Discussion in 'Illinois' started by Brian Weaver, Jun 1, 2011.
Brian-- I'm confused about the statement that borrowers need to understand the UAD abbreviations. I was under the impression that they are not intended users despite the fact that the lender has to provide them with a copy of the appraisal. So that would mean that we shouldn't have to consider their needs. Am I missing something?
This the first and one of the big problems with the UAD, normal people won't understand, AMC phone monkeys won't understand it, but from what I understand at least Wintotal will include an addendum that defines all of the codes. The only thing UAD will help is automated reviews and data mining. I have no doubt owners will be calling daily regarding the codes, even with an addendum.
Thanks again Brian for the news letter.
Although many appraisers understand and follow procedures and practices as described in some of the articles it really helps to be able to forward a copy of the news letter to a client who comments, "All the other appraisers do it", just for additional backing.
Everyone is going to run for cover behind "intended user". Don't kid yourselves about that. Half the complaints that I, and every other state regulator get, are from consumers. Most of the complaints now are because consumers (myself AND the board) can't figure out what appraisers are writing (and that's before UAD).
Be crystal clear in your reports. Take a UAD class. I'll be at one tomorrow. I shouldn't need Appendix D to figure out what you're talking about.
Everyone's on notice.
Fortunately, I do very little lending work nowadays, but will still stay currrent with the classes anyway. But I don't see it as hiding behind intended use. That's a legitimate part of the SOW and I'm concerned that we're now being warned that the intended user doesn't matter.
I do understand that homeowners will be more confused than ever, and that will increase complaints. I guess it's better than the dozens of reports I've seen over the years in litigation work where the standard Fannie Cert/Lim. Cond. pages are used, and no one cares.
Overall, I think the UAD is one more nail in the coffin for res work and will just increase the data mining and brevity of reports.
UAD and misleading appraisals
In a recent class, a statement was made concerning the UAD and USPAP concerning misleading appraisals. The focus of the "misleading" appraisal was based upon the new Quality and Condition ratings.
As appraisers, we will have access to the criteria that defines these ratings. But one of the leaders of the discussion stated that the typical reader will most likely not understand the ratings. That seems to be a true statement.
In your opinion, do you feel to remain USPAP compliant that the Quality and Condition ratings charts will need to be a part of each report, or will there be a different way of remaining compliant ?
Wait until some appraiser does a divorce case using Appendix D codes. The judge will love it!
Its important to realize that USPAP is truly blind to the complaint process in a given state. In fact, its largely blind to almost all state regs. Its as if USPAP exists on some other plain of consciousness.
In the UAD...if you have two baths but only ONE is remodeled...you must indicate that both baths are remodeled in the UAD nomenclature. However, we both know that Fannie wants you to roll to addendum and explain that only one bath was remodeled. They have built in a misleading report and have left it to the appraiser to "fix it'.
This is going to be a problem for everyone.
I remain unimpressed by the comedy stylings of Fannie & Freddie.
I was just talking to a potential client today about his divorce needs. He mentioned that the opposing appraisal was done on one of the Fannie forms. I directed him to the cert pages and asked what they said. He was already aware from his atty that they were the standard unmodified cert pages that limited the appraiser's usage for lending purposes.
He told me that they had raised this issue in court and that the opposing appraiser simply responded by saying that the pages couldn't be modified in his software! The first thing that came to mind was your potential response
All my divorce work cert pages are created by actually going through SR1 and SR2 and doing everything from scratch. Ain't cheap for my clients, but that's the only way. The same appraisal had less than 20 words discussing the condition of the subject property for which needs at least $20K worth of repairs. I'm never ceased to be amazed at the bad work out there.