Homeowner Rejects Hybrid Appraisal
Appraiser Alert: Don’t Mess with a 4’ 10” Senior Citizen!
Last week I called a borrower to schedule the appraisal appointment. She asked me some very odd questions; “Are you a licensed appraiser? What is your license number? How can I verify this information?” Well I had never been asked any of these questions in my entire career, but I answered as there really wasn’t anything I was hiding.
It was 19 degrees outside when I arrived at the property and this senior citizen, not more than 4 feet 10 inches tall, was sitting on the porch. I proceeded up the porch and introduced myself, handed her a business card and put out my hand as I always do. She did not shake my hand, but instead she asked if I had identification. I showed her my driver’s license. Then she asked, “what about a copy of your license?” Well after a struggle to get the thing out of my wallet, I showed her my wallet license card. At this point, she said, ok let’s go inside where it is warm.
Once in the house, she apologized for her bluntness. She then explained she had a bad experience with another lender. She proceeded to tell me; “They sent someone to my house to look at the property. I let this person go through my home, into my bedroom and everything. They even took pictures.”
I stated that we are to observe all areas of the home, take photographs of every room and that was normal.
She replied.
“I know what an appraiser does. I retired from the banking industry after 45 years. The person they sent to my home was not an appraiser. He called himself a property inspector. He explained he did not appraise the property and was there to make notes and take pictures. He did not work for the appraiser and did not even know who the appraiser was or what the process of appraising entailed. This person was a stranger in my home and had no credentials, license or professional affiliation. As an elderly single woman, who lives alone, a fear came over me and I told him to leave.”
We talked a bit and I explained about hybrid appraisals and how appraisal management companies and lenders were pushing these products thinking it will reduce the turn-around time to get an appraisal.
Her response:
”That is the most asinine thing I have ever heard. The property observation is the most important part of an appraisal. It is what the appraiser uses as the foundation of the report. It is the information that comparables are selected from. Who in their right would think this is a smart thing? This has fraud written all over it.”
I asked her more about her background. In her 45 year career, she started as a Teller and worked her way up to Regional Manager, then Corporate Trainer. She retired as the Senior Vice President of Compliance.
This feisty 4’ 10” senior citizen kicked the property inspector, hybrid appraisal and lender to the curb…
I could not think of a better way to end the year.
By TJ Everett, Certified Real Estate Appraiser
I Loved This Story.
Sounds like my grand mom.
I had a lady ask me these questions once. When I got to the house she asked for my ID they the door as well as my appraisers license. She opened the door a few minutes later and apologized. Flashed her ID and badge….FBI. Can never be to careful.
That is just awesome!!! Hope we can still spread the word of this nonsense!!!
This is great! But that’s because she understood the process. Most owners don’t ask these questions.
Abby, You are correct. Most homeowners do not understand the process. That is why it is important for all appraisers to talk with their friends, neighbors, etc. Share these stories with your friends on social media; Linked In, Facebook, etc. That is how appraisers can spread the word around. Just imagine how many people could be reached if every appraiser shared this story with all their Facebook friends? We have those tools at our fingertips. Please share, like and repost to protect the public trust.
Colorado, in it’s infinite now liberalized wisdom, no longer issues wallet cards on official secure printed paper to appraisers. Their idea of saving paper is to send me a digital and have me print this myself. The last license I got said printed on secure paper. This time I had a digital only. Official documentation matters. Official licensing matters. The state of CO regulatory authority persons have ignored my emails regarding this matter. I am no longer able to pull out a wallet card. Anyone with photoshop can get into these lines of work these days. Who was that ‘inspector’ and where are they sourcing this lower priced labor?
At least they send you one! Many years ago I reduced and reduced and reduced my actual license to wallet size and had it laminated – then the state started telling us we could not copy state licenses under any circumstances (about when lenders started requiring copies). Now people still routinely copy them out here, but in my state I’d urge caution. They love to set up ambiguities and then drop the hammer on people later when they decide NOT to look the other way anymore.
California! Pull your head out and start issuing wallet ID cards with the newly jacked up renewal fees.
This had to be coach Tubby Smith’s wife. She put me through this crap and I told her she needed to find another appraiser. Their house was 10,000+ sf and I had no desire to have this old B*T$H following me around berating me for 2-3 hours. Unlike the woman in the story, there was NOTHING warm and understanding about Mrs. Smith. This was the only client I’ve ever had to fire.
Great story. I would have done the same thing. (Can’t be too careful!) I’ve been appraising houses for 35 years. I carry a laminated copy of my license with my photo. I also explain about taking interior photos when I schedule the appointment. I’ve noticed a lot of my assignments are senior citizen women. I don’t mind “profiling” if it puts people at ease. ?
My kind of gal, good for her.
Great story. Thank you for sharing it!
At issue here is that the borrower must blindly TRUST that the lender has their best interests in mind when they shop for an appraiser, or alternate system to determine a property value. When on a federal level the separation of fees (appraiser/AMC) is not required, its obvious from the start its a shell game to hide the truth (fee paid to the appraiser) from the borrower. If the true cost of the appraisal is hidden, why not attempt to hide from the borrower who it is who is inspecting your property.
Thanks for sharing this story. I’ll “rebroadcast” it later. A key problem and issue is far too many lenders and their AMC minions are in lockstep over these ‘hybrid’ appraisals that use undocumented ‘property inspectors’ to examine and photo the subject before the appraiser even gets the assignment to complete in-office, while wearing bathrobe and bunny slippers.I’ve been writing about the craziness of these new products for over a year. I have warned appraisers to be very cautious about doing them, be cause the actually MAY violate your responsibility under USPAP, although most are ‘sold’ as being compliant. FORMS are not compliant, but appraisers must be.
I inspected the home of a corporate attorney just the other day. He recently left a large financial institution and went with a manufacturing company. He told me he left the financial institution because they were not listening to the attorneys who were advising against all the automations and short cuts they wanted to do.. Artificial Intelligence was creating more problems than benefits. I explained about hybrid appraisals and how they were attempting to shorten the time for faster and cheaper. He nodded his head and said that was a key topic over the past year and not one of the 3 attorneys on staff recommended taking that short cut. He said all those mortgages will be buy backs from the investors in a few years and it will cost the company significantly more than the few days it may have saved. I am glad at least a few people on the other side understand the issues with these products.
That lady sounds like my Mom! She should be heroine to all of us!
Was getting my home appraised recently for a refi and the inspector wasn’t calling to schedule an appointment (10+ days). Finally the lender told me to call him. Luckily I Googled him before calling. He had recently been arrested for mortgage fraud and money laundering. Was facing 100 years in prison and the lender had no idea.
Wow!
Even one of those nifty $60 background checks done six months before wouldn’t have picked that one up. Great vendor vetting by the AMC.
We should have some kind of wallet size photo id that verifies that we are appraisers. Anyone with a professional license should have some kind of wallet size photo id.
Maybe someone should forward to AMCs who are going this way fast. I just got a call from a new company wanting to sign me up to give them my inspection business.
Great Story!
I always give the owner or Realtor my card upon arrival. That seems to smooth the way. After 30 years doing appraisals never do I remember ever having someone being so suspicious. If they get rude and demanding I’m always ready to turn and walk away. Life is too short to suffer through any bull s**t from the owner on top of all the bull s**t dished out by the AMC and army of draconian reviewers……………….
I believe the point is what the AMCs are doing based on USPAP.
I had an inquiry about doing a Hybrid several months ago. I suggested that they send me what they had so I could take a look and see if I could help them. They sent a report with minimal photos. The inspector indicated that it was in need of about $2000 or so in repairs. My assessment just from his front photo was that $10K might not be enough. Google photos revealed what looked like an abandoned property. The KICKER… The report was signed by a Real Estate Broker… I looked up his/her name in the State Records and found that they were from a town some 150 miles away. I know they didn’t drive all that way to do a quick/inexpensive inspection. Who knows who they hired locally to do it. Needless to say, I informed the lender that I’d have to do my own inspection. Haven’t heard from them since. Just hope they got smart. No Hybrids for me!
The circumstances you outlined will be the rule rather than exception.
This would be a GREAT article to submit to AARP and similar publications. Elderly, retired people with experience the likes of this woman are still very active in their communities and society. They like nothing better than to share / spread their knowledge and experiences 😉