Valligent New $40 Alternative Valuation Assignment
- “Valuable” Advice From an AMC - February 6, 2023
- Tenant in Distress… What Would You Do? - February 2, 2023
- Appraiser Countersuing Black Homeowners for Defamation - January 30, 2023
Valligent, an AMC with ‘national’ presence, is soliciting appraisers to complete a new alternative valuation product on behalf of their GSE clients.
There is nothing wrong with doing these. Any appraiser can. But any appraiser who does these assignments is required to comply with USPAP’s Record Keeping Rule. Which means keeping a Workfile for every assignment.
In order to do these alternative valuation assignments, you need to comply with USPAP Standard 3, because you ARE providing a report review service. Even though Valligent is sly about not really revealing that aspect.
The SOW for these assignments, which I highlighted below, is actually absurd. Because, in order to evaluate the comparable sales, the appraiser will have to review the Subject Section in the report. You cannot make a decision as to the applicability of the comps in comparison to the Subject , unless you determine the subject’s characteristics first.
Here’s the relevant portion of the Valligent message, with my additional comments below:
The basis for this assignment is portfolio analysis leveraging the expertise of our panel to conduct a simple yet important analysis of only a portion of a prior appraisal report. You would be asked to limit the scope of your review to the comparable selection and the question of whether the comparables used were the best/most appropriate as of the effective date. No inspection is required, and no analysis of any other sections of the report are needed.
Client qualification requirements dictate that you must have prior experience appraising within the subject property’s specific zip code. As the results will be relied upon by the GSE, it is imperative that your knowledge of the immediate area be extremely thorough, and that the utmost care be given to your results.
Due to the limited scope of the assignment, a fee of $40 will be paid for each assignment. You will have approximately 2-3 business days to perform your analysis and finalize the report using the Acuity and Harmony platforms. It is estimated that each assignment will take approximately 20-45 minutes to complete, once you familiarize yourself with the requirements.
This is the key element of their Scope of Work:
“…asked to limit the scope of your review to the comparable selection and the question of whether the comparables used were the best/most appropriate as of the effective date.”
The other aspect of this kind of work for Valligent is in their appraiser engagement contract. Buried within, is the subject of Background Checks. Per their contract, they will deduct a minimum of $5.00 per assignment. However, it could be more depending of variable costs determined by your location in the US. So your net income may be something less than the $40 per assignment.
Bottom line: can you do these kinds of assignments? Yes. Will you want to do these? Who knows! It’s a business decision on the part of independent appraisers.
Remember, you ARE providing a valuation service (i.e., an appraisal) when you opine whether or not the ‘comps were the best.’
The Valligent message does not reveal the process if you decide the comps ‘are not the best.’ If you are expected to provide better ones, then you will be doing a full Standard 1 & 2 appraisals. And $40 is an absurd fee.
The GSEs are just trying to get a very limited report review done on the cheap by someone with a license and E&O insurance.