Mueller REO Hybrid Appraisal Report
- Federal Valuation Agency Impact on Appraisers & the Public - July 22, 2022
- Is Georgia Going Rogue? - June 13, 2022
- Bias in Automated Valuation Models - February 28, 2022
Another Mueller Report has surfaced. The report is a Mueller REO Hybrid Appraisal Report and it was given to an appraiser as a sample. This one raises more questions than the last one!
The photos from the property inspection do not tell the appraiser one thing. The photos are dark and the repairs the inspector states are needed, simply are not seen in the photos. It begs the question, does the appraiser have adequate information to complete a credible appraisal?
Now take a look at the Mueller REO Hybrid Appraisal report. Pull up the report and follow along. Some things have been highlighted.
Let us start with the Comments Section on page 1: Under the subheading of ”Reconciliation” is a definition of exposure time and the appraiser’s opinion of exposure time. Yes, an opinion of exposure time is required, but is this a reconciliation?
Moving on to the Reconciliation Addendum: The report states the subject property is under a contract for sale and the contract was not provided. Does this comply with USPAP Standard 2-2 (a) viii? The comment in USPAP specifically states the appraiser is to state the actions taken to obtain the sales contract. Does simply stating it was not provided sufficient for compliance? What about the listing history? Advisory Opinion 24 specifically states the appraiser must analyze and report the findings within the appraisal report. Has this been done?
Further down, the statement is made “Comparable 1 backs up to condominiums. A $15,000 view adjustment has been given”. Great, except on the sales grid, comparable 1 is stated to have an “adverse residential and industrial view”. Is the adjustment for a condominium view or an industrial view? Anyone see any industrial properties from the aerial photo in the report?
“It appears that the typical condition for the subject area is C4, therefore the only repairs needed are painting of the subject
What the heck does that even mean? The neighborhood is a C4 so we have to paint the subject? If the appraiser did not inspect the neighborhood, how does he or she know? Anyone else notice the amount of times the appraiser used “it appears” in the comments? Does “it appears” instill confidence in the results? Is one matched pairs sufficient for supportable and credible results? Give the appraiser credit for discussing how adjustments were determined.
Take a look at the sales grid. Two of the four sales sold above list price. Seller concessions? Commentary?
Now the Condition Report included in the Mueller REO hybrid appraisal brings up some more questions. For the Neighborhood Section, answering yes or no to a few items? Really? Does this tell anyone about the neighborhood? If this section is for the neighborhood, what does atypical for the neighborhood mean? Are they referring to the subject? What about the other items in that section? Are commercial properties (shopping centers, grocery stores, etc.) and highway access positives or negatives?
Moving on to the Subject Section: Well look at that, the property inspector has given an opinion of the quality and condition of the subject! Was that unnamed inspector a licensed appraiser? What about the Ethics Rule that states an appraiser must not accept an assignment that includes the reporting of predetermined opinions and conclusions? Does this condition report provide adequate information about the subject for an appraiser to produce credible results?
Now look at those photos! Are you impressed with the photographer’s skills? Look at the photos of the repairs needed. Does anyone see what needs to be repaired? Did the inspector not like the color of the walls? Where is the damage? Can you really tell much about the subject from those photos? What about the photos and the condition report together?
Now the fun can really begin: The Disclosure!
Look at the highlighted sections and think about the following:
- Standards 1-3 (b) develop an opinion of highest and best use. Can this be done with an extraordinary assumption? Does the legality of the subject contribute to market value? Will this lead to credible results?
- Is the intended use stated in the report logical?
- Does the “inspecting professional” that provided the subject information have a name? Was the appraiser able to communicate with him or her to ask for clarity? Additional Information?
- Does simply typing your name on a web based form satisfy the management of an appraisers signature under the ethics rule?
Now for the icing on the cake – Appraisers Certification #9:
Unless noted, no one provided real property appraisal assistance to the appraiser signing this certification. Significant real property appraisal assistance was provided by Mueller, Inc. representatives who completed the property inspection report…
Would you complete this assignment?
Reminder, Take Action:
The fourth exposure draft for the proposed 2020-2021 USPAP has been out for a few weeks now. There are lots of things being proposed and comments are due by April 1. It is important for every appraiser to review the proposed changes. If you agree, great. If you do not agree, you have a very limited window to submit your comments / suggestions. The changes will be voted on April 5th at the Appraisal Standards Board Meeting in Kansas City, MO. If you up for a road trip, you can also attend the meeting in person. A live stream of the meeting is also available. Registration in advance is required for attending in person as well as live streaming.
See the Exposure Draft here.
I just googled that address because it looks familiar… Fannie Mae!
So Fannie Mae is accepting non USPAP compliant appraisals!
This report is worse than a bpo. No self respecting appraiser should associate themselves with this garbage product. I Wouldn’t even use it as toilet paper! I used to think highly of Fannie Mae but this just made me realize how low they have gone. Sooo sad!
And the poor sucker whom lost his property is probably having that fake appraisal used as the cornerstone for how much he is going to pay and be indebted for in the very near future through the court and debt systems associated with loan default. Oh, but it’s not an FRT, so it’s cool if we absolutely defraud everyone.
Very good job breaking down the cons of this report VaCAP. It seems, though, that much of what you’re pointing out could be true of any appraisal report – form or narrative. E.g. putting exposure statements in the reconciliation, failure to adequately offer support for adjustments, lack of commentary for why the sales sold above list price, failure to adequately analyze zoning and highest and best use (in fact, that faux pas is a LOT more common that many would like to admit), and poor quality photos – those are all items that we might (or might not) find in any reporting format. To the items that deal specifically with the report format under investigation, however, you raise a great point about the appraiser being the one to determine the subject’s condition (based on the photographs provided), and not relying on – as you stated – predetermined opinions and conclusions. In addition, I agree that there may be concern regarding the digital signature – I’m sure that would depend on the level of security that the software application has – but definitely something an appraiser should consider before engaging a client for this type of service. Regarding the reporting of ‘significant assistance’ – (and I’m sure Baggins, or Mike Ford, or someone similar will take me to task for this) – I’m still not convinced that inspection data is ‘real property APPRAISAL assistance’, thus – while I agree that the ‘Mueller Reports Representatives’ statement is extremely questionable, I probably wouldn’t even consider it necessary. All that said, were those items addressed and corrected, the report format itself is neither compliant, nor non-compliant. The appraiser is who makes a report USPAP compliant – regardless of the format or level of inspection.
“I’m still not convinced that INSPECTION data is ‘real property APPRAISAL assistance’.
Hey, you and everybody here and elsewhere is confused about the ramifications of INSPECTION. Let’s make it clear:
The only question, and I’ll reiterate, the only question is WHO inspected. You? Me? Joe Shit the RagMan, Mr. Drone?
Mr. Reynolds, if you put a value figure on any property you better have inspected it, and inspected it yourself. Period.
If we rely on this creature, Inspection Data, that is ‘real assistance’ and we are on the hook. Better include weasel words.
Oh, and this nonsense about USPAP not making appraisal reports compliant. The hell they don’t!! They do it every week of the year. Ever hear/use the word: IMPLY? Get a load of FNMA’s March 2019 Appraiser Update! The new 1004P is a thing of beauty because….Oh, they don’t say it, but FNMA implies its gonna be(!) and I’m sure FNMA discussed it w/TAF or whoever is in charge of USPAP.
Merv, you just wiped out the entire review function if you assert that I should only value properties that I inspected. Every single day appraisers, in a review function, estimate value on properties they did not personally inspect through standard 3 reviews. Oh – and that doesn’t even address the 2055 appraisal work. Tell ya what, I’ll let you stick to your rules, and I’ll use my (granted not very bright) noggin to appraise by the real rules.
So how much reliability is diminished in the review function when you’re dealing with hybrids and an even greater degree of uncertainty regarding both reporting and inspection? The review function is there as an additional check and balance. But what purpose would that review function serve if the checks and balances ahead of that point were diminished beyond basic standards of credibility through the hybridization process? You can’t stipulate the problem away with wordsmithing if the fundamental question of reliability is there because of an unnecessary overly complex network of middle management, likely inadequately qualified inspector services, and other third party services.
Review challenges when dealing with a $5 dollar 10 minute photo set only home inspection backed by inadequate hybrid short form desktop reporting. Yeah, that’s a headache I can’t wait to dive into. The disclosures would likely be longer than the review itself.
This is going to confuse the hell out of actual qualified home inspectors, to hear that another appraiser inspector whom is not actually an appraiser and is not actually an inspector has already been there. Initial disclosures show homeowners are already confused on these points. How to dress up a fraud and sell it with gusto.
“It appears that the typical condition for the subject area is C4, therefore the only repairs needed are painting of the subject”. The neighborhood is a C4 so we have to paint the subject? LOL!!!
Work samples are intended to provide others with examples of your best work. If this is Mueller’s best REO hybrid sample report, can you imagine what the real stuff looks like?
that is a VERY good point… I’d think Jordan P would probably want to write the ‘sample’ files himself… 🙂
Stupid phones, don’t even have a simple flash mechanism on many of them. I’ll stick with a good old camera thank you.
Some appraisal reports leave you knowing less about a property than if you’d never reviewed it in the first place. The adjustment grid might as well be invisible.
This is the future of appraisal? Don’t you know it that amc’s zipped up all this reo work as well. They’re mismanaging the process of default management to death. There may be an interesting fault and relationship to the way they’re saving all this money on hybrid, only to turn around and bring these homes to market with frt’s whom may rely on these fake appraisal products in the origination phase.
You know, after someone has taken a wash and lost their property, is all lined up for ruined credit, court, lawsuits, and long term debt payments, who cares about that guy. REO management took a real turn south with amc’s. Push the report through quickly with minimum detail so we can get this in the hands of an investor or another buyer pronto.
You accept information that you can not verify, from an interested party, and use that information as the basis of your opinion…………
You will not escape, down the road, when the other side of the transaction is hurt by the use of your biased appraisal.
But hey, lawyers need work too.
Oh yeah. For sure. Absolutely. Right to the point.
You think that disposable inspector is going to have any independence what so ever? Think again.
You think the amc’s whom are dependent on lender contracts are going to focus on independent unbiased process as a first priority? Think again.
Think that a middle manager won’t do and say anything to keep their show rolling? They certainly will.
Lenders with half a clue still insist on direct appraisal assignment, preferring full service appraisals performed by only licensed individuals, and they do not vainly try and force appraisers to work with amc’s. The rest, they’re just a dime a dozen gaming the system. Fraud has become so commonplace in the appraisal management industry, people are not even recognizing this as out of order.
Also, review the copyright laws regarding photography, and then consider how long before nobo inspector figures out they can sue the appraiser for copyright violations for commercial use of their work, when they, the original photo takers, have not given you, the user, release of their copyrights. Oh I’m sure some of them will figure it out in a while, or as soon as their work starts to dry up.
Amc’s have that all figured out. They’re masters of deception at this point. That’s why they’re unwilling to share names, have lobbied against any need to share, and hire disposable workers and bottom dollar servicing companies. Those per diem inspectors will continue to be here today, gone tomorrow.
I don’t think this stab in the back update letter Fannie put out is a coincidence. It’s just like Mr Ford predicted, they’re paving the way for total legality of this practice.
Come to think of it, I like hardly ever use anyone else’s photos. Except for posting original MLS photos so people know I’ve taken unique photos myself.
We’d have to sign up to be photo takers ourselves to read their disclosures and agreements and such. Undoubtedly the amc takes all rights to everything and leaves the independent workers they would engage with in a completely subjugated powerless position. That’s what they’ve done to appraisers so it would only make sense they’d be able to push the line of abusing other non licensed people they work with even further. Amc’s are a total nightmare and it’s only getting worse.
Man, are you sure you weren’t abused by an AMC as a child Baggins? You do know they have counselors for this kind of stuff, right?
You’re really good at this. On a related note, how much income have you made with your wholesale sell out of appraisers best interests approach? We welcome the amc advocates opinions, it helps illustrate to the public and governmental readers whom frequent this website, how the violations of basic decency, ethic, and honest business structures are shaking out.
Greg, you should know that AMC sympathizers are not viewed favorably here. Looks like you made a wrong turn buddy!
See the $275 Dingledorf appraiser thread for additional details.
Hey Jason. It would seem, then, that I’m in the right place. There is no such thing as a wrong turn. There are only turns. You always end up exactly where you are supposed to be. Not sure how I got labeled as an AMC sympathizer, but that is fine with me. I neither work with, nor for, amc’s I simply do my best to try to get close minded folks to open their eyes. Looks like pry bars may be required on this site, but that’s ok. I have time.
Greg, sure stick around if you have time…but know that you won’t be able to convert any of us. Our eyes are wide open!
You say you’re not an AMC sympathizer? Okay. Then I’ll just leave this here 😉
I see you troll just like your friends. Yep – that’s me. I think what I said was that I neither work for an AMC (First Choice is a mortgage lender), nor do I do work for an AMC (as you’ve so adeptly discovered, I’m chief appraiser for said mortgage lender). If you care to dig just a bit deeper, you will probably find that our appraisal fees are among the best in the nation. That is, in my opinion, irrelevant though. What is relevant is that each appraiser should have the right to charge whatever fee they think is appropriate – be it an AMC, a mortgage lender, or any other client, without fear of reprisal from self righteous, arrogant, mediocre fellow appraisers – not that there are any of those trolling on this site.
Take it easy Greg!
I was just responding to your “Not sure how I got labeled as an AMC sympathizer…” statement.
I sincerely apologise if I hurt your feelings, Jason. Not sure what I said that could remotely cause so much pain, though.
And I never meant to cause you trouble
And and I never meant to do you wrong
Exactly! Thank you. Such a great tune.
When an appraiser provides a lower priced service for your company, are cost savings returned to the borrowing consumer, or does your amc pocket the difference.
“Best in the nation”…. For whom?
Yeah, you’re really building an awesome pro amc case by insulting everyone whom does not agree with you.
Apparently English is challenging for you Baggins. I’ll say it again – but much slower this time – I do not work for an AMC. Our fees are among the highest in the nation and the appraiser keeps the entire fee. Let me know if you still don’t understand and I’ll try to say it even slower.
What are we talking about exactly? Your profile which I have read previously sort of indicates a more caring and professional approach to vendor management.
First Choice fees are not the highest in the nation, they’re still under the VA fee schedule but at least are on point with WorkingRE C&R from a few years ago. It’s good your paying full fee. But per the tone, we’ll expect a transition to amc’s soon? Why didn’t First Choice hire licensed appraisers as the effective vendor managers and clerks? Flagstar did that and it’s really great to be able to call in and find all the clerks and effective state managers are licensed appraisers. Why does your outfit use Appraisal Scope, given all the problems and rudimentary issues they have?
Is that a possible conflict of interest, pushing around appraisers whom may be on your panel of vendors on online forums. People wonder why many of us are anonymous. First Choice wasn’t all that to me, I kept up with the other guy. Anyways, don’t take it personally but it’s sort of confusing how you’d promote amc’s this way while supposedly paving the way for better process with the Costco affiliated lender. I’ve been around, and I will continue to be around, don’t worry about me. It might have been a better conflict avoidance method to come out upfront with that rather than leading us towards previous amc development research.
So what’s First Choice up to lately? Are you guys pro hybrid, anti hybrid, pro waiver, anti waiver, are you ever going to come up to the VA fee schedule, etc. Let’s start this over.
It’s also interesting that folks like you and Baggins are all to happy to troll other folks’ personal information, all while hiding behind names that cannot be traced. Quite brave of you both! And Mile called me cupcake…. ?
When dealing with unethical people and groups whom are known to say and do anything, it’s important to find some measure of protection.
We still remember the Pam Crowley days.
Disclosure does not just go away because individuals whom profit through unethical process and behavior decided to ignore the facts.
Trust in amc’s? Never, ever, ever going to happen.
And rightfully so.
I love the comment that the “zoning is legal” hahahaha!
And the neighborhood is typical of residential neighborhoods.
“Typical boilerplate”. Betcha a pepsi if that appraiser has a template, that’s pre filled.
Some ‘appraisals’ are so thin and light, absent of meaningful information, they practically float to the trash can all by themselves.