Appraisal Scoop

The "Right Start" - Step 3 - Association

AUTHOR:  Patrick Egger is a Certified General Appraiser located in Las Vegas, NV. He teaches continuing education classes on the housing market, appraisal issues for real estate agents and appraisers. Click on Outside The Boxes for a collection of Patrick's articles on Appraisal Scoop!

For those that read the first two parts of “The Right Start”, we are about to enter “uncharted waters”. With the advent of the HVCC (Home Valuation Code of Conduct), once again we are hearing calls for “unionization”, “guilds”, etc. It is not that I think that unions are bad; it is simply that I have never been much of a joiner. I don’t want to be on a picket line or signing up new recruits. I would rather be watching a game and drinking a beer.

Since we already have numerous “professional associations”, do we need another or perhaps just something different? The problem is not the lack of associations, but rather the absence of “one association”, that represents “all residential appraisers”. By different accounts, there are more than 100,000 licensed residential appraisers in the US. When you add the number of trainees, I would expect a 50% or greater increase.

The memberships of the AI, ASA, NAIFA, etc. include residential and commercial (personal property and retired appraisers as well) and likely total less than half the number of active licensed appraisers, leaving the vast majority under-represented or without a voice. This is not about forming a “competing association” for “professional designations”; this is about “organization” to provide an “umbrella” that covers residential appraisers under one banner.

Copy the leader – the Power of One

Nationwide there are millions of real estate agents and the overwhelming majority are members of the National Association of Realtors. NAR members also join other organizations (Chamber of Commerce, Better Business Bureau, etc.) and sub-organizations (local MLS, Women’s Council, etc.). Many have designations (CCIM, GRI, etc.) from different groups, however all are members of “one organization”, NAR and that is the point.

Click here to continue reading . . .

RUNT RANTS - Mr. Big and a la mode deserve applause!

AUTHOR: Ken Verrett is the owner of Acorn Appraisal Associates, a 22 year old firm offering a wide range of quality appraisal services to the Financial and Business Communities in the greater Houston SMSA

I was a little surprised and disappointed at the lack of appraiser response to the David Biggers, CEO of a la mode, announcement that a la mode intended to create an order assignment feature on their web site at a very low fee for the service.  The announcement was featured here.  A La Mode Announces new feature

Mr. Biggers announced something BIG.  Something that could save appraisers thousands of dollars a year.  Something that could change the landscape for appraiser marketing if they choose to use it. Yet there were only five comments to that announcement here on Appraisal Scoop!

Maybe appraisers didn’t take the time to read what Mr. Big announced?  Maybe appraisers didn’t think through the implications?  Maybe…they don’t care?

Let's Look At The Situation

Let me see if I can illustrate the proposal in a different way….stick with me here…I’ll be short and succinct for a change.  Consider the following three models.

• Green is what the Fee Appraiser receives from his local clients currently. 
• Yellow is what the Fee Appraiser receives from the typical AMC currently. 
• Blue is what Mr. Biggers proposes to offer as an alternative to the yellow.

What Those Three Senarios Mean

If the Cuomo Agreements were to survive as currently written (a debatable assumption, but still we should consider it as a possibility) local lenders will be forced to find an intermediary to order appraisals for their loan applications. The most likely intermediary is an AMC. That’s the business they are in…to order appraisals for lenders.

If the Cuomo Agreements survive, there will be pressure in the next few months for your local clients to begin moving business away from you directly and instead through an intermediary.  (The drop dead deadline in early fall….that’s to allow for the pipeline…it takes around sixty to ninety days to process a loan in many instances, so an application taken in October will likely go to the lender after Jan 1^st at which time an intermediary will be required.)

Business that you currently get under the green scenario will begin moving to the yellow scenario.  You will be doing the same appraisal, you will be doing your same quality control, you will be proving the same service that you do now…but your fee will be $105 less….30 percent less!

Got that?! The same service, the same quality, the same appraisal, but your fee will have dropped from $350 to $245. Multiply that by the number of local lender assignments you receive monthly.

If that calculation gets your attention, you should re-read Mr. Biggers announcement.

Click here to continue reading . . .

Runt Rants - New additions, Outsourcing work to India, and Zaio Technology

Well, well, well...can it be eight weeks, two whole months since I've had something to contribute? By golly so it has...last post to Appraisal Scoop was Sept 10th. More than two months actually. That last post chronicled the down market we are in, the use of good accounting software to constantly analyze your business, and another view of an "insulting appraisal request".

I've been applying those general themes in MY business for the last two months. Hopefully you've been doing the same.

I'm beginning to see signs that the liquidity squeeze is easing... somewhat... but I now expect impact from the fallout from the Sub Prime crisis to linger well into next year. Acorn's volumes the last three weeks show signs of the market returning, the local market's entering a drop zone, and impact from our marketing efforts. That's two pluses, and one minus. Since I know my business pretty well as a result of utilizing my accounting software to analyze trends, I can detect each of those...hopefully you can now do the same.

Acorn is involved in several major projects this fall and my time and the Bright Horses time is devoted in significant ways to all of them. What a pleasure to see the management team that Acorn has built over the last eight years now beginning to pay off in a major way! Of course, I've chronicled our move beginning in the year 2000 from a one man operation to the vibrant business of today. In the early years we chronicled the passage on a couple of Internet forums. In the last year it's primarily been here on Appraisal Scoop. I hope you've been able to keep up with the journey.? Acorn is now a global company with global resources!

Since my last post, several major events have occurred. . .

Appraisal Institute, ASA, ASFMRA and NAIFIA Join Forces on Government Relations

RISMEDIA, Jan. 23, 2007- Legislators and government officials will hear a unified voice from the real estate appraisal profession during 2007, thanks to an agreement signed by the four largest appraisal organizations in the United States.

The Appraisal Institute, the American Society of Appraisers (ASA), the American Society of Farm Managers and Rural Appraisers (ASFMRA), and the National Association of Independent Fee Appraisers (NAIFA) have signed an agreement that will enable the organizations to work cooperatively in the area of government relations.

Under the agreement, the Washington, D.C. Office of the Appraisal Institute will be responsible for monitoring proposed real estate legislation and will keep members of all four organizations informed of relevant federal and state regulatory real estate issues.

Click here for the complete article.

Runt's Rants: What We Got Here . . .Is FAILURE To Communicate!

Last evening I attended the birthday celebration for one of my DILs (Daughter In Law).  Attending were her husband, mother and dad, brother, brother's lady, and my wife and I.  For those with DILs, you realize that In Law relationships are generally somewhat distant and guarded in the early years, especially when compared to the relationship of the immediate family of one's birth.  We are in those early years.

I was seated in a location ideal for observing the interaction between my DIL, her husband, and her brother.  It was a joy to observe.  Communication on a verbal and visual level that demonstrated a level of trust and understanding among the three to which all interactions should aspire.

As a keen observer of the world around me (aren't all appraisers experts in this area?)  I am forever alert to ways to improve and make more efficient the difficult and imperfect art of interpersonal communication in my business.  It is especially important in my current capacity as mentor to my team from a remote location.  We communicate daily, usually for a couple of hours, mostly via Instant Message, some email, and infrequently via telephone.  The challenge lies in making those communications clear, accurate, and absent of unintended conflicting signals.

At dinner last night, the exchanges between the three mentioned were quick, short, and conveyed accurately.  A word here, a glance there, a gesture, a knowing smile.  All without any unintended conflicting signals subject to misinterpretation.  That's the standard I want in my business!

Read on . . .   

Time Management and Multi-Tasking For Appraisers

Ninety-five percent of the problems you and I have in the area of time management are not really about managing time at all. What most of us call time management is really about managing our attitude.

According to Darryl Davis' article for Realty Times:

" . . .time management is really an attitude issue, not a technique issue. By attitude, I'm talking about being truly focused on and enthusiastic about your goals."

"When you're really passionate about your goals, your vision, your next level, etc., you'll automatically do the most productive things to achieve those goals. Without the proper attitude, the best techniques in the world won't have much impact."

Click here for more on the Fundamental Concepts of Time Management

Electronic Signature Security On Appraisals - ApproveIt® Desktop

In my previous blog post "Digital Security on Appraisals - Fighting Fraud" I looked at two different appraisal security solutions.  Appraisal Matrix, LLC sells a digital barcode software package that is able to barcode / encrypt individual appraisals.  a la mode, inc's answer to document security (currently available for mortgage professionals) is SureDocs. Click here to see how it works.

Both of those options seem rather involved to me?  I thought there might be something else available that would fill the bill for appraisers.  What I found was ApproveIt® Desktop, Silanis’ electronic signature software developed for commonly used desktop document formats.

ApproveIt Desktop is designed for offline signing processes and internal, ad-hoc operational applications. Supported applications include Microsoft Word®, Excel®, Adobe PDF™, Adobe eForms and IBM Workplace Forms™.

I downloaded their full working copy demonstration software to give it a spin. Read on . . .

FSBO Sites Collaborate for National Coverage

An interesting new online for-sale-by-owner company According to RealBlogging: "By Owner MLS, has just announced a free, online, public-domain listing service, linking together the homes, condos, timeshares, rentals, vacation homes, town homes, multifamily homes, vacant and commercial properties of many different FSBO companies. No registration is required and every property is linked back to its originating for-sale-by-owner site."  For more information go to ByOwnerMLS.com.

This is an interesting "collaborative" business model on several levels. 

• They're pulling together (or linking) the previously fragmented property sites listed above into a an easy to use search engine. 
• They don't require that the user "register" to use the search engine (lead generation).
• The standard and advanced search engines are easy to use.
• There is an Appraise Now! feature from the listing page.
• From the listing page you can also click on (More listings in "Your County")

What We HAD Here Was A Failure To "Collaborate"!

The concept of Web 2.0 is essentially the idea that the online world is a dynamic and interactive place, brimming with knowledge to be shared and relationships to be made.

It's ALL about the conversation!

My original blog was designed around a traditional concept of posting just about MY "personal" thoughts and experiences, along with an amalgamation of other interesting news stories and blog posts that I came across. 

The problem with that blogging concept is that it's very limiting in its scope.  Or as the Captain might have said:

"What we got here is . . .failure to collaborate."

My goal is to CHANGE the way Appraisal Scoop works. I want Appraisal Scoop to become a true conversation and collaboration tool by:

• Promoting Guest Author generated content (articles)

• Gathering members’ feedback (comments)

• Developing and exploring new ideas, technologies, concepts

READ ON . . .

Digital Security on Appraisals - Fighting Fraud

The recent issue of Working RE (Summer 2006) has an article of particular interest: "Fighting Fraud: Digital Security on Appraisals."  The author, Kirk Pruitt, is the CEO / Founder of Appraisal Matrix, LLC, a company that sells a digital barcode software package that is able to barcode / encrypt each individual appraisal for $129 per year.

According to the author, his software compresses encrypted data - such as appraiser info, value, address, client and date, then generates a 2D data matrix symbol to insert into the appraisal report as a Bitmap image. The client on the other end is able to decode and access the information to verify it independently via a one-page report to print and compare with the appraisal report.

Dave Biggers, Chairman, a la mode, Inc. reported on the WinTOTAL Users Group his company's plans for a competing product, SureDocs! . . .

I don't know if you've seen our SureDocs system for elecronic mortgages yet, but it achieves this same purpose (plus much more). It not only provides true e-signing of documents (as opposed to digital signing, which is just a picture of a signature), but it inserts a string of ID characters below each signature. Those characters change each time and represent the name, date, subject, signatories, pages, etc. of the document. If someone types the address into our website, they see the reference data and the ID which should accompany it; if any of the data is changed, it will be obvious. If the signature has been lifted and applied to another document, it's also obvious, because the address won't exist in the database at all.

We're applying SureDocs to appraisals as well very soon. It's a PDF driver, plus a delivery system (even if there's no XSite involved), and an encryptor. It also takes our SureReceipts concept to the next level, with page-by-page receipts logged in the system (you can tell which pages they read, and when).

• In the appraisal arena, it will add the appraised value to the ID encoding, of course, and allow you to add a cover page explaining the ID and how the client or eventual appraisal user can check the authenticity.
• We'll also offer additional levels of authentication of the individual appraiser (higher levels of authentication than just self-witnessing).
• And, naturally, we'll give it the ability to copyright your photos and report at print/delivery time, even if you don't use WinTOTAL.

You can download the mortgage version for free at http://www.alamode.com/products/Mortgage/SureDocs/.

There's also an overview video at http://www.alamode.com/products/Mortgage/SureDocs/video.aspx.

While it's clearly designed for mortgage loan documents, you can instantly see how it will be modified for appraisers. Download it, send yourself some docs, and play with the receipts, signing, and the ID process. The signing would of course be automatic and at the beginning (mortgage loan officers send docs off to be signed, whereas you send off signed docs -- reversed), but you'll see where it's going.

"We already have several thousand loan officers using it daily for three-day RESPA disclosures and full contracts. MILA (a national wholesale lender) just endorsed it publicly too. It's gaining rapid traction in e-mortgages, and we think it will in appraisals as well. - Dave Biggers, Chairman, a la mode, Inc."

An agent-centric contract signing version is also on the way. Simply put, signature and document security are something you'll see us taking the lead on in multiple markets.

Dave Biggers, Chairman, a la mode, inc.