New Suspicious Law in CA

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Dave Towne
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Suspicion of a Discriminatory Appraisal... New Suspicious Law in CA

…any suspicion of a discriminatory appraisal by the holder of a real estate appraiser license…

Folks in the Golden State, here’s something you’d better keep a very keen eyeball on:

Appraiser Discrimination – AB 948 (Holden) Signed by Gov. Newsom

This law requires a purchase agreement in a real estate transaction to inform a seller and buyer of the opportunity to report, through the Department of Consumer Affairs’ internet website or telephone number, any suspicion of a discriminatory appraisal by the holder of a real estate appraiser license. Furthermore, it would require such a notice to be provided by a lender when a buyer is applying for a loan. Finally, the bill will make changes to the fair housing law to apply the law to appraisal discrimination and refinancing transactions.

Further, I’d suggest the various appraiser organizations in CA band together in a cohesive group and really STUDY what this new law actually says, to determine what the aggrieved party can and CANNOT do in terms of filing a complaint against a LICENSED appraiser.

Suspicion is a dangerous word. It could turn into situations very damaging to appraisers.

I suggest a CE class (or 2 hr seminar) be written and shared with each of the organizations so that LICENSED appraisers can become intimately familiar with this law.

I stressed the word ‘licensed’ because those of you who are not licensed, and do no FRT assignments appear to be “off the hook” presently. But that could change in the future.

This bill, among other things, would require the bureau to place on an existing complaint form a check box asking if the complainant believes that the opinion of the value of the real estate is below market value. The bill would also require the bureau to collect specified demographic information, voluntarily provided, regarding sellers, those seeking to refinance, buyers, or an authorized representative in real estate transactions making a complaint. The bill would require the bureau to compile the collected demographic information and report that information to the Legislature on or before July 1, 2024.

This bill would require, beginning January 1, 2023, an applicant to complete at least one hour of instruction in cultural competency, as defined. The bill, as part of the continuing education requirement in order to renew a license or restore a license to active status, would require for each licensee renewing on or after January 1, 2023, at least 2 hours of elimination of bias training. Beginning January 1, 2023, a licensee would be required to complete at least one hour of instruction in cultural competency every 4 years.

George Dell is an acquaintance of mine, and I’ve taken two classes from him.

This Friday, at 12 noon PACIFIC TIME, he will be presenting a FREE webinar focusing on avoiding bias in your work.  Co-presenter is Peter Christensen, Attorney.

If you’ve been following all the media harangues with multiple stories (usually the same stories repeated in separate sources), you know that “bias” is the new buzz word painted on appraiser backs.  The reason this is happening is not really a secret anymore; it’s part of the “political agenda” promulgated by certain people.

This webinar may help you avoid issues where a borrower or client may get the impression that you are ‘biased’ in your work, and in the value you report.

If you want to take the webinar “How to Avoid Being Accused of Bias, Register Here!

In case you missed his “Market Price Indexing: Peaking Prices?” webinar, you can watch it below.

Image credit flickr - romana klee
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on e-AppraisersDirectory.com

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18 Responses

  1. Avatar Koma says:

    Just wait til the market downturn then these types of complaints will skyrocket. Still haven’t seen any proof from these accusations.

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    • Baggins Baggins says:

      They will discover one portion of market participants complain more than others. They will point to ‘the data’ as proof positive of ‘appraisal bias’. Value pressure will be applied. Predictable.

      3
  2. Brian Kirkpatrick on Facebook Brian Kirkpatrick on Facebook says:

    Dumbest cancel culture thing ever created. We report economic conditions based on data created by others….

    5
  3. Avatar gws says:

    Look at the source. A complete idiot running the 7th or 8th largest economy in the world into the ground. If it happens there, only a matter of time before it comes to your state. I stopped doing bank work 6 years ago.. .

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  4. Baggins Baggins says:

    What happened to the appraisal value pressure hotline? Meanwhile, realty agents continue to use price and value language interchangeably, clueless of the difference. “Did this come in at value?” “If you are having trouble with value, let me know.” “Did your report make value?” “Let me know if this may be short on value.”

    Acceptable market value to whom specifically? Buyer or seller? People embrace this illusion that real estate is always fair, regardless of the position or interests of the individual participants. In a sellers market, buyers always lose. In a buyers market, sellers always lose. In the effort to create better affordability with suppressed interest rates, they’ve caused pricing to become unaffordable, cutting the poorest out. Make it make sense.

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  5. Avatar Seneca says:

    So would it be an issue if you back out of an assignment when you find out who the borrower is based on protentional liability but base the reason on something else?

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  6. Avatar Mary says:

    “The complainant” can report if they feel the value is below market value! Gimme a break. Are these people experts in market value analysis and interpretation. Of course they will say the value is below market if they don’t like the Appraiser’s number. This is insanity. When thousands of us bow out of the lender market due this kind of law (I am so glad most of my business is non lender but I will have to make that 100% non lender soon) they will be singing a different tune. Pretty soon they will tell us to use comparable sales in superior valued neighborhoods in order to eliminate BIAS! That will be coming down the pike just watch and when it does we better ALL tell them what they can do with that kind of request! The buyers are the ones who dictate value, so they need to ask why the BUYERS/Market are Biased, not the Appraiser who comes in after the fact in most cases. Just because of 1 or 2 bogus news stories that were not fully investigated this is what the result is by law makers who have NO clue about what we do. Well they will be in for a rude awakening.

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  7. Avatar gws says:

    I lost a very large account due to a lender using AVMs. Does this law pertain to them (AVMs) as well?
    How about BPOs?

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  8. Cheryl Ferguson on Facebook Cheryl Ferguson on Facebook says:

    Particularly in CA where BREA investigators will literally open an investigation for a literal TYPO in an appraisal report!!!! I guess they need more workload for their investigators. I am certain any “suspicion” will be assumed to be a violation on the appraiser’s part.

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  9. Eric Kessin on Facebook Eric Kessin on Facebook says:

    Translation – if you are in a minority group, and the appraisal is lower than you expected, the appraiser is racist.

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    • Baggins Baggins says:

      The appraisers are racist argument is one degree away from a Geico commercial.

      If there is any training necessary, it’s construction principals and material worth.

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  10. Avatar E J Brownn says:

    I’m thinking of doing a refi. In my opinion my house is “reasonably worth” $180,000 but any info I can find on line says $275,00 we’re free & clear & 71 yr old. Should I cash out & running?
    We have a cabin to disappear to. Oh yeah, I have a Latino wife who’s probably in the bias category.

    1
  11. Avatar E J Brownn says:

    I’m thinking of doing a refi. In my opinion my house is “reasonably worth” $180,000 but any info I can find on line says $275,00 we’re free & clear & 71 yr old. Should I cash out & run?
    We have a cabin to disappear to. Show me the money !!!

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  12. Avatar JohnnyQ says:

    Cultural competency? WTH is that and what does it have todo with what buyers and sellers do in any particular market sector.

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  13. Avatar CJK says:

    If a buyer or seller believes that the appraisal has been influenced by any of the above factors, the seller or buyer can report this information to the lender or mortgage broker that retained the appraiser and may also file a complaint with the Bureau of Real Estate Appraisers at https://www2.brea.ca.gov/complaint/ or call (916) 552-9000 for further information on how to file a complaint.

    So it they believe NOT if they have proof? Well I believe that I am a rich young black woman who is trapped in a poor old white mans body, as for proof why do I need proof, I just believe. The best course of action might be to just stop talking to people at the property. How would the buyer even know 99% of the time I never even see the buyer.

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  14. John Gazsi on Facebook John Gazsi on Facebook says:

    Going after all the white males over 50′ the rest of you are not the target, don’t worry its a witch hunt to justify diversity like Better Mortgage has exclaimed… they will be the next CountryWide to fall from fraud…

    2

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New Suspicious Law in CA

by Dave Towne time to read: 2 min
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