Hybrid Appraisals

[Mejappz]

I will pose the same question I have asked before, are you equally concerned about the appraisers who are convicted felons, yet still go into homes? That happens every day. I know because when I worked at the AMC we regularly found appraisers with felony convictions. That is why AMCs require independent background checks. Each year we would find 5 to 10 such cases.

Sure, I'm concerned—and precisely why appraisers are licensed professionals regulated by state boards. If a licensed appraiser has a felony, it’s up to the state regulatory body to determine whether that individual is fit to practice. There's an actual governance structure, a disciplinary process, and a public record of enforcement actions.


Property Data Collectors, on the other hand, have no licensing, no background check requirements unless imposed by a third party like an AMC, and zero oversight at the state or federal level. If a PDC with a criminal history is discovered, there’s no board to report them to, no license to suspend, and no consequences beyond termination.


The system already has mechanisms to manage risk when it comes to appraisers. The problem is introducing unlicensed actors into a critical part of the valuation process without equivalent safeguards. Comprende?

 

[CGinMN]

I will pose the same question I have asked before, are you equally concerned about the appraisers who are convicted felons, yet still go into homes? That happens every day. I know because when I worked at the AMC we regularly found appraisers with felony convictions. That is why AMCs require independent background checks. Each year we would find 5 to 10 such cases.

By the way, this is a great argument against using national AMCs who will accept any lukewarm body with a license to their panel. As a lender with a direct panel, we know our appraisers by first name, we know their hobbies and interests outside of work, if they have kids, and we don’t cut them off if they need something reassigned because they’re battling an illness or dealing with a family issue. We send them a text or email and say thanks for all your hard work on xyz property. When they need to talk through an appraisal problem, they call us and we pick up. Is it foolproof? Probably not. Buy you can typically gauge someone’s professionalism much better this way than by doing annual $69.95 background checks.

 

[Mejappz]

My name is , Director of People Operations at True Footage, the largest residential appraisal company in the US.

I believe that Liss and True Footage lost their license in Illinois, which would make them prime candidates for all GSE work. Birds of the same feather.….

 

[RCA]

PART IV:

I had one of those long discussions with Grok-3, explaining a number of nuances. You can try this yourself (but be prepared to report to the rest of us the exact conversation).

Here is its final conclusion:
Grok-3: My Verdict
USPAP, as written, is a micro-tool in a macro-storm. Its short lifetime —weeks—means it can’t see or stop the compounding you’re worried about. It’s “effective” for getting a $10M loan out the door, but not for ensuring those hundreds of thousands of loans don’t bankrupt the system when the music stops. Reasonable for appraisers, sure—but not for the nation’s balance sheet. To fix that, you’d need USPAP 2.0: real-time market checks, bubble detectors, or tighter comp scrutiny. Right now, it’s a cog, not a brake. Does that square with the “talk” you’re hearing, or want to dig into a specific bankruptcy angle?
====
ME: So, if you had to give it a number from 1-10 to desribe how good of a standard it is, how would you rate it?

Grok-3: Rating USPAP as a standard from 1 to 10 depends on what we’re measuring it against—its stated goals (consistency and credibility in individual appraisals) or your bigger concern (preventing systemic financial collapse). I’ll split the difference and give you a clear number based on both lenses, since you’ve been digging into its short-term transactional role and its broader implications.

Criteria Breakdown

1. Consistency (Stated Goal):
   • Strength: USPAP’s rules (Standards 1 and 2) ensure appraisers nationwide follow a uniform process—comps, adjustments, reporting. Studies (e.g., Appraisal Institute, 2023) show 85-90% of appraisals align within 10% of sale prices in stable markets. That’s solid for a subjective field.
   • Weakness: Human judgment and market heat (e.g., 2021 bidding wars) still let variances sneak in.
   • Score: 8/10. It’s not perfect, but it herds appraisers into a tight corral.
     
2. Reliability (Stated Goal):
   • Strength: Lenders, courts, and feds (Fannie Mae, etc.) trust USPAP-compliant reports. Post-2008 ethics tweaks cut overt fraud—only 1-2% of appraisals get flagged for major issues (Appraisal Subcommittee data).
   • Weakness: Overvaluation creeps in during booms (e.g., 10-15% pre-2008), and the weeks-long window doesn’t catch it.
   • Score: 7/10. Reliable for most deals, but not bulletproof.
     
3. Systemic Stability (Your Concern):
   • Strength: It’s a baseline—without it, appraisals would be a free-for-all, amplifying bubbles worse.
   • Weakness: It’s blind to compounding overappraisal across thousands of loans. The chessboard pileup you described—$200B in fake value—slips through. It didn’t stop 2008, and it’s not built to stop a 2025 crash.
   • Score: 3/10. It’s a micro-tool, not a macro-shield.

Overall Rating

• For Its Intended Purpose: Averaging consistency (8) and reliability (7), I’d give it a 7.5/10. It’s a damn good standard for what it’s meant to do—keep individual appraisals defensible in those weeks before a $10M loan closes. It’s widely adopted, enforceable, and practical.
  
  
• For Preventing Bankruptcy: factoring in systemic stability (3), it drops to a 6/10. It’s not useless—it’s better than nothing—but it’s out of its depth when the stakes are national solvency.

Final Number

I’ll land on 6/10. Why? USPAP excels at its narrow job—standardizing appraisals deal-by-deal—but it’s only halfway there if we judge it against the economic catastrophe you’re eyeing. It’s like rating a hammer: great for nails (7-8), lousy for sawing logs (3-4). For your $10M loan, it’s solid in those weeks; for the U.S. not going bankrupt, it’s a bystander. Fair number, or you leaning higher or lower?

 

[RCA]

So, there you go, Grok-3 gives it a 6/10 --- and If I chatted with it longer, filling in more possibilities of things going wrong, I am pretty sure I could get the overall score down - way down.

 

[Mejappz]

I mean, the guy orchestrated an armed robbery of a Brinks truck which he was hired to protect.

Besides, the question for any lender or consumer isn’t “which would be more appalling?” It is, who is more likely to commit a crime of opportunity in someone home, licensed professional appraiser with their career serving as a deterrent, or Harry the can collector delivering chipotle bowls in between PDRs?

Those are precisely the individuals the GSEs want to conduct these so-called property data collections.

 

[Non Sequitur]

Well one thing is perfectly clear: Fannie and Freddie love PDCs. Do they love appraisers? Read their comments and decide for yourself.

 

[NC Appraising]

By the way, this is a great argument against using national AMCs who will accept any lukewarm body with a license to their panel. As a lender with a direct panel, we know our appraisers by first name, we know their hobbies and interests outside of work, if they have kids, and we don’t cut them off if they need something reassigned because they’re battling an illness or dealing with a family issue. We send them a text or email and say thanks for all your hard work on xyz property. When they need to talk through an appraisal problem, they call us and we pick up. Is it foolproof? Probably not. Buy you can typically gauge someone’s professionalism much better this way than by doing annual $69.95 background checks.

Where the heck have you been my entire life?

I wouldn't be such a negative Nancy if I had clients like that.

 

[chad hampton]

Of course, the logic of the gses completely falls apart when you bring up that plans and specs also have a 1004d final inspection attached to them. So there will be an inspection of the subject property by the appraiser who performed the appraisal.

But don’t let that get in the way of the kickbacks, bribes, and steak dinners.

 

[shrubberyvaluation]

There is very detailed and specific training for property data collectors for how they engage with the homeowner or property contact. They should not be impersonating or saying they are the appraiser.

I'm sure there are a lot of things they shouldn't do, but who cares, its not like they have a license to lose.