Appraisal Scoop

CoreLogic® Introduces New Platform That Integrates MLS and Public Record Data for Appraisers

PR: November 09, 2011, Santa Ana, Calif. -

-AppraiserSuite Will Help Appraisers Find "Fresher" More Relevant Comps-

CoreLogic (NYSE: CLGX), a leading provider of information, analytics and business services, today announced the release of AppraiserSuite, a platform that combines multiple listing service (MLS) and public record data in a single online workspace for appraisers, review appraisers, underwriters and quality control personnel. The new subscription-based platform enables appraisers to quickly research and compile property and market information from multiple sources. AppraiserSuite also streamlines the comparable selection process and offers the ability to export data into standard appraisal reports through form population tools.

Download a Sample Report - Click Here

AppraiserSuite provides direct access to the MLS data in many of the top U.S. markets gathered through the CoreLogic Partner InfoNet™ program in which more than 66 MLSs participate. By incorporating MLS and public record data into a single workspace, AppraiserSuite provides details on the subject property, comparable properties, historical transaction information, tax data, and other property and market area characteristics. AppraiserSuite is also able to highlight inconsistencies between the two data sources, and offer the opportunity for Appraisers to contribute their own information that may help reconcile these differences.

AppraiserSuite includes leading mapping technology that provides a view of neighborhood factors that impact a property's value like parks and active railroad lines. AppraiserSuite also allows appraisers using ACI2010™ to import their property and comparable research data directly into industry standard appraisal report forms such as a Uniform Residential Appraisal Report (Form 1004) without manually rekeying the information.

Ben Graboske, CEO of CoreLogic MarketLinx, said, "Real estate professionals contribute local market insights directly into their MLS systems. AppraiserSuite makes it easier for appraisers to gather the information they need when determining the value of a property. By incorporating MLS information into AppraiserSuite, we are providing appraisers with a broader view of the market and with the tools to make the entire appraisal process more efficient."

In addition to helping appraisers generate reports for real estate financing purposes, AppraiserSuite can generate an alternative valuation report such as a desktop appraisal, APO or an addendum to other standard appraisal forms. The report follows USPAP compliance standards and is available as a PDF or a MISMO XML Output.

AppraiserSuite is also available for Appraisal Management Companies (AMCs) and can be integrated into an AMC's current order management system, creating a seamless user experience for appraisers and quality review teams.

CoreLogic has been featuring AppraiserSuite during the Valuation Expo in Las Vegas, Nev. on November 7-9, 2011. New AppraiserSuite users will be offered a $150 discount on a one-year subscription if they sign up by November 30, 2011.

FannieMae Communication: Important UAD Appraisal Instructions

This communication was sent to Direct FannieMae Vendors (REO Appraisal Vendors) and covers a number of important instructions required for properly submitting REO appraisals. Please read it carefully and retain it for your reference.

DOM / CDOM / Subdivision Name

The new UAD format does not provide fields for Days On Market and Cumulative Days On Market (DOM/CDOM) nor the name of the Subdivision, which we request for comparables.

Effective immediately, enter DOM/CDOM and Subdivision Name on two of the blank rows near the bottom of the comp grid:

Days On Market is the number of days since the last price change. Cumulative Days On Market is the number of days since the property was listed. When entering this information, use whole numbers separated by a slash, using no spaces. (As if you were typing a fraction.)

Examples:

30/100 = OK vs. 30-100 = Rejected (did not use slash)

30/180 = OK vs. 30 / 180 = Rejected (inserted spaces)

On the next line, write "Subdivision Name" and enter the name of the subdivision, if applicable.

Effective Age (Yrs) and Actual Age UAD instructs that if the age of the property is not known, then you are to estimate the age and use the tilde character (~), typically located left of the number 1 key, to show the date is approximate. This may cause a "Draft Not Acceptable" error within AppraisalPort. Please alert us via AppraisalPort if this error occurs, and we will accept the case.

For both Effective Age (Yrs) and Actual Age, enter a whole number (no decimal places) representing number of years.

Examples:

20 = OK vs. 19.5 = Rejected

~20 = OK vs. Approx 20 = Rejected

Remodeling and Renovations

Only include remodeling and renovation costs when there is extensive damage that will require many repairs where making these improvements in the process makes sense. Otherwise, Do NOT include these costs in your repair estimates which should include repairs needed to bring the property up to a typical condition for the neighborhood.

Additional Photos

Positive and negative external influences around the property may impact the estimate of value. To ensure all external influences are accurately documented, our new order letter will now require the following additional pictures:

• Picture of what is behind the subject and directly across the street
• A street scene view both directions and for a corner lot all 4 directions
• Aerial view of the subject and the surrounding structures for a few streets either direction

Any external influences and any positive or negative impact on value should be addressed in the appraisal.

UAD Photos

Include enough pictures to support the subject property condition rating with a special focus on bathrooms, kitchen and other improvements.

New Order Letter

We will soon be implementing a new Order Letter. The new letter is more streamlined, and intended to provide you with the key points and tips to complete your assignment according to Fannie Mae process and format.

Source: FannieMae

You Can Write an Appraisal on a Napkin..... But you probably just didn't

Guest Author:  Ken Shure, Certified Residential Appraiser in the Los Angeles, California area.  Contact: kbshure@Yahoo.com

We've all heard the phrase - "You can write an appraisal on a napkin if you want to". And yes, USPAP does give a wide berth in terms of reporting format but it is important to recognize that other than expanding upon the scope of work in order to accommodate the appraisal process, this does not provide appraisers with the authority to deviate from an agreed upon and expected scope of work or violate the sometimes extended list of certifications that are present on many of the pre-printed appraisal forms.

The most common reporting formats for appraisals are found within the lending arena and those typically used are the forms issued by Fannie Mae. These forms have a designated intended use, a specific minimum scope of work, a set of assumptions and limiting conditions, and certifications. If the appraisal process or specific client mandated assignment conditions cannot be properly completed when following and staying true to those items then it is much better to request a different reporting format, perhaps a napkin would be one alternative, or decline to proceed with the assignment. Proceeding within the framework of the forms despite it being contrary to producing a credible report or misusing the form in a manner that could be construed as misleading could have negative consequences for the appraiser and the appraiser's client.

Appraisers need to remember that Fannie Mae and other agencies delegate the responsibility of appraisal credibility and compliance to lenders. They rely on this delegation and receive documents signed by state licensed professionals that outline a minimum scope of work and have a set of certifications. Based on this it is clear that the agencies conceivably do not have to review every aspect of the appraisal reports they receive but can limit their review to key parts that indicate the appropriateness of the collateral for the loan being applied for. The basis for making this determination could depend on any number of factors including but not limited to the opinion of market value, conformity of the subject to the neighborhood, and zoning compliance to name a few examples.

One notable and critical area of the report that would always be necessary for any user to review would be the reconciliation section of the forms where it is clearly indicated via checkbox if the appraisal is made "as is" or if it relies either on an extraordinary assumption or hypothetical condition in order to reach its conclusions. A report that indicated "as is" within this section but did in fact rely on an extraordinary assumption or hypothetical condition, even when these are written out somewhere in the body of the report, could be viewed as misleading. Appraisers that indicate otherwise within the reconciliation section but still rely on extraordinary assumptions or hypothetical conditions outlined elsewhere in the report are in danger of being accused of trying to "slip one by" the agencies and the agencies would be well within their right to claim damages in the event of a loss.

The zoning compliance box is also a very important factor that should be taken seriously by anyone that completes one of these forms. In many jurisdictions with complex zoning codes it is arguably beyond the skill level and scope of work of the appraiser to absolutely ensure that all aspects of the property are in compliance with zoning however a certain level of due diligence would absolutely be expected. Properties that have significant and readily observable discrepancies from available public records should give cause for pause to an appraiser assigned the responsibility of checking that box. An appraiser that checked "legal" with regard to a property that in fact had substantial and readily observable elements that were built without permits or had an illegally converted garage, in violation of many zoning ordinances, could be held to task if the agencies were relying on the report to determine the zoning compliance status of the property. Adding in a cost to cure or an extraordinary assumption can easily be viewed as a misleading tactic in these cases where both the "legal" and "as is" boxes are checked.

Appraisers hold the ultimate responsibility towards determining the appropriate scope of work needed for producing a credible result. Despite this, appraisers are not free to pick and choose which portions of the lending forms they will abide by when this is the format that has been agreed upon. If these forms are modified by agreement with the client then it is best to avoid any chance of confusion and remove all reference to the publisher of the form and the form number. Should an altered form used to complete a report end up being utilized by the agencies (whether by accident or by design), the mere presence of the form number on the report gives ample cause for the final user to claim certain expectations with regard to the minimum scope of work and other items typically associated with the completion of, for example, a 1004.

Making use of the lending forms is a common and often necessary practice. It is important for appraisers that utilize these forms to be aware of the minimum scope of work they have agreed to follow and the certifications that they are signing. In addition it is important to be aware of the mechanisms within the forms designed to ensure that the agencies are making appropriate funding decisions and to make sure that these mechanisms are not bypassed, contradicted, or ignored. Inappropriate actions in this regard could result in large consequences being directed where the agencies have been sure to delegate appraisal related responsibility - on the lenders. In these cases there is little doubt as to whom the lenders would turn towards to direct their concern over the issue at hand and little doubt that it would not matter if the directive to complete the assignment in the manner in question came from the lender itself or its hired agent (AMC). While those parties would certainly have concerns and potential liability, in these cases as in all cases the appraiser would own the ultimate responsibility to the intended users and those parties able to rely on the report (per Certification #23) as to how the report was completed.

Copyright KB Shure 2011

Guest Author:  Ken Shure, Certified Residential Appraiser in the Los Angeles, California area.  Contact: kbshure@Yahoo.com

American Guild of Appraisers Fights to Overturn Federal Regulations that Dramatically Cut Fees and Threaten Profession

WASHINGTON, Nov. 7, 2011 /PRNewswire-USNewswire/ -- The American Guild of Appraisers (AGA), a national organization of real estate appraisers that is an affiliate of the AFL-CIO's Office and Professional Employees International Union (OPEIU), announced today it has retained a law firm as part of a broad-reaching effort to overturn recent federal regulations that dramatically cut the fees that appraisers are paid to perform appraisals, and threaten the viability of professional appraisal practice and the reliability of appraisals used in real estate transactions.

In the aftermath of the national financial collapse brought on in part by badly underwritten subprime loans, Congress found that inadequate appraisals resulting from undue pressure on the appraisal process was a contributing factor.  To address the problem, Congress enacted a series of appraisal reforms in the Dodd Frank law to ensure appraiser independence and accountability.  A key component of the legislation is a requirement that appraisers be paid Reasonable and Customary fees for their work.  Under the legislation, Reasonable and Customary fees are defined to ensure that appraisers are not undercompensated relative to the market and the nature of the assignment.  Responding to evidence that Appraisal Management Companies (AMC's) have been dominating the market and pressuring appraisers to accept assignments with unreasonable requirements and unreasonably low fees, the law specifically prohibits basing fees on the current practices of Appraisal Management Companies.   

Earlier this year, however, the Federal Reserve Board adopted implementing rules that have been interpreted by the banking industry and AMC's as permitting paying appraisers a fraction of Reasonable and Customary fees.  Appraisal industry experts also point out that in addition to controlling virtually all of the business, AMCs also dictate the turn-times for assignments that, in many cases, have been unreasonably set at 24 hours while at the same time increasing the details and requirements for documentation in the appraisal report.   

According to AGA President, Peter Vidi Jr. this is a big problem for appraisers, consumers and taxpayers.  "To understand this problem and its impact, first you have to follow the money," said Vidi.  "A borrower is required by the lender to pay an appraisal fee that represents whatever is Reasonable and Customary in that market. What the borrower doesn't know is that perhaps less than half of the fee that they are required to pay is actually going to the appraiser who performs the appraisal.  The rest, often more than half of the fee, goes to the appraisal management company.  AMC's are often owned or controlled by lenders and make big profits without the borrower's knowledge that his fee is an additional profit center for the lender or the subsidiary management company at the expense of the borrower.  Additionally, since the implementation of recent, well intended but poorly implemented federal legislation, the vast majority of appraisals for mortgages have been ordered through Appraisal Management companies that drive the fees down to professional appraisers while requiring the consumer to pay market rates.

"Why should anyone care?  If an appraiser is not paid a Reasonable and Customary fee and forced to comply with unrealistic turn-times for an appraisal assignment then the quality of the work product suffers," Vidi continued.  "Fees that are a fraction of Reasonable and Customary, along with the unrealistic and 'creeping' appraisal requirements are driving many good appraisers out of the profession.  We are seeing unprecedented numbers of seasoned appraisers leaving the market. Those that remain are forced to cram more appraisals into the workweek in order to earn a living.  The result inevitably will be less reliable appraisals and another round of poorly underwritten loans that could help to destabilize a fragile economy. The American Guild of Appraisers feels that it is time to take a stand for the professional real estate appraiser."

"From a legal standpoint, it's quite clear that Congress intended that appraisers be paid Reasonable and Customary fees and that most appraisal management companies are simply violating the law," said Matt Schneider with Garvey Schubert Barer, the law firm retained to represent the AGA.  "Unfortunately, the Federal Reserve has adopted regulations that AMC's are interpreting as permitting and validating their practice of paying appraisers a fraction of what is a Reasonable and Customary fee.  Regrettably, so far the Fed has been unwilling to take any action to ensure that both its regulations and the behavior of AMC's comply with the law."

Schneider said that his firm is reviewing all of the facts and the law and will be advising the AGA as to what options are available for legal action that may include a lawsuit against the Federal Reserve Board.

"Taking legal action against the Federal Reserve is not something that the appraisal industry would do lightly, but there may be no other option," said Vidi.  "This is far too important an issue to appraisers and consumers to simply walk away.  We are fighting for our livelihood and for the integrity of the work that we do."  

OPEIU President Michael Goodwin said that OPEIU and the AFL-CIO and their millions of members stand firmly behind the AGA.  "We support concerted action by the American Guild of Appraisers to protect the integrity of professional appraisal practice and the profession by ensuring that the federal agencies carry out the intent of the law."

ABOUT THE AMERICAN GUILD OF APPRAISERS/OPEIU GUILD 44
The American Guild of Appraisers/OPEIU Guild 44 seeks to represent the interests of appraisers, developing a strong presence before the U.S. Congress and each of the state legislatures.  By working closely and exchanging dialog with other like-minded organizations, the AGA works to educate consumers about the appraisers' non bias, independent role in the value process, while ensuring the accountability of both the appraisal profession and the financial institutions with which the appraiser provides services.

ABOUT OPEIU
The Office and Professional Employees International Union represents more than 110,000 members (representing 125,000 employees) in the United States, Puerto Rico and Canada. OPEIU represents employees and independent contractors in banking and credit unions, insurance, higher education, shipping, hospitals, medical clinics, utilities, transportation, hotels, administrative offices and more.

Professional organizations and Guilds affiliated with OPEIU are a diverse group that includes physicians, pharmacists, chiropractors, appraisers, podiatrists, clinical social workers, hypnotists, teachers and helicopter pilots.

 

SOURCE Office and Professional Employees International Union, AFL-CIO (OPEIU)

RELATED LINKS
http://www.opeiu.org

Article Source: WASHINGTON, Nov. 7, 2011 /PRNewswire-USNewswire/