ND Requesting a Waiver for Five Years!
The Most Important Issue Facing The Appraisal Industry RIGHT NOW
If you thought the answer was the House “modernization” panel discussion that occurred in front of the House Financial Services Committee this week you were wrong.
The state of North Dakota is attempting to obtain another waiver request, not the laughably written request of last summer. Now North Dakota is requesting a waiver for five years!
From the Federal Register
The request seeks a waiver of appraiser credentialing requirements for appraisals for federally related transactions under $500,000 for 1-to-4 family residential real estate transactions and under $1,000,000 for agricultural and commercial real estate transactions throughout the State of North Dakota for a period of not less than five years.
Lenders don’t want to pay market rate fees so why not have bank employees make the numbers up. What could go wrong? Here is the anti-appraiser propaganda web site CSBS that somehow ignores this point. Perhaps next time the North Dakota governor will sign off waiving licenses for doctors because there aren’t enough? This is an economic issue plain and simple.
This request was filed on May 30th with a 30-day notice for comment. Time is running out! ASA has a landing page for appraisers (and anyone else) to provide comments. There is a public hearing on July 9th (I wish I could attend but I am providing expert witness testimony that day) so please try to attend. It will make a difference when the regulators see our industry’s concern.
ASC Notice for Comment – North Dakota Temporary Waiver Request
This places the taxpayers on the hook for the aftermath and is an insanely irresponsible request to make given the global financial crisis we just went through. History is repeating itself. Appraisers need to get the word out!
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Step up people! Submit your comments.
These lenders could financialize the problem, create good paying staff appraiser jobs where that local appraiser also trains other local appraisers. There sure are a lot of amc’s operating and paying fees to be on the roster in this state. I wonder if they’ve had any negative influence. (From the states reg board; amc roster doc)
The lenders do not want to pay for any staff appraisers, when they know that the tax payers will be stuck with the bill when the loans go into default. They always seem to be looking for a work around.
Lender: We do not have any appraisers to do all of the work.
Appraiser: I have years of experience, hire me on staff and I will do the appraisals for you.
Lender: Hell no, we do not want to spend any money, we want to make money.
Appraiser: What will you do when the waiver loans go into default?
Lender: We do not care, as long as we make the money up front, that tax payers can cover it later.
FNMA: That sounds great we will be offering even more waivers, the treasury has the money to cover it all.
Tax Payer: What the hell is going on with theses lenders, how many time must we bail them out.
Appraiser: Now working at Walmart, we tried to them tell them but no one cared to listen.
Washington: Let’s have another meeting on the subject, just like in the 1980s and again in the 2000s.
North Dakota home values will be TOAST when oil price crash/recession comes.
The average salary in North Dakota’s oil and gas industry is $120,405.
When all of those jobs evaporate….. foreclosures will follow.
ND about to “Waive” themselves into a crisis.
SB’s comment is really remarkable, so I will post a remark. The effective date is on the first page of every appraisal. The appraisal is NOT a forecast of value in the future. In 2007, a house might be appraised honestly and competently at $500,000. The same house might be worth $300,000 in 2009. Appraisers would say, “the market changed.” So investors and lenders say, “then what good was the appraisal?” There is a fundamental mismatch between what appraisers provide – a point in time estimate based on history – and what the ultimate investors in the loans want – a backstop against financial loss. BTW would you trust the average appraiser to forecast world oil prices, their effect on local wages and employment, and the resulting effect on home prices, either in the aggregate or the particular?
AGA, OPEIU #44, AFL-CIO has previously written opposing this. Now the state has put together impressive charts and graphs to ‘prove’ shortages.
Nicely done, since their own data proves that no actual shortage exists, except perhaps enough appraisers willing to work for discounted fees that would also be willing to overlook the complexities of rural appraising in their completion time estimates.
Simple test. Take the total population of ND and divide by the number of appraisers there. Your per capita result will not be much lower than the state of California, and if considered on the basis of certified appraisers, it may actually be higher. Odd how the state of ND ignored the ONE test or metric that could have demonstrated a shortage if one existed. Comparison to other states with much higher transaction volume, where it is known no shortage exists.
They went to great lengths to stack the statistics deck. That alone should be viewed skeptically.
North Dakota’s numbers are actually higher than Tennessee’s were for their declined waiver submission.
We have no shortage in California.
The MOST difficult of all common assignments, whether residential; 2-4 units or commercial/industrial and agricultural are those that are done in rural areas.
Responsible lending policies would dictate greater rather than reduced collateral verification by professionals specially trained to appraise such property in rural areas. Jonathan Miller is 100% right. This is nothing more than a ploy by commercial banking interests to use the political process to circumvent federal laws established under FIRREA; Dodd-Frank and various other regulations.