary and that exclusion does not affect the reports credibility. The truth is exclusion of these in MOST reports does affect or could affect credibility!
I just had an AGA member tell me he completed a “enhanced hybrid” as a learning and exposure experience. He said the client used an insurance adjuster to (1) MEASURE the living area; (2) Rate the QUALITY Q3 and (3) RATE the condition C3 as well as making all the other site and neighborhood characteristics and trend observations (everything is suburban by the way). He also completed the BPO parts (we don’t know WHAT kind of insurance adjuster he is, or if he is even a R.E. Broker). MAYBE the term BPO has also become obsolete and it should be called a “Non Professional Price Opinion (NPPO) instead of a BPO?” we ARE supposed to avoid being deceptive, aren’t we? Calling something a BPO that was NOT prepared or signed by the broker IS misleading.
Opinions concerning those characteristics are appraisal assignments. Pretending the inspector is merely reporting ‘facts’ is inaccurate and dishonest. Determining what is living area and what is not is an appraisal assignment. The same holds true with identification of potential marketability or safety issues on a site.
On another issue Jim Park of ASC has said that he wasn’t convinced ‘investigators’ reporting factual observations should always have to be in USPAP compliance. I disagreed.
The physical condition of a property IS a fact. That condition won’t change no matter what I call it. My professional OPINION as to what to rate that condition (or other characteristic) is an appraisal conclusion.
The same holds true with MEANINGFUL neighborhood characteristics that market participants consider.
I don’t care if it is Dustin Harris, TAF, MISMO, or hack software hucksters and their dishonest clients: I am fed up with having the professional requirements and TRADITIONS of MY profession misrepresented!
Mike,
We are on the same team. I don’t do Hybrids: Never have, never will. I think they are an abomination and are just a cheap way for lenders to purchase an E&O policy for what’s essentially an AVM. However, TAF is moving to make these type of reports explicitly okay. My big curiosity is what will happen the next downturn. It’ll be interesting to see how this is litigated.
There’s no way you can produce a credible valuation in 20 mins. I don’t care how much they change USPAP, it’ll never be possible.
Oh I know re same side Abdur. Didn’t mean to come hard at you. Merely the concept of Dustin’s and others overly careful parsing of language to justify wrong doing. Read some of Danny Wiley’s posts on here sometime (BTW he has STILL not accepted the challenge to provide just ONE completed hybrid purporting to comply with USPAP done as advertised for low fee and short time).
I also follow your posts Abdur. We have no problem. Not even when or if we disagree. Always interested in all views. Encourage you to continue writing full articles as well.
Mike,
We’re cool. Just didn’t want you to think I joined the Dark Side. My OP was just pointing out that USPAP is very inconsistent about real property appraisal assistance. It’s strange that the same thing done by two different parties–one an appraiser, one not–can create entirely different regulatory compliance issues. That’s a big problem in my book.
Again, it all goes back to lenders not really caring about the quality of appraisal reports. When Uncle Sam is there to bail you out, why should you?
Thumbs up my friend!
Danny Wiley is probably one of the biggest reasons appraisals take so much longer to submit than they use too. He turned me in to the appraisal board one time on a review that was completed by an appraiser who only had their license for 6 months and lived in a different state. This guy is definitely not on our side and is a direct cause of the problems we have today
An appraiser should have 5 or even 10 years of solo experience before they even touch a review of any sorts. Sadly, the management companies are able to drive review fees down quite a bit so the new guys get them. I have not seen a review request in years. They prefer to grind me down with origination work and they reserve the less essential duties for the other guy.
I came out of the fee shop training camp Mentors were an MAI and an SRPA. I think my first reviews were around 2 or 3 years into it.
At the time I thought the idea was to ‘catch’ something. A mistake that nearly ALL novice reviewers make. MY desk review and face to face meeting with my mentor ended that notion in no uncertain terms. Performing objective field reviews is a great learning experience (for our own appraisal work). I think you are right though. 5 to 10 years before we think about criticizing the work of others. Even longer for commercial.
Even today, after 32 years there is so much that I don’t know…though I DO know where and how to learn.
Mike, like you I mentored starting in a small fee shop, that was before licensing and the only license to be had was a brokers license. The FHA fee was $20, and the VA $5 more. Major recognition came from the designations won thru several of the professional organizations. Much of our work came from government bodies and agencies. Mortgage companies, Banks, S&L hired in-house appraisers, and if they had underwriting it was because they were too small to handle the loan by themselves.
When I left and went private, I discovered responsibility in the form of being sued. Reading carefully the terms of reviews I discovered that when you agreed with the first appraiser you took responsibility for his work, mistakes and all.
I charged full price for reviews and the few I did discovered a reason for not agreeing. That reasoning took more work than going along and my extra charges priced myself out of the market.
The world Ain’t free, and appraisal clients may try to mislead, take care and use protective language and lots of it.
Concur, Don. Back when we were ranked as Class I, II; III & IV appraisers a designation was a big deal. Its why I was a Candidate for several years. While not the same thing, it was a back door to work that would not otherwise have been available.
I also priced myself out of most reviews. ANY review takes at least as much work as the original appraisal since we are checking what that appraiser SHOULD have checked in addition to what they may or may not have checked. I still believe that 1 in 10 appraisals MUST be field reviewed in order to assure meaningful quality control. Desk reviews are essentially crap and no substitute for a good field review by a local reviewer. A decent review should cost at least 1 1/2 times what the original appraisal SHOULD have cost if not discounted below C&R.
The first time Landsafe asked for an opinion of value on a so-called “enhanced desk review” where I didn’t believe there was sufficient credible information it went all the way up to a V.P of Corporate Security for BofA, who agreed that the regional supervisor for their old Landsafe division would be getting some remedial education on what can and cannot be asked… and why.
Don many feel I come too close to that magic line for language. Perhaps. Though it was my use of limiting language in my disputed report with BREA that the judge said clearly proved the state’s allegations had no basis.
Hybrids, Insurance company’s use accountants to INSPECT recently insured for dangerous dogs etc? Accountants and insurance agents are Professionals!?
Lenders Ask Appraisers to judge: dangerous threats to a loan, such as street widening, for threats to the loan, such as potential erection of Leased phone towers. Does the leased fee of a potential erection and income from said tower detract or enhance the property?
All of these situations are hybrid and REQUIRE a Professional appraiser. DISALLOWING hybrids is stating all professionals are Krrooks.
Only some are, some not. We must stand on our reputation that’s one reason starting a new business is tough
don
One of the assignment clerks I dealt with moved on up in the world and now he’s an insurance adjuster. He probably did not get along with the new panel manager who also had no experience in real estate, lending, brokerage, sales, or valuation of any sort what so ever. Lenders are obviously remiss to hire people without extensive direct experience in either lending, appraisal, or mortgage to be the top manager of appraisal panels. It’s probably better to be on the hesitant more cautious side, given these inconsistencies with what should be all around an absolutely credible trustworthy process ran by experienced professionals.
Don’t play language games. The root premise of the questions at hand are should we trust un named, unknown people to provide appraisers information we rely on? Also confused on the difference between hybrid vs gmo foods? Clearly nowhere near similar. A hybrid report is a misnomer. It’s actually a super light version of an appraisal, less the quality experienced licensed accountable respected person showing up and performing essential duties. If you can overlook that, sure it’s a ‘hybrid’. A hybridization of totally unqualified servicing persons, irresponsible licensed individuals, and deceptive middle management self promoting practices. Consumers and taxpayers deserve better.
Well said !!!
And I can honestly tell all of you, I am dealing with the dumbest people that I’ve ever had to deal with in the last 30 years. Every day!!!
Article worthy, if you would, pretty please…
“A severe lack of qualified persons in appraisal distribution departments.”
Someone should do a study…
Referring to my client files… Not looking very good.
Don’t forget our services and the consumer appraisal fees which are improperly co mingled to fund middle management, are now publicly traded commodities on the stock market. I finally made it back to the corporate table, just without the entire range of normal employee benefits. Picked the wrong career again, bad luck I guess.
They want to be able to control (hire and fire) appraisers exactly like the assignment clerk you speak of in the first paragraph. Having complete control over appraisers and they want appraisers to beg for pennies. Its pathetic
Yup, and don’t forget they hate us, they know how much we make, and they think all we did was walk through a house for 30 minutes, these people are called jealous haters.
I’d bet there is a hamburger menu app for that even an illiterate person across the world could use. The miracle of integrated meta tags… If you use one of those fancy new camera’s, the lenders likely can learn exactly how long you spent at an appraisal visit, if judging time frame of first picture to last, to include comps! One mortgage banker came on the forum once and disclosed this to appraisers, specifically, it’s in the jpg data. That’s why I love my kodak dc210 all these years later, have a dozen of them in the drawer. Never run out batteries, never lose the memory cards, and my meta tags still show 1999 because it resets to factory state every time you press the power button. lol. I show lenders what I want to show and otherwise really appreciate a good old fashioned simple grainy non geo tagged non time stamped photo. This is me, whistling past the graveyard. The more you know about tech… I’ve spent entirely too much time reading about the details of tech and it’s possible underlying uses and function to actually spend my own money on it. Ha! Telemetry is for the birds. Musk 2018; We’re all cyborgs now.
Pure sophistry Don.
You know darn well these are not the types of appraisal hybrids being hyped. Frankly, they aren’t hybrids at all other than land use hybrids (aka mixed use).
Doesn’t Dustin Harris claim to do 4 to 8 full appraisals per day, and at times only need as little as 30 minutes to do a review prior to hitting the upload button? The hell with USPAP. If the situation doesn’t pass MY smell test, or MY morality test, than I could care less if there’s a loophole in place to make a few extra dollars.
Seek the truth.
You should quit spending so much time caring about what that guy is doing, ha! You’re a trip, always on about the coach. Trust me, we are in agreement. He ceased to be relevant in 2010 when he refused to reconcile the fact that cost savings from reduced cost of appraisal services were not returned to borrowing consumers and instead represented a thing of value the appraiser provided to be the preferred selectee with amc’s. It’s pay to play that’s why none of those guys will touch the issue of fair billing practice. They are the last place to turn to for consultation and they censor open reader posts on their blogs. Great speak easies don’t exclude dissenting voices, especially those voices whom are standing up for consumers when nobody else in an entire industry is willing to do so. We stand alone against the tide. Peace sells, but who’s buying?
Abdur, Think about what you just said. Only a licensed appraiser can provide assistance. What is it when an unlicensed person provides the same assistance? That’s like stating you can’t give the unlicensed driver a speeding ticket because he is not licensed. Common sense and logic need to be used. Your license is in place to protect the public. Are you really doing that with these products?
In case you were not aware, some AMCs are asking appraisers to inspect the property and another appraiser to complete the report. You USPAP compliance just became an issue!
He’s just following industry standards these days. It’s confusing when sitting in the appraisers chair. We’re held to rules and standards via individual licensing. Yet the vast majority of those people whom we must appease and appeal to in order to receive routine work assignments, those people are not accountable or licensed. Apply that same analogy to the distribution departments of mortgage lending appraisal requests…
Non licensed non accountable individuals order ROV’s, define SOW, promote hybrids, interfere with fee schedules with biased intentions, are not compelled to return cost savings to consumers. They do pick and choose with non rotational biased order assignment methods. Separation from loan production rules have done more harm than good. Appraisers are hard pressed to find a distributor whom hires qualified individuals whom actually demonstrate independence from the interests of their loan production employers. Their job is to sanitize everything and make sure the appraisers do not bother the lenders. Promoting Hybrids is a convenient way to accomplish all goals, increased profit, offloading liability to multiple parties, and since the appraiser has reduced responsibility, has even less of a voice.
He misstated his own cite. Click his AO 255 link and read what it actually says.
Mike,
Again, we’re on the same team here. We both find Hybrids loathsome. However, AO 255 clearly states that:
1) USPAP does not include a definition of significant appraisal assistance.
2) The term appraisal assistance means that the contribution is related to the appraisal process or requires appraiser competency.
3) The certification requirements in USPAP apply only to appraisers.
The example AO 255 gives is if an appraiser inspects the subject or comparables they MUST be named in the certification and their contribution would construed as real property appraisal assistance. However, what if the person inspecting is NOT an appraiser? It’s a loophole you could pilot the Millennium Falcon through.
Some may argue that only an appraiser should inspect a property, but that is a slippery slope. All of us as appraisers rely on the work of non-appraisers in getting GLA of comps (assessors), photos of comps (Realtors), and at times property condition reports for items not obvious to us (home inspectors). None of the above are required to be named in our reports or sign the certification. (Although in the case of 3rd party experts most appraisers would, of course, name the person who produced the report they are relying on.)
I personally wouldn’t have a huge problem with Hybrids if the following were true:
1) They paid a fee comparable to a drive-by appraisal. So, no more of this $25 crap.
2) You worked them up in your own software and you pick your own comps through MLS.
3) You could “escalate” a file to require a 1004 if the available data indicated an appraiser needs to handle the whole process.
4) Liability for the mistakes of the person inspecting the property was passed on to the inspector (or the company that engaged them).
Not every loan requires a full-blown 1004-level process. Sometimes, that’s overkill. However, a $25 report produced in 20 minutes is probably worth a negative sum. It harms more than it helps…
Concur with most but I don’t see loopholes as acceptable – nor flying star wars craft through them.
ALL appraisers know what intent to deceive means, and great majority of us simply don’t engage in it. Courts may say “well for there to be intent we have to prove it.”
My standard is a bit higher. The very boilerplate on every single one of these hybrid-sharts is deliberate intent to deceive. Thanks to TAF SOW Rule, now its easier for any piece of garbage to be called an ‘appraisal.’
New engagement work around; I can’t rely on any of this. All requests will be elevated to full service appraisals. There, fixed it.
Milton, that’s not what I said. I stated that from the perspective of USPAP, if the party providing certain types of assistance is NOT an appraiser then they do not need to sign the certification or be named in it. That’s in black and white in USPAP.
Also, I DO NOT perform hybrids. Never have, never will. They’re crap.
That article by George Dell nailed it! Too many inconsistencies surrounding these products. I hope Virginia does step up and provide some guidance.
Lots of content on his site. Suggested reading.
Ludicrous !!
Me myself I just do not complete this trash. And when they fail (we all know they will) the test of the next crash I will have no worries about the lawsuits arriving at my door. Good luck with that to all completing this trash.
There will be no relief for you Koma, or for any of us. My EO insurance just jumped over 100 dollars, paying $750 dollars a year despite never once having a single complaint or suit.
EO insurers do not ask if the appraisers complete these products. Until they do, and provide additional separate insurance products for additional costs, the losses sustained by use of hybrids will be dumped on the backs of all the appraisers, including all appraisers whom do not complete them.
Want to make real headway on this issue? Do not turn to government, but rather appeal to insurers to allot the risk to the individuals completing these products. Think of the ratios of risk management and how much we’re taking on for the sins of others. Hybrids take a tenth of the time, yet cover ten times the volume. It would stand to reason that those whom complete hybrids should add a full zero to the cost of their coverage. Think of the liability risk we’re all shouldering via insurability costs, and I believe a factor of 10 if not greater is a reliable number to consider.
Would appraisers still go for this if they had to cover the practical insurable cost and could not offload that to their innocent by standing peers? How’s an $8,000 a year policy cost sound to you? What about $1,400 or $2,250 cost, which will be what we start paying when hybrid losses start rolling in, we’ll easily see our costs double and triple. It will not take long for these hybrids to catch up to the practical operational costs for insurers, and when they do…
Would E&O even cover hybrid appraisals? Never considered this side of it. Your absolutely right though. Great point.
Good point Baggins! Maybe we should start thinking that way on a few of the other items that are dragging us down. Go around the heavy hands that are above us not doing anything to help us.
Thank you. The invisible hand is going to be the insurers response to this issue and the interests of appraisers will not be their first priority.
Appraisers should not pay a flat rate, but the system is set up that way under group pooling and affordability for all. Enter hybrids, exponential increases in appraiser production volume and the risk the appraisers place on insurers.
The insurance covers the errors and omissions amount in a linear fashion. The insured amount has nothing to do with the appraisers fee or time the appraiser took to complete an order. If an appraiser applies an adjustment in recognized covered services, they’ve just done so under the cover of insured activity.
The insurance risk is cumulative based on volume. Logic would indicate that if insurers charge appraisers whom do mansion work a higher amount, they should also charge appraisers whom do volume hybrid work a higher amount.
The industry is losing the benefit of affordable insurance through group pooling and appraiser attrition is being accelerated because so much bread and butter work is now going to hybrid providers. Look at your EO rising costs, nobody has been spared.
With any luck the insurers will not insure appraisers whom complete this work and the liability will be on them personally. Appraisers whom have not received explicit permission from their insurers may be surprised to find that despite their best efforts in accumulating an ethical compliance argument regarding hybrid products, the product itself does not meet the insurers specific definition of what is and is not covered. What’s more important the license or the insurance coverage?
Hybrid appraisals are nothing more than a gimmick to try and gain more power over appraisers. That is all. If you want to hand your degree and professional business over to a gimmick then you may want to participate in this. Otherwise understand that as the AMC model is disappearing they will try anything to stay in business and taking you down with them is no matter to them.
Well said !!!
Great lead time in asking for personal appearances VaCAP!
It is NOT just banks and AMCS. It is TAF itself and their behind the scenes support of MISMO. Instead of coming out an using plain language to warn appraisers the amount of work required to make one of these pigs ears compliant defeats the entire time saving / cost saving process, they infer they can be compliant! The hybrid hucksters only read “TAF says evals are compliant” and they think a hybrid is ‘essentially the same as an eval.”
Instead, they offer courses in making evals USPAP complaint. While evals are technically different than hybrids they are conflated with them all across the market. The people that benefit from such courses could likely figure it out on their own. After all USPAP is clear and simplified now isn’t it? It is the low information bottom of the barrel appraiser that will be doing the hybrids. Being told they can be done in only 15 minutes will make that the goal rather than compliance
Some hybrid-garbage promoters even call their trash an Eval AND appraisal in the same preprinted document.
I have made the challenge repeatedly & nationally, including to Danny Wiley about showing me ONE single completed hybrid that is USPAP compliant; completed in anything remotely approximating the estimated completion times claimed. So far NO ONE HAS BEEN ABLE TO DO SO.
That alone should serve as evidence that USPAP compliant hybrids only exist in the imaginations of their self serving promoters.
Well said !!!
Can you imagine an Artwork appraiser saying. “Please send me a picture of the art work, make sure you take all sides…and I will let your insurance company know how much they should insure it for.”
Same thing right???
exactly
Well, sort of. If I can grill an interested party and press them for additional detail… If I can claim a full fee or sorts and have the time to press myself for further data confirmation and detailed research… If I can know ahead of time the limited array of people will be held accountable for any false information provided to me which I may have relied upon, via workfile documentation and meticulously recorded email copies…
If only I could know the the name of the 2 dollar an hour ‘appraisal typist’, among other participatory persons whom may be included in the valuation discovery process. Think legal. Think discovery. Think liability exposure. Names, details, records, or no deal.
I’ve never even gotten to that point with solicitors of hybrid products though. Each and every time the solicitation interest response has been stalled out by one simple question; “How much is the lender charging the consumer for these products?” Things end where they begin.
Don’t use the 1004 form for special appraisals, cite the differences, and charge for the special issues brought up from the differences. I have made appraisals from unseen properties, citing features from others, described views from mapped topography, “including the topo. maps”. Declared Utility employees knowledgeable, or un- knowledgeable, cited principles to the transaction un-knowledgeable, cited planning officials for directing a master plan in improper direction.
Done a lot of stuff that wouldn’t fit on a “1004” nor could you meet time requirements putting together the verification’s.
The general appraiser has to have room to do all of things required in a changing population, with changing laws.
The only answers which make sense is be judged on his report, not a lenders convenience.
Use the FNMA 1004 only for qualified properties, charge for differences.
Absolutely 100% correct Don. The difference is you (and others) don’t pretend to do these in 15 minutes for from $25 to $65. I’d also bet you DO conform to the requirements of USPAP. The non standardized things you cited demonstrate [to me anyway] you are not simply checking a box and throwing numbers around.
Oddly, you and I have ALWAYS had this flexibility long before ‘evals & sharted-hybrids’
We shouldn’t restrict the hard working efficient appraisers who work 18 hour days in high density neighborhoods, however they shouldn’t penalized a majority who work in normal districts.
Making money is honorable in our society.
One of my favorite bitches is the ruling about reporting your previously jobs. Appraising for a client a foreclosure every January or Feb, because the owner extended his credit for Christmas, and having to report it is obnoxious officious controlling, and trying to control their clients. Appraisers should participate in the rule making and not allow any officious controlling ruling from congress.
All,
VaCAP wants to share some great news that transpired today at the VREAB Meeting.
Due to the comments made during the public comment period of the meeting, the VREAB has formed a committee to establish guidance on the issue of Hybrid Appraisals. Discussions among the Board members revolved around public trust, the legality and definition of assistance and that these products will be a huge issue going forward, not only for appraisers, but for the VREAB as well.
This is a step in the right direction and we are very pleases VREAB is taking a proactive approach to these extremely controversial products.
I’m glad to see (& commend) the pro active approach but ANY acceptance of these is a con job.
They are garbage and they cannot be made to comply with USPAP as they are advertised.
They’d have to actually BECOME 1st person drivebys OR appraisers own trainee doing the inspections and appraiser doing rest.
Lenders think drivebys are too expensive and time consuming…Yet we STILL see stips and revision requests on the hybrid horseshit that is supposed to bypass all their cost and time concerns.
What VREAB has to say without equivocation is “Hybrids as designed, sold and advertised and priced cannot with any reasonable belief be made USPAP compliant and Virginia will not condone them at all.”
THEN if the hucksters still insist on them and VREAB WANTS to allow them, do something novel;
Give all licensed/certified appraisers a 100% exemption from USPAP and ANY and ALL state oversight on ALL hybrids and Evals. Let ALL users know that the state will NOT even pretend that any will be done in a USPAP compliant manner for the $8; $10, $25 and $225 (total) non C&R fees found associated with them.
I bet they disappear from the Virginia market completely then.
See, the promoters WANT to be able to deliver horse shit, and only pay for horse shit, but they dont want that horse shit called anything other than “appraisal”.
Mr Ford. Please chime in on the influence insurers may have pertaining to these, if they were to recognize them as covered products or not, and if the consideration is even that simple in the first place.
Inquiring minds want to know. Thank you.
I talked to an insurer just yesterday about your very concern that anyone completing hybrids should pay the increased costs absorbed for completing high risk hybrids. He was in an Appraisal Institute class at the time so I asked him to bring up the scenario. He stated the class was a class not pertaining to types of coverage. However he did say that they do cover hybrid appraisals. Would be good to get the E&O companies on the side of the appraiser and not the big bank but they are probably owned by the same people
Baggs I don’t speak for insurers or pretend to know all their policies. I know that SOME large insurers OWN AMCs. Is that a possible clue?
I know some insurers are members of MISMO – maybe that indicates something?
Baggs I refuse to dignify sharted-hybrids (bifurcated-horse-shit) by treating them as having one iota of legitimacy until someone (anyone) answers my ongoing national challenge: “Show me just ONE USPAP compliant hybrid completed at the prevailing fees offered in the 10 to 15 minute time periods claimed.”
So far no one has accepted the challenge. Not First America; not ACI, not Danny Wiley, not ClearVal, not ValueNet. NO ONE.
The reason no one can provide one is that they do not EVER conform to USPAP as advertised in the times cited for the fees offered. NOT EVER!
Shame on all of us for even discussing it further until someone can PROVE to competent peers that the snake oil they’ve been pushing can be made to do or be what they claim it does or is.
NOT ONE person promoting these has the personal or corporate integrity to stand behind their product by SHOWING a completed one performed as a normal ordered assignment in the time advertised for completion at the fees offered.
I know, I may have been too subtle in my response. Apologies if anyone is missing my point. Fault is all mine.
Ummmm……
Did not expect to hear that.
Suggestion which is hopefully productive;
Switch gears and make sure the majority of popular EO insurers are well aware of the risks these products are generating.
Great idea in between other duties, earning a living and blogging.
I think it IS a good idea and we should be in touch with Christensen if no one else. …IF I can only figure out how to stretch my normal 30 hr day into 36
Many appraisers worked their way thru experience researching; assessors records, title companies, interviewing engineers, realtors, builders, zoning-planning departments, etc. They also got stiff fingers dialing and verifying sales transactions, leasing stuff etc. This was the way to appraising measuring all kinds of properties, taking classes, was an important part. Lenders used part time tellers and or Loan officers worked them into appraisal. These lenders had skin in the game, they believed they may have to take the property back. The FEE appraisers also believed that.
When Banks S&L’s and brokerage houses sold their loans they guaranteed the paper and Traded SWAPPED loans in the packages.
Thereabouts in 1968 laws were passed that standardized loan packages. Appraisers had a new National awareness, and politician began to solve our situation.
Their are good and bad appraisers and good and bad politicians. We should separate the good from the bad
One feels bad for appraisers whom never had the opportunity to source orders from actually individually licensed and accountable professionals like mortgage brokers.
Many people that were wedged out in that time period, they started amc’s and managed the process instead of performing these vital services themselves. They knew exactly how to game the system.
Another take on this is this…where did alot of appraisers go after the sht hit the fan, they jumped into review..so people looking for appraisers say to themselves.”hey…lets see if we can get those guys/girls to write 1 or 2 or more over a weekend, tell them its only 1an hour of work….
I say let them try……it ok to try to innovate…….let the market work it out.
That is America….
For the record, i would touch them at all, not worth the lawsuits….When fees go up to $1,000 and i am going to see retirement coming, I will start teaching again….until then……ahhh…do they have to wait 1-2-3 weeks……ahhh….poor babies…..
I have a friend at a major lender….he told me today they are junk and everyone knows it !!!
Chris When HVCC my approach was let the market take care of it…until the market never did. HVCC wasn’t killed by AI either. It was people like Pete Vidi, Marion, Pat Turner and more than I can recall right now that killed it – I THINK past of the vehicle was DF but I could be wrong about that.
Waiting on the market to fix appraisal abuses simply does not work. I spoke to a VP of Corporate Security at BofA bank in 2010 or 2011 about a policy problem. He agreed with it. He even fixed the specific issue (a Landafe one); and told me even while he’d forward the concerns upstairs; IF BofA agreed 100% the very next day it would still take them two years to implement any policy and procedural change on how appraisals were ordered and serviced.
There is a lot of inertia in ‘the market’. It takes effort to stop and start changes.
Off topic but I am noticing comps in my alamode data base are being altered with data that is different than what I entered. Anyone using alamode needs to verify every comp they reuse because I am finding a large majority of comps have different data than what I entered into them. Beware
Jeff, I think that is appropriate to notify the ASC and FFIEC about. CL populates the alamode data; they also control or heavily influence the FNMA CU database. It was bad enough when they were just incompetent, and lazy. If they are now knowingly altering data I think federal regulators should be aware of it.
Guess I need to add a disclosure in my reports stating that the owner of my software program may in fact altered the sales and listings I have provided in this report. I have no control over the owner of this software yet they may from time to time alter my data and reports. This is for real. I just spent an hour changing the data in almost every comp I used because the data was all different
I thought I noticed that as well but I thought I was crazy.
That’s exactly Chris. I thought I was going crazy too until I really started looking into it.
This is really bad. Not only is it my comps data base but an actual report I used as a clone had the data incorrect. So my actual report must have been altered
You guys need to document this and file formal complaints with ASC and FNMA (assuming it went to them).
1. Its either a simply explained oddity (I doubt it)
2. Evidence of potentially deliberate appraisal manipulation that could undermine the entire idea of using UCDP; or anything OTHER than locked pdf reports transmitted by email just as we used to do. Secure email encryption is not that hard or expensive to get.
I will work on documenting the evidence and creating my case
contact me if I can help. Mike@mfford.com or 1(714) 366 9404 or send to janbellas@apprisersguild.org attn Mike
Corelamode cross populates their databases. Lots of discrepancies identified between Real Quest, Realist and Matrix MLS data. Maybe they are scrubbing comp data that doesn’t match what they already have from one of their other (unidentified) sources.
This is SO wrong on so many levels…It’s one thing to steal our data; quite another to change it!
What I just noticed is that what the comps in my database and report had didnt match either mls data nor my actual data on properties I had completed field services on. It was everything from room count, square footage, garage type you name it. I will call FNMA I guess to see if they have had an increase in data discrepancy. Because in this case the data did not match anything I would have entered.
Cross reference with each other. Mac or Windows. Base software aurora or total, vault or not, how are you using export and import features, cloud or internal, and have you or have you not participated in the comps sharing program?
“Technology integrations”. I believe that is exactly what Corelogic specializes in. They’ve stumbled on a massive data grab, things you were not supposed to find out about?
I used to get a copy of my report or a few vital pages of it now and then from an auditor whom wanted me to verify the copy they sourced from the lender was the same copy I turned in as intended. It used to be a somewhat frequent event, I’d get several of them a year, always printed and mailed. Not lately though.
Maybe in order to sale the data there had to be a consistency parameter so the data would look more reliable hence the manipulation. You have to prove the data to be consistent for it to bring top dollar. I am a silver membership, apex sketcher that does not subscribe to the vault or use the cloud either.
I’ve found database export tools to be a waste of time. It’s just easier to use comparative entries anyways. Better, superiorC, good match, inf – lrgr dk, things like that.
Being a new user of this type of data set I am finding it is very flawed just seemed dependable and useful pre CoreLogic. I typically am at a luxury of having my own field data to provide for sales and listings in my market areas. for a period I would measure a majority of the properties that were being listed. Gives you an idea of the size of the towns I work in. Doing so you don’t MLS data is more so than not wrong which most realtors take directly from the county. So I loved the fact that once I had an address entered I knew that data was correct and quick to enter. No longer going to be able to use that portion of the software again. So much for speeding up the process
Alamode tech support confirmed the data in my comps data base is only seen or populated by me. Will just have to keep a closer eye on this and monitor my comps database
You’d have to audit your own records and make specific comparisons to know for sure. I’ve looked back and said, how did I miss that, but knew it was my data error.
For tech support, if something high level happened to data integrity their job would be to sweep it up, if they were even aware of it in the first place. The corporate guys wanted the data, the tech guys have no practical use for it. The purchase was a data grab so your theory is plausible.
This discussion has gotten away from the title posed. I had developed an engagement letter I used as a contract.
The engagement cited any help and type of help by name, so my assistant could have a record. The engagement cited what value I was seeking; FMV, Insurance, for a divorce, whether a cash out price or Institutional third party financing, ERC interpretation, etc. Also included is-was a caveat for collecting any fees spent for defense because of the assignment and a daily cost for any demands beyond the basic report.
Mostly no one objected, Mostly any additional work or I thru it in because the fee was adequate. Once in a while I charged for the extra stuff. When the request was dumb, like Adjusting the listings, I refused. Some clients Fired me, many didn’t.
WHAT did I loose? dumb clients?
Glad I hung it up, Used tooo bee an appraiser for 57 years.
Did I make mistakes, WHO DON”T. All of the institutional lender have and still are.