Appraisal Scoop

Illinois "Appraisal Bill" HB 1015 must wait a little longer!

After three years of trying, it finally took a new Governor and a persistent ICAP to get Appraisal Bill - HB1015 passed. The Bill passed in the Senate on May 13th unanimously!  It then went to Governor Pat Quinn for his signature.

According to T.J. McCarthy of the Illinois Coalition of Appraisal Professionals (http://www.ICAPweb.com ):

"The long awaited signing of the Appraisal Bill will have to wait a little longer. Today the Governor made an amendatory veto and sent the Bill back to the House of Representatives. This means that we will have to wait until the fall for the House and Senate to accept the Governors suggested amendments and ultimately get this 3 year Bill to finally become a law. ICAP does not anticipate any future problems."

Here is the Governor's letter:

August 10, 2009

To the Honorable Members of the Illinois House of Representatives 96th General Assembly

  Today I return House Bill 1015 with my specific recommendations for change. This bill contains language conditioning the Department of Financial and Professional Regulation’s rulemaking ability on compliance with the provisions of the Illinois Administrative Procedure Act. This language is a remnant of the controversy surrounding certain rulemaking undertaken by my predecessor’s administration. In approving House Bill 398, my administration is committed to upholding the law and respecting the constitutionally protected powers of each branch of government. I approved House Bill 398 as a demonstration of this commitment. My approval of House Bill 398 renders the language related to rulemaking in this bill moot. It is time to move past the battles between my predecessor and members of the General Assembly. I am, therefore, deleting this language from the bill.

Therefore, pursuant to Article IV, Section 9(e) of the Illinois Constitution of 1970, I hereby return House Bill 1015, entitled “AN ACT concerning regulation.”, with the following specific recommendations for change:

on page 12, by deleting lines 20 through 26; and

on page 14, by deleting lines 22 through 26; and

on page 15, by deleting lines 1 and 2.

With these changes, House Bill 1015 will have my approval. I respectfully request your concurrence.

Sincerely,

PAT QUINN Governor

 

You can read the bill as introduced here: http://tinyurl.com/oh9ec4

The following is a brief Synopsis of some of the changes.

Synopsis As Introduced Amends the Real Estate Appraiser Licensing Act of 2002.

• Makes changes throughout the Act that mark the transfer of authority to administer and enforce the Act to the Department of Financial and Professional Regulation (rather than the Office of Banks and Real Estate).
• Makes appraiser licensing/certification MANDATORY in Illinois, rather than voluntary.  Previously, licensing/certification was only mandatory in connection with federally related transactions.  It will now be mandatory for any appraisal service.
• Replaces "associate real estate appraiser" with "associate real estate trainee appraiser" throughout the Act.
• Changes the Real Estate Appraisal Board to the Real Estate Appraisal Administration and Disciplinary Board.
• Provides that a person who violates certain licensure provisions for a second or any subsequent time is guilty of a Class 4 felony.
• Sets forth additional education requirements for licensure under the Act.
• Removes a provision allowing a person who holds a valid license as a licensed real estate appraiser, issued pursuant to a predecessor Act, to convert that license to an associate real estate appraiser license.
• Removes a provision concerning licensed real estate appraiser's licenses issued pursuant to a predecessor Act and provides that an associate real estate trainee appraiser license may not be renewed more than 2 times.
• Adds a provision concerning temporary license suspension.
• Provides that an education provider may use an instructor who is a faculty member in good standing with an accredited college or university or community college or who is an approved appraisal instructor from an appraisal organization that is a member of the Appraisal Foundation. Imposes conditions on any rulemaking authority.
• Makes other changes.
• Repeals a Section concerning identifying a client. Effective Immediately

Source: http://www.ICAPweb.com

Approved Bill (Mark-up) Download IL Real Estate Appraiser Licensing Act HB1015

 

Video: Comp Checks, Look-sees, Pencil Searches and other nonsense

I attended the Illinois Coalition of Appraisers (ICAP) update seminar in Springfield, IL yesterday. 

In attendance were such notables as, Debra Brown from the Anti-Fraud Division of Fannie Mae, Joan Trice from Appraisal Buzz and Brian Weaver, our new Illinois Director of Real Estate Appraisal.

Brian Weaver has been an active appraiser and it really shows in his animated depiction of the various "Comp Check" calls that residential appraisers field on a daily basis.

Click Here: Comp Checks - Values Made To Order

Ultimately, Brian concludes that "If the requester wants you to filter data for a specific property-type or address . . .then you've performed an appraisal!"  He also stressed the requirement to retain a workfile for all appraisals, including Comp Checks. 

Brian cautions, "Your worst guess at value . . .holds the same liability as your best full-inspection appraisal!"

Can you check comps for me? I don't want to waste my borrower's time or money!

How many times have we ALL received that call from an out of town lender or broker that's either shopping for a value or MAYBE (I'll give them the benefit of the doubt) just in need of a little help on qualifying a borrower?

Stuart Fearer SRA of Tamarac, Fl (electronicappraisers.com) gets lots of those calls too, but rather than just blow them off, he's taken the approach of EDUCATING the callers on how they can get the information they need more efficiently:

"Any time you can get the requester to perform the comp check themselves, (ie; sending them to Fastweb, the County Assessors web site or zillow.com and tell them to print the comps from the screen after the zestimate) you avoid any appearance of wrongdoing or USPAP violation. I usually "sell" them on this by pointing out that they can get instant gratification instead of calling up a bunch of reluctant appraisers."

"I point out the time they save on this and all future requests and how they will be "empowered" by pulling up their own comps. Then I tell them to call me if it's in the range of the comps to place the order or even if it is close. I have actually gotten orders from doing this."

Click below to read Stuart's "Zillow Comp Check Instruction" email . . .

Illinois Appraisal Director's Term Ends - Help Reappoint Mike Brown

Mike Brown will end his term as Appraisal Director of the Illinois Real Estate Appraisal Administration Division on November 30, 2006.  The Appraisal Director of the Illinois Real Estate Appraisal Administration Division is reappointed to a four year term.

Illinois law reads as follows: 

"In appointing the Director of the Real Estate Appraisal Division, the Commissioner shall give due consideration to members, organizations, and associations of the real estate appraisal industry.”

The Chicago Chapter of the AI and all other appraisal organizations in the State are joining together to support the reappointment of Mike Brown. 

The Illinois Coalition of Appraisal Professionals (ICAP) has created an on-line petition asking the State to retain Mr. Brown for another term.  We would urge all of you to sign the petition. 

Click on the following link, http://www.ipetitions.com/petition/RetainMikeBrown/ 

or go to  www.icapweb.org and sign the petition.

Please help us to acquire as many signatures as possible.  The petition site has three tabs at the top of the screen.  One to sign the petition, one to view who has signed the petition and the last is to send an email invitation to a friend to sign the petition. 

Thanking you in advance for your support. 

The Chicago Chapter of the Appraisal Institute office

Illinois - "Comp Check" Complaint Form

Our earlier blog post Can you check comps for me? I want to know if I should order an appraisal included the ICAP instructions asking appraisers to email Value/Comp Check requests from lenders to the Illinois Department of Professional Regulation. 

ICAP has now been informed that Illinois has a special form [(6-2(4) Report] that appraisers must fill out and mail-in with a complaint.

Section 6-2(4) of the Residential Mortgage License Act of 1987 (“Act”) provides for the submission to the Office of Banks and Real Estate (“OBRE”) of an incident report involving an employee of a licensee that has knowingly submitted or caused to be submitted documents that contain willful and material misstatements of facts in connection with any licensable activity as defined in Section 1-3(a) of this Act.

Appraisers can sign the complaint if they want, or can simply write in the word ANONYMOUS on the signature line. The State told ICAP, "the more complaints against a specific lender the better".

Please mail your complaints to: IDFPR, Banking Division, Attn: Elba Aceveda, 122 S. Michigan Avenue, Suite 1900, Chicago, Illinois 60603

Download the 6-2(4) Report "Complaint Form" - click here.

Appraiser Identity Theft

According to Brian Weaver, a practicing appraiser for over 25 years and investigator for the Office of Banks and Real Estate in Illinois, has recently researched Appraiser Identity Theft in Illinois and others states. Click here for the complete report: License To Steal The Illinois Coalition of Appraisal Professionals commissioned this study and resulting article. www.icapweb.org

Brian Weaver has suggested that there are three main scenarios of appraiser identity theft and forgery currently taking place.

• First, there is the appraiser-trainee who is fed up with splitting fees with their sponsor/ mentor and has decided to forge their mentor’s name and affix their mentor’s license number to reports without their mentor’s knowledge or permission.
• Second, there are appraisers who go phishing for license numbers. The term phishing refers to the current internet ploy by computer hackers to scour cyberspace for usable personal data that can be exploited.
• The third and most disturbing trend involves persons who never were licensed appraisers, yet find this to be their crime of choice. Like those who go phishing, they come up with almost random victims and prepare bogus reports for hefty fees.

What Can Appraisers Do To Protect Themselves? - READ ON . . .

Mortgage Fraud - "Universal Truths" - Part 1

I attended the Illinois Coalition of Appraisal Professionals (ICAP) sponsored 2006 Illinois Appraisers Update Seminar on 6/1/2006. Representatives from Fannie Mae, HUD, and the IL Appraisal Division of the Dept. of Professional Requlation spoke on a variety of topics including:

• Common Appraisal Errors
• Mortgage and Appraisal Fraud
• Appraisal Forgery
• Identity Theft

Brad Geary, Assistant Special Agent in Charge from HUD - Chicago, OIG - provided some insights from the perspective of a field agent. Mr. Geary, in his self-deprecating fashion, claims that he's only an expert in the "obvious"! He feels that most fraud becomes apparent once a pattern is recognized. To become aware, we have to understand the Universal Truths of Mortgage Fraud listed below:

• Appraiser Fraud
• SSN / Identity Fraud
• Credit Reports / Letters of Explanation
• Ernest Money & Closing Costs
• Verification of Employment
• Verification of Bank Statement (Deposits)
• Verification of Landord

According to Mr. Geary, virtually all mortgage fraud combines at least two of the items above.

An example of this is the case of Wanda Morgan Tyler, 60, of Duluth, Georgia. She was sentenced June 2006 by U.S. District Judge Thrash on charges of mail fraud, relating to a scheme to defraud the Dept. Veterans’ Affairs (“VA”). Tyler was sentenced to 33 months in prison to be followed by 3 years of supervised release, and found liable for approximately $900,000 in criminal restitution.

• In over a dozen cases, Tyler created and submitted to the VA false wage statements, bank records, and other financial documents in the names of the purchasers that she represented, often without the purchasers’ knowledge. She did this to mislead the VA as to the credit-worthiness of the purchasers, thereby ensuring that the transactions would be approved and that Tyler would receive substantial commissions.
• In some cases, Tyler submitted bids under false identities that she created.
• As part of her scheme, Tyler used several aliases and different companies, all to conceal from the VA that Tyler was behind the scheme.

The VA lost over $900,000 as a result. This includes over $180,000 that the VA paid to Tyler in commissions from these fraudulent transactions, as well as over $720,000 in foreclosure losses, as almost all of the purchasers or purported purchasers defaulted on their mortgages.

All of us know that the 3/2005 Fannie Mae appraisal forms (Eff. 11/2005) had significant changes in the amount of information that appraisers need to research and verify. Looking that the list above, it's clear to me that many of the items on the new forms are designed to address the list of "Mortgage Fraud Universal Truths" above