selling guide - Appraisers Blogs

Fannie Mae Filed a Complaint Against Me

AppraisersBlogs — Wed, 18 Oct 2023 12:30:39 +0000

An appraiser shared the following with us which was posted on one of the appraisers’ groups. Fannie Mae filed a complaint against me with my state appraisal board. Here’s what happened. The Report In June of 2021, I completed an appraisal for a conventional purchase. The appraisal was ordered by an AMC on behalf of a lender. At that time, the real estate market was still being wildly affected by the COVID pandemic. Remote work was in full swing, and consumers were desperately seeking to get out of the cities. Prices for all types of residential properties were rising rapidly,...

Fannie's Loan Buyback Sophistry Relies on Modifying… “Many of the repurchase letters make no sense,” said the insider. If analysts don’t write enough defects on those files,…
FNMA Continued Effort to Get Rid of Appraisers Fannie Mae Continues Their Effort To Get Rid Of Appraisers: Sends “Tips” For the past year, Fannie Mae has sent…
The New & Improved Fannie Mae “FRAUDULATOR 2.0” Originally known as Fannie Mae’s Collateral Underwriter (CU), and subsequently Collateral Underwriter 2.0 (CU-2)i this always dubious product of Fannie…

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Dear Representative, FNMA Has Gone Rogue!

AppraisersBlogs — Mon, 27 Mar 2023 12:30:24 +0000

Dear representative, waiving/eliminating property appraisal for lending purposes is wanton recklessness. Fannie Mae’s decision to waive/eliminate property appraisal for lending purposes is nothing more than wanton recklessness that could have serious repercussions in the future. The truth of the matter is that appraisals are an essential part of any mortgage transaction and should not be taken lightly or eliminated without due consideration. Without them, there can be no assurance as to whether a homebuyer will get what they pay for or if lenders will make bad investments with their money. In short, waiving/eliminating property appraisal requirements puts everyone at risk...

No Appraisals Required. The End of Appraisers? No appraisal may be required in the future! Fannie Mae took a direct shot at appraisers with the announcement of…
AVMs... Garbage In, Garbage Out Garbage data in means garbage results out every time! It's no secret that AVMs have been a thorn in the…
Exactly How Are Property Data Collectors… Somebody explain to me exactly how Property Data Collectors are “professionally trained” per Fannie Mae directives. The fact is, Fannie…

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No Appraisals Required. The End of Appraisers?

Hamp Thomas — Thu, 09 Mar 2023 13:30:37 +0000

No appraisal may be required in the future! Fannie Mae took a direct shot at appraisers with the announcement of changes in their Selling Guide. Two options for the future, both of which do great harm to the appraisal industry. First, “third party” inspections. Appraisal trainees aren’t good enough, so now we will have unlicensed inspectors going through the homes of unsuspecting homeowners. And, with this inspection a traditional appraisal is no longer a requirement for the mortgage loan. Secondly, the 3rd party inspection is sent to a licensed appraiser. Fannie Mae wants an appraiser’s signature so the appraiser can...

Exactly How Are Property Data Collectors… Somebody explain to me exactly how Property Data Collectors are “professionally trained” per Fannie Mae directives. The fact is, Fannie…
Uncovering Flaws in FHA Appraisal & Loan Review Process The story of this single mother's harrowing experience with a defective home purchase and HUD's negligent oversight exposes deep flaws…
Desktop Appraisals: Has The Devil Infiltrated The… Are desktop appraisals with third-party inspectors protecting the public, or are these products about to destroy the very profession I…

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Speed Regardless of Accuracy Under the Banner of Modernization

Dave Towne — Wed, 08 Mar 2023 13:30:54 +0000

Appraisers, something – comparing and contrasting – dawned on me last week, after reading another news release titled “Dean Kelker: Appraisal Modernization is Starting to Gain Momentum“, which is basically pushing an “Enterprise” singular ‘agenda’ of valuation speed regardless of accuracy. Under the banner of “modernization.” VA does not demand appraisers complete assigned appraisal assignments extraordinarily quickly. They give appraisers 7 – 10 days (depending on location) to submit the report after assignment. VA expects good quality and accurate information. FHA/USDA/ONAP also expects appraisal accuracy using an inspection protocol that many appraisers object to, and some choose not to do...

Exactly How Are Property Data Collectors… Somebody explain to me exactly how Property Data Collectors are “professionally trained” per Fannie Mae directives. The fact is, Fannie…
Modernization Should Only Be Determined by the… The appraisal professions should be the only ones to determine any modernization; whatever that is... When Things Don’t Go as…
Expert Wants to “Eliminate” Appraisers Mortgage Industry Expert Wants to “Eliminate” Appraisers – A Response The National Mortgage News website just published an interview with…

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Exactly How Are Property Data Collectors Professionally Trained?

Dave Towne — Fri, 03 Mar 2023 13:30:51 +0000

Somebody explain to me exactly how Property Data Collectors are “professionally trained” per Fannie Mae directives. The fact is, Fannie Mae is explicitly working toward the elimination of appraisers for real property valuations. This is in their latest Selling Guide Announcement SEL-2023-02 to the Fannie Mae Selling Guide: Value acceptance + property data is a new option that utilizes property data collection by a third party who conducts interior and exterior data collection on the subject property. To ensure consumer protections, the lender must verify and be able to demonstrate that data collectors are vetted through an annual background check,...

Is the GSE's "Appraisal Modernization" Really Just… Mass Appraisal tend to exhibit a regressive nature... In the intricate landscape of real estate mortgage financing, the notion of…
Desktop Appraisals: Has The Devil Infiltrated The… Are desktop appraisals with third-party inspectors protecting the public, or are these products about to destroy the very profession I…
NAR Concerns & Survey on Property Data Collectors NAR is conducting a survey and wants to know if you have any concerns regarding property data collectors, if the…

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Remove Predominant Price from New Forms

Dave Towne — Tue, 04 Oct 2022 12:30:40 +0000

Something that has ‘stuck in my craw’ or ‘frosted my cookies’ for years is the nonsense about stating a specific “PREDOMINANT” price for neighborhood homes. And then being forced to explain why the Opinion of Value is not precisely that number, and if not, why not. Real estate is IMPERFECT. Properties, especially comparables, seldom, if ever, sell for the very same or extremely similar prices. If that is the case, how can there be an exact “PREDOMINANT” figure? The possible exception to this are highly dense urban developments where the new construction homes are cookie cutters, and the builder sells...

Are Floor Plans in Your Future? A floor plan is supposed to be included in Desktop & Hybrid reports. How will that be done? Appraisers, I’ve…
UAD 3.6: The Appraisal Industry’s Shiny New Straightjacket UAD 3.6, the appraisal industry’s shiny new straitjacket, promises efficiency but threatens to bury appraisers under a mountain of data…
Proposed Design of the URAR Here’s the link to the ‘slide show’ the GSE’s have produced showing proposed design of the future, revised, URAR appraisal…

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Sales Comparison Approach is Racist

Dave Towne — Thu, 28 Apr 2022 12:30:37 +0000

“…the modern appraisal industry perpetuates racial inequality through its continued use of the “sales comparison approach”… the sales comparison approach persists as the dominant method of assessing home value… the sales comparison approach — the most used method for contemporary residential appraisals — perpetuates inequities through maintaining historical hierarchies and current racialized definitions of comparability…” Appraisers, here’s a YouTube video that you MUST view. This person’s, Dr. Elizabeth Korver-Glenn, PhD, work is one of the key reasons why there is so much chatter about racist appraisers in the US. Her discussion of her book ‘Race Brokers‘ begins at the 8:30...

Is Race Baked into Big Data? Chicago appraiser and friend (even though she calls me “fancy pants”) writes a stellar explanation of what an appraiser actual…
Racial Bias: Redlining in the Modern Era ...are they behind this modern day redlining?... The broad definition of an algorithm according to Merriam Webster’s Dictionary is “a…
Appraisers Don't Use Race Appraisers don’t use race... Race is NEVER considered during a valuation Last week in a congressional hearing on the future…

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Condo Appraisal Protocol Changed

Dave Towne — Tue, 01 Feb 2022 13:30:15 +0000

Fannie Mae’s sweeping new national condominium regulations… Appraisers, Fannie Mae has changed inspection and reporting requirements for Condominiums, effective January 1, 2022. The article titled “How can appraisers evaluate aging condos without docs?” from Loop North News has info: From the article: 24-Jan-22 – Fannie Mae’s sweeping new national condominium and co-op apartment lending regulations were created to protect residents, but the tough rules do not cover all the problems, appraisal experts say. High-rises with “aging infrastructure and significant deferred maintenance is a growing concern across the nation,” noted the Fannie Mae memorandum, issued as a result of the tragic...

The Town With No Bank: How Rural America Lost Its… For decades, we’ve been told that the problem is demand. That people don’t want to live in rural America anymore.…
Removing the Definition of Personal Inspection Why is the ASB proposing to remove the definition of Personal Inspection? Several days ago, an appraiser posted the following…
Diatribes Against Appraisers What’s even more frustrating to me is none of the well-known appraiser organizations have offered any public rebuttal to any…

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Are Floor Plans in Your Future?

Dave Towne — Wed, 24 Nov 2021 13:30:10 +0000

A floor plan is supposed to be included in Desktop & Hybrid reports. How will that be done? Appraisers, I’ve recently been studying a ‘word change’ in various GSE documents. This change happened initially in March 2020 in the COVID era revised ‘flexibility’ Assumption and Limiting Conditions and Scope of Work attached to residential reports, and was further incorporated into TWO new appraisal forms issued in July 2020, which you might not even realize they exist! The word change was subtle, but has major implications for appraisers. The change is ‘sketch’ to “Floor Plan.” But when I inquired about this...

Sketch or Floor Plan? The FLOOR PLAN has all the elements of a SKETCH... Appraisers, I was given some ‘inside info’ about DESKTOP assignment reports…
Desktop Appraisals: Has The Devil Infiltrated The… Are desktop appraisals with third-party inspectors protecting the public, or are these products about to destroy the very profession I…
Desktops Are Being Done WRONG! Appraisers, back in April, I was notified by someone “close to the action” of appraisal report submittals to the GSE’s,…

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Highest and Best Use

Dave Towne — Mon, 21 Sep 2020 12:30:26 +0000

Appraisers, I had a recent discussion with a review appraiser, who discussed a ‘situation’ with me. It involved Highest and Best Use (H&BU), and the appraiser’s reluctance to re-do a report so that a loan could be made. The appraiser had checked the H&BU question box on page 1 of the 1004 form as “NO”, which immediately stops the lending process. This H&BU topic is sometimes difficult for appraisers due to many variables which need to be analyzed. The twisted part of this situation (which influenced the appraiser’s H&BU reporting) is the property is in an area where some, not all,...

Solving the ANSI Measuring Dilemma ...a brilliant ‘work around’ to solve the subject & comps adjustment issues, which Fannie Mae thinks is no big deal...…
VA Appraisal Request Form at Heart of AIR Violation… While the statute doesn’t explicitly mention that providing a loan amount is an AIR violation... When a mortgage lender seeks…
Property Data Reports for Appraisal Waivers These Property Data Reports have a higher level or different reporting requirements than ordinary traditional appraisals. Appraisers, on Tuesday 5/24/22,…

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Fannie Mae’s ADU Policy Updated

Dave Towne — Fri, 11 Sep 2020 12:30:50 +0000

On September 2, 2020, FNMA updated their policy allowing for Accessory Dwelling Units (ADU) on Single Family Residential (SFR) properties to be a Manufactured Home. This is in their Selling Guide Announcement SEL-2020-05, linked below. Key points: An accessory dwelling unit (ADU) is an additional living area that is independent of the primary property and has basic bathroom, cooking, and sleeping facilities. With this update, we clarified ADU property eligibility and comparable sales requirements in the appraisal as follows: expanded the current definition of an ADU to improve proper classification of ADUs; expanded property eligibility by allowing multi-width manufactured homes...

Missing HUD Tag # on Manufactured Homes Sometimes NO HUD Tag number can be found... Appraisers, Regarding Manufactured Homes (MFH), sometimes NO HUD Tag number can be…
AMCs Appraisal Report Reviews AMCs are legally required to do appraisal report reviews... Appraisers, an appraiser shared AMC appraisal report review documents with me,…
Fannie Mae Filed a Complaint Against Me An appraiser shared the following with us which was posted on one of the appraisers’ groups. Fannie Mae filed a…

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Data and Verification Sources Are Critical

Dave Towne — Fri, 15 Nov 2019 13:30:13 +0000

The genesis for this essay began when I heard from another appraiser that a VA report reviewer rejected the comparables “DOC Number” on the Verification Source(s) line. The reviewer said the “DOC Number” was not acceptable as a Verification Source. In fact, VA has said in a newsletter to appraisers that “… Assessor’s File Number may never be used as a Verification Source.” I disagree with that position, and this essay explains why. It also explains what appraisers should do to provide credible Data and Verification Source(s) in reports. Caveat: I don’t do VA assignments. I decided that a deeper dive...

The New & Improved Fannie Mae “FRAUDULATOR 2.0” Originally known as Fannie Mae’s Collateral Underwriter (CU), and subsequently Collateral Underwriter 2.0 (CU-2)i this always dubious product of Fannie…
Bias and Discrimination in Reports, Yes or No? Appraisers, should we include discussion of B&D in our reports? Wait, What?? Bondage and Discipline? No, not that. Bias and Discrimination.…
The Town With No Bank: How Rural America Lost Its… For decades, we’ve been told that the problem is demand. That people don’t want to live in rural America anymore.…

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Street Scene Photos of the Subject Property

Dave Towne — Tue, 05 Mar 2019 13:30:23 +0000

Appraisers, the discussion of subject photos occurred recently on a forum I read. How many of you know the street scene “view” policy of FHA and FNMA? How many of you were trained to just take ONE photo from the very front of the subject, looking down the street in one direction or the other (without having the subject in the photo)? Is that ‘good enough’ for a lender to know the context of where the subject is on the street? If a ‘street view policy’ between agencies is more strict for one, would it be appropriate to adopt that policy for...

USPAP’s Typical Buyer Standard in the Fair Housing Era The Irreconcilable Conflict Between USPAP's Typical Buyer Standard and the Current Fair Housing Compliance Regime. Retain this document as a…
The Great Debate on Appraisal Fees She included several different fee split examples indicating AMCs retained as much as 70 percent of the total appraisal fee…
It’s Time to Take Out the Junk: AMC Practices Exposed Appraisers have spent years carrying the weight of broken AMC practices, and this article pulls every one of those practices…

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COD at The Door?

Dustin Harris — Tue, 19 Feb 2019 13:30:24 +0000

Can Appraisers Collect at the Door (COD)? In the past, it was common for appraisers to collect their fees directly from the borrower at the time of the property visit (i.e., at the door). I would take credit cards, checks, or cash while at the door. Many years ago, this was common. Now, however, that rarely happens and we usually have to wait 30- to 60-days for payment from the AMC client. So recently, when I got a COD order from HUD, I was really surprised. In fact, I thought something was bogus. I needed to check this out since...

It’s Time to Take Out the Junk: AMC Practices Exposed Appraisers have spent years carrying the weight of broken AMC practices, and this article pulls every one of those practices…
Uncovering Flaws in FHA Appraisal & Loan Review Process The story of this single mother's harrowing experience with a defective home purchase and HUD's negligent oversight exposes deep flaws…
How to Destroy the Appraisal Profession Anytime the government gets involved in an issue, it tends to have more adverse effects than positive ones. It makes…

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Bye-bye 1004MC, Hello Analysis

Rachel Massey, SRA — Fri, 17 Aug 2018 12:30:34 +0000

On July 31, 2018, at the Appraisal Institute Annual Conference, Fannie Mae announced the end of the 1004MC. News quickly spread among the appraisal blogosphere, and on August 7, 2018, the new Selling Guide showed that the 1004MC was no longer required. Rejoicing was heard throughout the land. Although the 1004MC is no longer required by Fannie Mae, the appraiser still needs to support their opinion of market trends, supply and demand, and marketing time. The exact verbiage found in the 8/7/18 updated Selling Guide is: The appraiser’s analysis of a property must take into consideration all factors that affect...

Commercial Appraisal Reports: How Much Do They Cost? Every business that owns a commercial property will require an appraisal. Commercial real estate transactions are the most common. Commercial…
The New & Improved Fannie Mae “FRAUDULATOR 2.0” Originally known as Fannie Mae’s Collateral Underwriter (CU), and subsequently Collateral Underwriter 2.0 (CU-2)i this always dubious product of Fannie…
Dear Representative, FNMA Has Gone Rogue! Dear representative, waiving/eliminating property appraisal for lending purposes is wanton recklessness. Fannie Mae’s decision to waive/eliminate property appraisal for lending…

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Waiving Appraisals & Lowering Appraisal Standards

Dave Towne — Wed, 13 Jun 2018 12:30:51 +0000

Freddie getting aggressive in waiving appraisals & promoting appraisal free mortgages… Appraisers, Yes, I have a ‘dog in the fight’ with this article, as I have been an Appraisal Institute member since 2003 (along with other association memberships since). But this article provides explanations about changes to the appraisal process I have not seen elsewhere. Excerpt from “Dodd-Frank rollback weakens appraisal standards“ They started to evaluate whether they wanted to raise that appraisal threshold level from $250,000 to some figure… They left it untouched at $250,000 for residential, but they have increased the commercial real estate appraisal threshold level just in the...

Fix It Before Replacing It! Fix what is broken before replacing the product. Appraisers are talented professionals that know how to take mass amounts of…
Appraisal Thresholds Bordello Anyone wants to place a wager on how long before appraisal thresholds are raised for SFR? Retirement, with a part-time…
Appraisal Simulator The industry is working of an appraisal simulator... The US House of Representatives Passed S 2155 today! Section 103 allows…

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Concession Reporting Confusion

Dave Towne — Thu, 12 Apr 2018 12:30:22 +0000

…how are these "lender contributions" identified… Appraisers are ‘required’ to report comparable sales or financing concessions that benefit a borrower in the GSE form appraisal report, on the second line in the comparison grid (as a negative adjustment). Secondly, for subject properties, appraisers are ‘required’ to report any concession benefiting the borrower on page 1 of the report form. Subject concession amount is NOT entered on the Comparable grid. Well now, FNMA has issued a modification to their Selling Guide (which takes effect as of 4/03/18) – SEL–2018-03 – (I have added type face enhancements): Lender Contributions With this update we are...

Concession Adjustments Missing Concession Adjustments are expected to be made... Appraisers, As noted previously, I ‘observe’ various reports from various sources. A new…
Rumor - GSE Forms Revisions Coming? GSE’s “really want your input” on the proposed revisions... Folks, Rumor has it that the GSE’s are ‘finally’ considering making…
Quit Overreporting! Why Do Appraisers Keep Overreporting...? Appraisers, Another friend has provided a copy of an appraisal on the friend’s home. Good…

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AMC 1004D Update Shenanigans

Dave Towne — Fri, 05 Jan 2018 13:30:19 +0000

Why wasn’t the original appraiser asked to do the 1004D Update? Here it is the new year, and the potential games played by some AMC’s have already started. On January 3, 2018, I received word from an appraiser that this “substitute” appraiser was asked by an AMC to do a 1004D Update on a report another appraiser had done in September 2017. The AMC provided the original appraisal with the assignment request. I see mentions of this kind of assignment on various forums I read, and the posters always question these requests. On the surface, it was not a highly...

Uncovering Flaws in FHA Appraisal & Loan Review Process The story of this single mother's harrowing experience with a defective home purchase and HUD's negligent oversight exposes deep flaws…
ANSI & Floor Plans Goofiness "...if you the appraiser are not required to inspect the property yourself, don’t you want to have a more detailed…
It’s Time to Take Out the Junk: AMC Practices Exposed Appraisers have spent years carrying the weight of broken AMC practices, and this article pulls every one of those practices…

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Suburban Inside Urban City Limits – Really?

Dave Towne — Tue, 26 Dec 2017 13:30:23 +0000

Pre-filled template with ‘Suburban’ already checked… Appraisers, Another appraisal report was delivered by a homing pigeon to my windowsill the other day. After leaving a ‘deposit’ on the sill that kind of matches the goop I observed in the report, off it went. The subject property is within a built-up neighborhood area within the largest city in this particular area; it is within city limits. The neighborhood was developed in the 1950’s and 60’s. It is fully built out (i.e., all subdivided lots are developed) and has a couple of neighborhood parks. Population density is similar to other areas within...

Fannie Mae Filed a Complaint Against Me An appraiser shared the following with us which was posted on one of the appraisers’ groups. Fannie Mae filed a…
Promoting False "Racist Appraiser" Narrative Some Lenders promoting false "racist appraiser" narrative to optimize profits via AVMs Like most businesses lenders want to optimize their…
Security Bars Removal Law Debunks Alleged Racial… Complainant stated appraiser told them they should remove security bars from windows. Complainant stated this is evidence of "racist discrimination"...…

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Can You Use the Subject as a Comp?

Dustin Harris — Wed, 23 Aug 2017 12:30:01 +0000

To keep my finger on the pulse of the real estate appraisal community, I like to check in on Facebook groups dedicated to our profession. A little while ago, I noticed that the same question was coming up over and over again; ‘can you use the subject as a comparable sale?’ When you work in a big, metropolitan area, this isn’t really an issue. Real estate appraisers in those places would probably dismiss this idea out of hand; they’re going to have plenty of comparables to use in their valuation process. In rural areas like the one in which I...

Seeing the Forest Through the Trees Focusing on individual adjustments to the detriment of the bigger picture... Growing up, my parents used to refer to my…
Possible vs. Probable Refusing to ‘rubber-stamp’ a purchase price with an appraised value to match. Recently, there was a news story out of…
Is There a Fourth Approach to Real Estate Value? I want to talk to you about the fourth approach to value... ...and specifically an occasion on which it truly…

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selling guide - Appraisers Blogs

Fannie Mae Filed a Complaint Against Me

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Dear Representative, FNMA Has Gone Rogue!

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