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AppraisalPort has posted a new Weekly Poll as a follow-up to last week's. THIS week, appraisers are asked to respond with how much Net Income they made (income after expenses & taxes).
Visit http://www.AppraisalPort.com to vote in the poll and be SURE to read and add YOUR comments below!
The graph below shows last week's AppraisalPort "Gross Income" survey results (with 5,000 votes cast) from last week. Check-out how the results compare!
This just in from the Appraisal Institute:
"Four states – Illinois, Maryland, Missouri and Nevada – are considering legislation that would prohibit or restrict the use of “distressed sales,” such as foreclosures and short sales, as comparable sales as a part of a residential real estate appraisal.
Home builders and real estate sales agents are concerned that the prevalence of distressed sales, and their subsequent use as comparables, is resulting in the appraised value of residential properties not matching the contract sales price, or in the case of new construction, the cost to build." The issue is, can you legislate this in the trenches? Maybe just maybe. Read more . . .
The Appraisal Institute article says:
If these bills were enacted into law, appraisers would be put in the difficult position of having to choose which law to violate. Appraisers are required to adhere to comply with the Uniform Standards of Professional Appraisal Practice in federally related transactions. The standard mandates that appraisers “must analyze such comparables sales as are available.” Further, the standard cannot be voided by a state or local government.
Source: Builder On-Line
HousingWire author Jacob Gaffney interviews David Feldman, vice president, government affairs at CoreLogic Valuations. Feldman sat down with HousingWire to talk about the impending deadline on appraiser fees under new regulation.
Click here to read find the ANSWERS to these questions !
AppraisalPort has posted their Weekly Poll and it's generating a LOT of interest. Having watched the poll for the past couple of days the percentages haven't really changed much, whether there were 500 votes or 3,000!
Visit http://www.AppraisalPort.com to vote in the poll and be SURE to read and add YOUR comments below!
There's a WinTOTAL Users Group discussion that I thought the larger Appraisal Scoop audience might benefit from:
"Hi Everyone, I received an appraisal request from an AMC yesterday and the fee they were offering was low, especially for this particular property. To accept the order I was asked to check a box which stated that their low fee was "reasonable and customary." I declined the order on the basis that the fee was not reasonable and customary."
"The sad part is, I know there is some desperate appraiser out there that not only took assignment at the low fee but sold out the rest of us by signing a document saying that they agreed it was reasonable and customary. The race to the bottom continues!"
Juan Restrepo Ocotillo Appraisals responded:
COAA (Coalition of Arizona Appraisers) http://www.azcoaa.us/ is gathering information regarding this type of orders. This group had a news alert done by Dave Stone, this is the link (click here).
We are trying to make our legislators aware of what is going on. If you could please forward the order to me Juan Restrepo [ jfr@cox.net ], or directly to Dave Stone, it would help us document what is currently going on. If anyone else encounters this type of order, we would like to know as well.
Thank you,
Juan Restrepo, Ocotillo Appraisals
Following the recent Appraisal Scoop post from Pipeline Press titled Are YOU an "Ineligible Receiver"? CitiMortgage Monitors "Ineligible Appraisers" List I received the following email and have reprinted it below, with the Appraiser's permission.
I thought his story was somewhat unique in that it was the first time that I'd heard of an appraiser being blacklisted for completing a market update of another appraiser's appraisal. Take a look at this story and please share your thoughts!
"I am a certified residential appraiser and have been appraising for the last 12 years successfully. A year ago I received a letter from CitiMortgage saying I was being blacklisted by them for a market update (1004 D) I was asked to do for them by PCV Murcor although the appraisal was done by another appraiser.
I [completed] the 1004D as requested and found the market conditions still stable. CitiMortgage apparently had a problem with the underlying appraisal done by another appraiser and is blaming me, as the address of the property [format] in his appraisal is the same as in the letter they sent me.
I wrote a letter to Gary Schlittler, their VP in charge of appraisals, and he said they were modifying the "punishment" by putting my name on the monitor section of the list (requires a field review) with any appraisal submitted to them by me. This has hurt my business not only from the lack of CitiMortgage business but they have also shared the information with other AMC's who will not place orders to me for their clients as their clients may be taking the loans to Citi.
I searched your site for a half hour, but I couldn't locate any information or instructions on how to actually fight this arrogant practice. I had requested they send me the actual file on what was reviewed when they made their decision to blacklist me, but they are ignoring me. Do you have any articles or material that gives instructions or strategies on how to get your name removed from a blacklist? Thank you for any information you can provide."
There has been a comment from the "Ineligible Receiver" post regarding a source for a potential class action lawsuit:
Here is a law firm taking on with Wells Fargo
When emailing, please reference “Wells Fargo/RELS Blacklisted Appraiser”
•Contact: Genessa Stout, Attorney at Law: genessa@hbsslaw.com
•Larry Kunzler, Investigator: larry@hbsslaw.com
Also . . . for those that are interested in reading MORE about Black Listing, please click the Appraisal Scoop category [Blacklisting / Exclusion Lists] in our navigation on the left.
The National Association of Home Builders has produced, ""Imported Problematic Drywall: Identification Strategies and Remediation Guidelines," a new resource for its builder and remodeler members. According to a press announcement, "The publication represents more than a year of intensive research, testing, analysis and evaluation under the auspices of NAHB's Chinese Drywall Task Force, whose mission was to identify a permanent solution to problems with drywall emitting or off-gassing corrosive compounds, which can lead to blackening of copper electrical wiring and air conditioning evaporator coils and can cause mechanical, electrical and electronic failures."
March 16, 2011 - A new resource for builders and remodelers looking for answers on the critical question of how to detect and remediate problematic drywall imported from China in recent years is now available from the National Association of Home Builders (NAHB).
"Imported Problematic Drywall: Identification Strategies and Remediation Guidelines" can be downloaded at www.nahb.org/drywallguidelines.
The publication represents more than a year of intensive research, testing, analysis and evaluation under the auspices of NAHB's Chinese Drywall Task Force, whose mission was to identify a permanent solution to problems with drywall emitting or off-gassing corrosive compounds, which can lead to blackening of copper electrical wiring and air conditioning evaporator coils and can cause mechanical, electrical and electronic failures.
"The downstream effects of these problems include widespread property damage, huge financial losses, hundreds of lawsuits, and legitimate concerns about possible health effects from living with these unpleasant airborne compounds," said NAHB First Vice Chairman Barry Rutenberg, who moderated a webinar to introduce the guidelines to NAHB members.
"In a landscape cluttered with untested products, devices and procedures purported to resolve drywall problems, NAHB based these guidelines on scientifically proven technologies, materials, means and methods for remediating drywall problems in single-family homes, condominiums, apartments and townhomes," Rutenberg said.
Designed to address problematic drywall in residential applications, the document does not represent the only approach to remediating the problem. It is not intended to set minimum or maximum requirements for remediation nor is it intended to be used to determine the effectiveness of remediation efforts that have already been completed. Builders might decide to follow different guidelines that are less inclusive or that include additional measures.
Among some of the document's recommendations:
To verify is to establish the truth, accuracy, or reality of something. Verified information is fact.
Guest Post: The author, Edd Gillespie, is a Certified General Appraiser from Pueblo, CO that specializes in litigation support, 1031 exchanges, estate appraisals, and commercial mortgage work.
The 2010-2011 Uniform Standard of Professional Appraisal Practice [USPAP] Standards Rule SR 1-4 says the real property appraiser must verify all information necessary for a credible result.
SR 1-4 encapsulates a substantial portion of the USPAP scope of work requirements for real property appraisal and implies techniques about which volumes are written. The rule is loaded with terminology that an appraiser must understand in order know whether he or she is complying with USPAP, but for now I am focused on to verify.
What is verification? Verification is an activity an appraiser must undertake in development of the appraisal and it means that the information the appraiser uses in analysis is fact.
For example consider the address of the subject property. An address is commonly used in identifying the subject property and is therefore information necessary to a credible result. Usually the client tells the appraiser what the address is. At that point the address is collected information. Now the appraiser must verify the information. It must be confirmed. It must be checked out. The pervasive theme in USPAP is that the appraisal NOT BE MISLEADING. [Reference FAQ 243. Property Address]
Does that theme have a bearing on how the appraiser goes about verification? If the appraiser were confirm the address by calling the client back and asking is there a chance for error? Would it be better to check out the address with a reliable independent source such as the public record? The way an appraiser chooses to go about verifying information can build assurance that the appraisal is NOT MISLEADING.
Another example:
Appraisers often maintain that the information they use is error free. Does SR 1-4 permit the appraiser to use information without verification?
WHAT DO YOU THINK?
The author, Edd Gillespie, is a Certified General Appraiser from Pueblo, CO that specializes in litigation support, 1031 exchanges, estate appraisals, and commercial mortgage work. Contact Info: 590 N. Matt Dr. Pueblo,CO 81007 Phone 719-252-7624 E-mail eddgillespie@yahoo.com
Harvey S. Jacobs, real estate lawyer in the Rockville office of Joseph, Greenwald & Laake, wrote the following in his Washington Post article - A common-sense way to mend the draconian appraisal process .
"If federal regulators are truly concerned about the quality and independence of home appraisals - a cornerstone of sound mortgage lending - why don't they simply prohibit appraisers from learning the contract price before they perform their assessment of a home's value?
Instead of this commonsense solution, regulators continue to come up with schemes that govern how appraisers are chosen - and which simultaneously drive up prices to consumers while cutting the income of appraisers.
On April 1, a new regulatory scheme called Appraiser Independence Requirements, will go into effect. This AIR replaces the much-maligned Home Valuation Code of Conduct but does little to improve it. Both AIR and HVCC were designed to ensure that the home valuation process conducted by appraisers is conducted in a strictly independent manner. Unfortunately, in practice AIR continues the legacy of HVCC, causing borrowers to pay more for their appraisals and appraisers to earn less for their work."
While the article does a very good job of chronicling the history of the HVCC, AMCs, and the AIR, I'm not so sure that his answer to the problem will solve all of the problems that he thinks it will.
For one thing, it assumes that all mortgage appraisals done for lenders result from sales. What about the gazillions of refinance appraisals for which there are no "contract prices"?
Without access to the contract, how would the appraiser be able to learn ALL of the terms, conditions, and concessions involved with the sale? Doesn't USPAP require appraisers to view and analyze the current contract?
Does the author REALLY think that the contract is the only place that appraisers would learn the sales price? Even IF the sales price were to be redacted from a contract, don't you think that the buyer, seller, agent or someone involved in the transaction would let that figure "slip"? Wouldn't it be BETTER to have something that actually documents the factual sales price?
What do YOU think of this author's fix to the "draconian appraisal process"?
Washington Post reporters Zachary A. Goldfarb and Dina ElBoghdady are working this morning on word that a compromise deal is near that would resolve accusations of fraud and chicanery in banks' handling of failed home mortgages and property repossessions.
Goldfarb and ElBoghdady report that while a number of disparate agencies have banded together in agreement, the Office for the Comptroller of the Currency--which oversees the banks--remains opposed to the direction of the deal. What's more, there's work to do on the final terms of the settlement.
They write, "Even as officials neared consensus over the changes they would require banks to make in foreclosure practices, there was still no decision about how large a penalty banks should face and whether they should pay a fine or devote the sum to helping rework mortgages for distressed borrowers. Officials have told banks they would like the industry to help avert 1.5 million new foreclosures, sources said." It's important this gets settled for the market to work on normalizing supply and demand.
Source: Washington Post & Builder Online
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