You are the primary target on FHFA, unfortunately. They are going after those doing credible reports.

Exactly. Simple rebuttal lines for professional appraisers may include; Where does the instant equity come from, for the +$45k offer? Now either the buyer is offering over market, or the selling agent failed to list at market, so which is it? (Don’t let them shift blame for this activity to appraisers.) We also used to refer to these types of deals as being possibly straw buyers to artificially prop up pricing so other moneyed interests could cash out or drive up their rental costs if they owned multiple properties in the area, skewed indicators, outliers.

This is why I comp search everything prior to accepting orders. The figure to comp search is the offered price, less any appraisal gap. Otherwise it’s simply an over market offer which could also be considered defrauding the lender, to entice the commission based agents to all rake a higher commission, by developing a loan for real property at a price point which can not be proven by bonafide closed sales.

Basically the new reality is the same as the old reality, and hopefully more appraisers recognize the importance of the act of comp searching everything before order acceptance.

$499k to $545k = + $46k / 2.5% commission = $1,150 additional commission over the initial base commission. $499k / 2.5% = $12,475.

The commission based agents become unable to see clearly or represent fairly, when an additional thousand dollars worth of potential commission is just sitting on the table.

Two firm rules for appraisers whom want to participate in mortgage lending; Direct assignment only. And requiring the lender to employ a licensed appraiser as their head of the appraisal distribution department. Amc’s don’t count, as the lead panel manager appraiser is shielded by the amc company license, so they basically can get away with any and all forms of applied pressure. Individual accountability matters.

Your observation is spot on not to mention the listing Realtor has failed their fudiciary responsibility to the seller by under-listing the property based on the Realtor argument. Realtors do not typically “under-list” a property but no one wants to recognize that. “Pay no attention to the man behind the curtain”.

I just “biased” myself an appraisal to Johnny Q. Listed for $499,000, bid up to $545,000, appraised value $520,000. The subject is inside a 325 unit condo project where 23 units have sold in the past year all for $520,000 or below. Being a semi-flipped property (Renovation Reality), the subject warrants a premium, but with an active model match located directly above ($499,000 / adjustments warranted), market value is $520,000.

What’s funny about bias Johnny Q, was the agents attempt to justify a value of $545,000 considering her knowledge from three days earlier (the list date) reflected a value of $499,000.

Seek the truth.