Virgina REAB and Portal Petition

[Joyce Potts]

A few things come to my mind in reading all the post so far.

1. Are any state boards even interested in this problem?
2. How could AI do something like this to appraisers and get away with it.
3. There must be an Attorney General in some state willing to look into this problem.
4. I believe what many of these companies have done in fraud.
Jim Hill

1. Most appraisers don't understand it, much less laymen on the boards.
2. Don't get me started--you have to be joking.
3. Cuomo started to. Others won't until they're forced to.
4. If the states simply start enforcing Cert 24 as to ORIGINAL SIGNATURES and what they mean, there would be no need for additional regulations.

 

[Pamela Crowley (Florida)]

Jim Hill,

PLEASE come to the FREAB meeting, Tuesday, June 3rd. !!!!!

 

[c w d]

1. Most appraisers don't understand it, much less laymen on the boards.
2. Don't get me started--you have to be joking.
3. Cuomo started to. Others won't until they're forced to.
4. If the states simply start enforcing Cert 24 as to ORIGINAL SIGNATURES and what they mean, there would be no need for additional regulations.

I don't think the way to argue this is to point fingers at who's right and who's wrong. After all, the appraisers using AIready portals are agreeing to the changes or even agreeing to say they themselves are making these changes. I think the wording of the agreement could be argued endlessly for years.

No, I think the way to approach this is to attack it from the stance of USPAP compliance. Is the appraisal transmitted to the client through the AIready portal USPAP compliant? This is what needs to be determined. If it is not then regardless of who bares to responsibility and liability, the client or the appraiser, the appraisal can not be relied upon because it is not a credible appraisal report. The secondary market (FNMA, freddie, etc) REQUIRE a USPAP compliant appraisal. If what they're getting are loans based on appraisals that are not USPAP compliant then the ramifications would be broad requiring changes to the way the AIready portals handle the appraisals. If some appraisers have to be "scrutinized" by the state boards in order to determine that, then so be it.

 

[Oregon Doug]

...

No, I think the way to approach this is to attack it from the stance of USPAP compliance. Is the appraisal transmitted to the client through the AIready portal USPAP compliant? This is what needs to be determined. If it is not then regardless of who bares to responsibility and liability, the client or the appraiser, the appraisal can not be relied upon because it is not a credible appraisal report...

I fully agree with you on this point, but there is a fly in the ointment: Only appraisers are subject to USPAP - not the various orginizations or their portals. The various state appraisal boards have authority only over appraisers - they have no authority over the portals. So the remedy must come from a different source.

I agree that once an appraiser is made aware that the reports that he sends through these portals are no longer credible - he must immediately cease using these portals or face the ramifications of KNOWINGLY submitting non credible appraisal reports. But at this point, the best solution is to educate appraisers. From what I've seen so far, very few (if any) appraisers even know about this. Enforcement can only begin after education.

Oregon Doug

 

[23Degrees]

Posts 43 and 44 are key in understanding this whole issue and from what I have read so far:

1 - The appraiser gives no direct or implied authorization for signature placement by any intermediary in these cases.

2 - The appraiser has the ability to view the final conversion product prior to it being sent to the intermediary (AMC or Portal).

Therefore the appraiser is fully responsible for what this final conversion contains, USPAP compliant or not.

I wonder how many of those who utilize this software actually view the final product prior to sending it forward and maintain an actual copy in the workfile. It seems like that might be the bigger issue as things currently stand.

The use of this software creates an added step for the appraiser – after you create the report in your software and convert it, you must review the conversion prior to transmission to make sure you still have a credible USPAP compliant report.

If you don’t do this or send it anyway then of course you are responsible and this should be made crystal dummy-proof clear. Either the boards can do it or maybe case law will. Just ask yourself: In the hypothetical case of a huge loss by an investor that occurred in large part due to an addendum being removed during conversion prior to transmission from the appraiser’s computer where does the responsibility lie? Once shown that the appraiser had the ability to be aware of this prior to clicking the send button everyone downstream will be off the hook – take that to the bank.

If this were to be made clear it would be quite easy to move forward to the subject of whether or not it is in any way reasonable to require appraisers to undergo this extra step without knowing if they will actually end up with a credible report until after they complete the work and convert it. I can empathize with those who end up with an un-editable change that basically wrecks the report as has been reported on the forum. Right now the solution for any individual or firm appears to be either:

1 – Don’t utilize the software

2 - Check every report after conversion and either figure out some way to maintain the report’s credibility or don’t send it. I’ve heard that this can take hours in some cases and is unachievable in others.

A better solution would be to standardize the transmission format – or at least mandate that any format utilized must allow for complete editorial control at the appraiser level. If the changes during conversion for this software were on par with what takes place with pdf conversion I doubt there would even be a discussion taking place on this.

 

[Workbox]

I would ask; "was the programs true initial intent to be USPAP compliant, or for other Purposes?" What was it's creation for?

 

[TJSum]

"2 - Check every report after conversion and either figure out some way to maintain the report’s credibility or don’t send it. I’ve heard that this can take hours in some cases and is unachievable in others." From 23degrees


Yes, it is an extra step, and yes one needs to spend a lot of time on it. If an appraiser uses a conversion program where they see some changes have in fact been made to the report, no matter how minor, how can they not go through the entire report with a fine tooth comb searching for any other potential changes which might not be agreeable to them.

But the $64,000 question still remains, why is the client demanding use of their software? Is just for easier data mining (which is bad enough) or is it to have the capability to edit ones report after transmission.

 

[Smokey Bear]

Hmm, they make us pay to use it, steal our data, and make sure it's set up for US to take all the liability for them screwing with the report. Smart lawyers. Dumb appraisers.

 

[c w d]

I fully agree with you on this point, but there is a fly in the ointment: Only appraisers are subject to USPAP - not the various orginizations or their portals. The various state appraisal boards have authority only over appraisers - they have no authority over the portals. So the remedy must come from a different source.

Oregon Doug

That is correct. The state boards can't go after the client for something the appraiser did.

I was thinking more along the lines of "the path of least resistance". My statement also has broader ramifications. If it can be proven that the transmitted report that the client receives is non-compliant with USPAP then the secondary market could be made to stop accepting such reports and thus the conversion could be made to cease. But, it would have to be proven in a court of law where a judgment could be made requiring the immediate cessation of the conversion. In the meantime, if the conversion does render the appraisal non-compliant then the state boards have a responsibility to penalize appraisers transmitting non-compliant reports or force companies to stop requiring it. This would effectively reduce the practice of converting appraisal reports. The appraiser would have to knowingly make a decision, convert the report and risk penalties or not work for clients requiring it.

But, the case would have to be made to the state board that the report is not compliant with USPAP. The state can't be responsible for insuring their appraisers produce appraisals that are USPAP compliant AND allow a process to continue that clearly renders reports non-compliant. If the state board is unwilling to take such action then a suit against them should be made as well. At the point they are forced to recognize the failure of the conversion to transmit a non-compliant report then would either have to go after appraisers doing it or require that all appraisers in that state cease doing business with companies that require it or force those companies to stop requiring the conversion as part of the conditions for employment.

Lets face it, none of us are going to go to the board and convince them of anything to this extent. The only way to do so is to force the issue through a binding judgment of law.

This doesn't have to be a nationwide assault for it to be successful. A state by state endeavor would be sufficient.

The question that has to be proven before this type of action would have a chance of success is "Does the conversion process render the report non-compliant with USPAP?"

But the $64,000 question still remains, why is the client demanding use of their software? Is just for easier data mining (which is bad enough) or is it to have the capability to edit ones report after transmission.

What does the clients' motives matter? IMO, they do not. You can't argue, with a hope of success, that they can't use your data however they want when you sign the agreement that says they can. Not without years and years and year of litigation. The path of least resistance is the USPAP argument I stated above.

 

[TJSum]

"What does the clients' motives matter? IMO, they do not. You can't argue, with a hope of success, that they can't use your data however they want when you sign the agreement that says they can. Not without years and years and year of litigation. The path of least resistance is the USPAP argument I stated above." CWD Quote.


But isn't that the issue at hand, are the reports being changed AFTER appraiser transmission by the client in any fashion ??? Most people would consider that fraud.

I am not sure where the non-compliant with USPAP notion is coming from prior to transmission, as long as the appraiser has edit control over the report during the conversion process, and can be sure of what they send before it is sent, how can it be considered non-compliant with USPAP.

Yes, I did try both conversion programs once, and refused to send the end result, but I did not wish to spend the countless hours it takes adapting to it and making sure all the "changes" were caught and passed my internal review process before hitting that send button. It is not the conversion process that would make it non-compliant, it would be the individual appraisers lack of due diligence when using it because they still have final control over what is sent.

I think the issue is what happens to our reports after we are done with them...