The New Appraisal Profession – Why bother!

Douglas Kues says:

If I could agree with you more, I would, but cannot. Right on target with this post, and now that you are retired wouldn’t it be sweet to find a few of us that share the sentiment and provide a fairly reasonable solution that would put things back into some sort of equally reasonable perspective. We still remain about the only industry that I am aware of where the customer writes the rules. When we appraisers go to a mechanic, and inspector, or a physician, we must agree and adhere to THEIR guidelines. So how is it that when the AMC or lender come to us WE must adhere to THEIR guidelines as well? Why and how is it that appraisers never put their heads together long enough to recognize that as bass-ackwards? It is so very logical that it should be the appraiser that makes the guidelines and requirements. We all must comply with industry standards anyway, so that goes unsaid, but how is it that WE are not setting our acceptable guidelines for things like turn times, fees, trip fees, review procedures, charges for participation in the review process when the reviewer being paid to do so never even reads the report prior to automated rejections, invasive photo requirements, scope creep that puts us in the arena of a licensed contractor (proper double strapping, proper CO alarm installations, adequacy of HVAC sources, etc, etc), and all those sorts of client demands that have nothing to do with value or marketability or that blatantly contradict industry standards? How does an appraiser CYA when the standards themselves contradict each other? There is no clear answer as to how an appraiser can be mandated to make an adjustment for an obvious difference between subject and comparable, when in the very next sentence is prohibited for making an adjustment without a verifiable market reaction? This alone creates a situation whereby, say, a subject has an obviously custom or valuable unique feature that cannot be duplicated within the best available or even expanded search comparable sales….. that the appraiser is required to, and precluded from, making an adjustment for a feature without verifiable market reaction. All these, and dozens more, issues could be easily circumvented with a simple Vendor Agreement applied to all potential clients BEFORE the assignment order is placed and accepted rather than blindly accepting what the client proposes. Just sayin I think I have a retirement plan.

jaydee says:

I’m part of that mill. I don’t know how many “deals I broke”. My signature is sacred on any document. I’ve been overhauled by the state board a number of times. No violations, no administrative anythings. But with all the stuff rolling down hill and the major reason: a tumor in my head. I retired.

IMJSAYN says:

Bingo!

Baggins says:

Those are subjective points though. If the agents have performed their job in an acceptable ethical manner, the task is rather easy for the appraiser, and it is fair and appropriate to the market and data, to ‘hit the number’. Where as if agents are back patting, wrangling and steering customers into overpriced deals, then the appraiser has to put more work in and ‘kills the deal’. So it’s always the dang most aggressive agents whom deal with appraisers not allowing their deals to work. Because we refuse to sign off on their inflated figures which don’t comp in the market. I’ve been reading a lot of bpo’s over the past few years. It’s a miracle with some of these lackluster methods that agents even come close to market value figures. Just think about it, come about a number, apply one lump sum adjust in condition to back into that number, call it a day. Bpo’s are a totally inadequate substitute for a real appraisal, even a desktop.

That’s why I still to this day comp search everything and simply decline orders if I can’t see an avenue to success. If more appraisers did that, more lenders would become responsive and actually pass the comp feedback to agents, as most of us when we decline for these reasons clearly state this is not going to work and does not comp out. Send the agents back for a new analysis, restructured deal, add an appraisal gap, come down on the price, whatever is necessary but one way or another, I’m not getting involved in deals like that. Before amc’s came around and brokers actually dealt with appraisers directly that way, fewer consumers got wrangled in because the appraiser and the mortgage person could work together to share that sort of information. Where as an amc just shops until they find an appraiser willing to make it work.

The topic of appraisers hitting the number is often confused and conjoined with applied pressure, but depending on appraisers approach in the pre acceptance sow forming phase of assignment, that’s not always the case. You know, I almost always hit that number, believe it because it’s true. On the other side of the coin, I’ve passed over a lot of work when agents line up deals that are out of range. I leave that headache for the next guy in line. If I can make a deal work in a defensible manner, I will. If I can’t, I walk away. The toughest ones are concealed issues and hidden defaults not showcased in the listings. Sometimes there is no way out and now and then agents will simply need to be clearly and politely informed why there was disagreement. Things like non qualified space, foundation structural issues, or the worst ones is when they had believed a home was larger than it really was. That’s what makes ansi so problematic, their approach that what should be qualified space according to local market standards, is not qualified space due to inflexible rather arbitrary qualifiable space ansi rule setting.