Comp Checks - Appraisal investigation changes the way ONE firm does business

According to the story Mitchell Maxwell Revises Appraisal Rules Amid Probe (Update1) by Sharon L. Crenson,

"Mitchell, Maxwell & Jackson Inc., the real estate appraiser subpoenaed in a state mortgage industry probe, said it won't provide preliminary values on homes it hasn't seen or allow customers to include their own estimates on orders."

"The appraiser, which valued about 9,000 Manhattan properties last year, won't do quick valuations based on comparable homes nearby, the New York-based company said in a note to clients on its Web site. It also won't accept orders from mortgage brokers or lenders that include estimated values. Such practices have come under scrutiny in several state investigations."

``Value, comp checks, or pre-comps of any kind (written or verbal) will not be performed prior to us being engaged for that assignment,'' Mitchell Maxwell said in its client note. ``Although most are used for legitimate purposes, some individuals use them to `fish' for the appraiser with the highest value estimate.''

Mitchell Maxwell wanted to address the issue to set an example for the industry, said Y. David Scharf, the company's attorney.

`Bad Business'   ``We decided, if that's an industry problem, we should address it,'' Scharf said. ``We didn't do it for other reasons, for other business reasons. We thought it was bad business to do that.''

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• Comp Checks - Value Opinions Put Appraisers "On The Hook"
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