WASHINGTON, D.C. – The nation’s four largest organizations of professional real estate appraisers—the Appraisal Institute, American Society of Appraisers, American Society of Farm Managers and Rural Appraisers, and National Association of Independent Fee Appraisers—delivered the second of two letters to Treasury Secretary Timothy Geithner urging the Administration to protect homeowners and taxpayers by requiring that the market values of homes under President’s Obama’s Homeowners Stability Program be determined by professional appraisers who are state certified and licensed.
Current bank agencies guidelines require new appraisals in restructuring loans when a material change in market conditions exists. In the letter, the groups affirm that reliable valuation and appraisal products are available from professional appraisers in every community in the country. There are more than 100,000 certified or licensed real estate appraisers in the United States. Because of new technologies and methodologies, these professionals are prepared to deliver a wide variety of necessary services quickly, including summary and streamlined appraisals that are cost effective and highly reliable.
To ensure that all parties have accurate and reliable information when restructuring loans, the letter cautions against the use of real estate sales people to provide broker price opinions. These individuals have no valuation training, do not observe uniform valuation standards, are accountable to no one for their estimates of home prices and may sometimes have an economic interest in whether loans are modified or defaults occur requiring a resale of the property to another buyer. By contrast, all 50 states license, certify and supervise the work of appraisers; and 23 states specifically prohibit realtors from valuing properties for any mortgage related purpose, including loan modifications.