The National Community Reinvestment Coalition, a Washington, D.C., nonprofit, has filed a complaint with the Federal Trade Commission alleging that Zillow does not adequately disclose the degree to which its free automated home valuations can over- or underestimate a property's value. The site is "likely to cause substantial injury to consumers who rely on the inaccurate representations made by the company," the complaint alleged.
In a confusing twist, a nonprofit group formed by NCRC to promote best practices in the appraisal industry has hired a company to provide Appraiser Assisted AVM services!
The NCRC offshoot, the Center for Responsible Appraisals and Valuations, is contracting with Eppraisal LLC to operate its www.BuySmartProgram.com Web site, which offers consumers appraisals using an automated valuation model in conjunction with the services of an appraiser.
NCRC vice president David Berenbaum said there is no contradiction in NCRC's complaint against Zillow and CRAV's use of an AVM on the www.BuySmartProgram.com Web site.
"The product being offered is an appraisal involving a site visit. It is not limited to an AVM," Berenbaum said. "We do not have a problem with accurate AVMs, especially if they are combined with (the services of) an appraiser."
Berenbaum said Eppraisal LLC is a subcontractor with no influence over policy decisions at NCRC or CRAV. Based in Mayfield Heights, Ohio, Eppraisal LLC offers access to a network of 10,000 appraisers through its Web site, www.uappraiseit.com. Their web site says: "For the past 5 years the nations largest banks and mortgage companies have been using patent pending technology, together with the expertise of a local appraiser, to deliver an AVMAA, the only appraisal product proven as accurate as an exterior only inspection by a typical appraiser, within 36 hours and for only $110.
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