The lender and the AMC could have applied that veto to the sales agents, using the appraisal as proof positive that the agents derailed this deal. What is the ROV for? The answer is the listing agents pricing strategy and the buyers agents buying strategy. The lender will go through the appraisal with a fine tooth comb and microscope, while ignoring the fact the initial BPO and CMA which led to the listed price the contract was formed around, was totally inadequate and riddled with errors. Clearly off the page in relationship to existing market value indicators. I’ve seen numerous...
Your trade has been under assault for years. The de minimus rule was the first I sensed of the end of your trade. I am going off of vague memory but I think it was 1997, and at the time, the near majority of my town was below the $250,000 threshold, as were 90% of the towns adjacent. I remember an old horse telling me the handwriting was on the wall for him and his kind. As I reflect on it there have been repeated efforts to pare down the costs of borrowing by trimming fees for title and other...
Vote with your wallet. Vote with your feet. Vote with your time. Vote with your patronage. Vote with your clicks. Sorry to inform those who are seeking someone else to bail them out of this continued blatant abuse of power and ongoing racketeering enterprise known as Appraisal Management Companies (AMCs). We can’t boycott the AMC industry twice. It’s your turn now. And that’s the rub, it’s our industry, not some other groups industry. Without appraisers, there is no valuation services industry. The appraisal management groups presence is irrelevant unless appraisers choose to make the AMCs relevant with patronage. Each appraisers...
A bill to amend Illinois’ appraiser and real estate licensing acts to address discrimination. With increased public attention on the issue, complaints alleging unlawful discrimination are emerging in the courts and before regulators in relation to appraisals. In Illinois, a bill (HB 5862) has been introduced to amend the Illinois Real Estate Appraiser Licensing Act and the Real Estate License Act to expressly prohibit discrimination in appraisals, broker price opinions (BPOs) and comparative market analyses (CMAs) for residential real estate. The bill would amend each licensing act to state that an appraiser or real estate licensee engages in prohibited discrimination...
Over 11,000 appraisers signed that petition… The US Congress completely ignored it and, as a result, The Great Real Estate Depression followed. Déjà vu: Or is it Déjà Poo (I’ve heard this crap before)? The Collective Rot Growing Within the Shadows of the Great Real Estate Depression We are just 11 years past the beginning of the Great Recession. Some estimate the US suffered a $14 trillion loss in wealth. Others estimated the loss as high as $21 trillion. This event is more commonly referred to as The Great Real Estate Depression by those of us who are or were in the real estate industry...
Another Meltdown – The Inevitable Outcome of a White Swan: Why would we allow another Financial Meltdown to occur? …When revenues and profits decline, lenders and financial institutions throw caution to the wind and relax their once prudent lending policies in favor of more aggressive, inclusive policies… Hindsight has taught us that there is no serious consequence to imprudent lending policies. Perhaps a multi million dollar fine is assessed but that is just the small cost of doing business for some violators… Though more common now, especially in Australia, Europe, and Asia, black swans (Cygnus atratus) were once thought to...
It is my hope that the Subcommittee on Housing, Community Development and Insurance consider long-term impact. The existing regulatory burden, a proven failure, may insure a repeat of the past. The body of a letter to the U.S. House Committee on Financial Services about systems reform. Appraisal reform or Appraisal industry reform? It is critical to understand that ‘appraisal’ does not equal ‘valuation’, or risk analysis, or anything else. It is a precise definition of a nebulous product. The current U.S. House Committee on Financial Services is asking the question: “What’s Your Home Worth? A Review of the Appraisal Industry.” I believe it is...
I saw a posting by another appraiser on a Facebook page on February 5, 2019 that MCS Valuations, based in Lewisville, TX, is closing shop. They are an AMC, and provide BPO’s and other real estate related services. The appraiser posted a letter from the company. They will not be placing any more appraisal assignments, but are asking appraisers to finish any assigned reports already in the pipeline. What’s really striking about this closure is that in 2014, MCS Valuations bought ‘components’ of CoreLogic’s associated entities that CoreLogic no longer wanted in their business! February 5, 2019 This communication is to inform...
An Appraiser’s First Impressions of Clear Capital’s AVM… It’s no secret the lending industry is aggressively pursuing alternatives to traditional appraisals. While most participants in the industry will concede an appraisal is still the gold standard for collateral valuation, they increasingly see the appraisal as something to be steered around or avoided altogether. An array of products/alternatives are being bandied in lieu of a traditional appraisal: Hybrids, Evaluations, BPOs (broker price opinions), Desktop Appraisals, and outright Appraisal Waivers. The industry is also turning its attention more and more to AVMs (automated valuation models). AVMs have been around for nearly three...
Appraisal? Obviously its only worth ten bucks – off to India with it… Most appraisers (and consumers) know the difference between ‘right and wrong’. We don’t need the tortuous, twisted ambiguities of ASB straddling the fence, on all issues to know what is and is not okay. So far ALL they do is hypothesize that bad products can theoretically be used, IF they conform to all the USPAP rules that we all already know they fall short of. As in every single exception being sought for regulatory exceptions in the financial sector, only impractical, not very probable, best case scenarios...
