Collateral Underwriter "suggested Comparables"

[ucbruin]

And you know this to be true how? I highly doubt that CU is programmed to "think" that any particular % of the price per square foot is typical as the the model uses regression analysis to to extract what it believes the correct adjustments should be. As a result, while CU may determine that ~30% price/sf is the correct GLA in some markets or possibly that is the median amount of the GLA adjustment on a national basis, there is no doubt that CU would determine that the correct GLA adjustments in some markets would be substantially different than the 30% sales price.sf ratio. Appraisers should not base their adjustments on what they think CU wants to see, but they should base their adjustments on market data and provide adequate support for those adjustments.

Regarding the CU SF example:

Q:
Would CU base what it determines to be "the correct GLA adjustments" based upon data provided by recently obtained appraisals or by some other data source which is not appraisal based?

 

[djd09]

CU absolutely analyzes the potential "comps" prior to issuing CU warnings and it even numerically ranks the potential comps and the appraiser's comps in order of the model's preference. That being said, CU is an automated computer program that is not 100% accurate and the data that feeds CU, while being better than most property data sources since it is appraiser vetted and provided data is not perfect. CU is not meant to be the be all and end all regarding appraisal quality or be the sole determinant of whether the lender should accept the appraisal. It is a tool to assist lenders in the evaluation of the appraisal and collateral and when used correctly, is a very powerful tool to help identify increased collateral and appraisal related risks. Undoubtedly, some lenders will use the tool properly, and some lenders won't have a clue...but that is nothing new.

Whether you choose to educate yourself on something that is going to have a large effect on the your profession as a residential appraiser is up to you. You can act like a professional and educate yourself so you can intelligently address the issues that undoubtedly arise as a result of many lenders using the CU tool or you can keep whining about what you can't change (i.e., appraiser access to the tool) and not educate yourself and continue to wallow in your own ignorance.

Try some better reading comprehension. Nowhere in my post did I call you or anyone else a name

"continue to wallow in your own ignorance"
and this is not the first "ignorant" comment you have made my way.

 

[timd354]

timd has a very impressive resume. From Certified Appraiser, mortgage broker, FNMA employee to his current position (my apologies for leaving something out). He is fully aware of the problems in the industry. Yet he continually resorts to blaming unsupported appraisals and fraudulent appraisers. It is no wonder he JT are such close friends.

If I have misinterpreted his position after reading many posts, then I stand corrected.

Let me set the record straight about a few things. I never worked for Fannie Mae but did work for Freddie for 2 years after the real estate bubble burst. I also do not blame appraisers for the real estate bubble, which, in my opinion was a credit bubble that was caused mainly by lax lending standards, including the extension of credit to anyone with a pulse without verifying whether or not they even had the ability to service the debt (i.e. liar's loans). Shady appraisal practices, driven mainly by a corrupt and ludicrous appraiser selection process that allowed loan officers and mortgage brokers to select the appraiser made the bubble marginally worse than it otherwise would have been, but certainly were not the cause of the bubble.

It is my job as the chief valuation officer of a secondary mortgage insurer to make sure that the mortgage loans that we insure are supported by sufficient collateral to secure the mortgage. Although the overwhelming majority of appraisals that are included in the loan packages that we receive are acceptable, we do find appraisals that are not adequately supported and/or are outright fraudulent. Anyone who thinks that there is not a problem with some appraisals being unsupported and a number of incompetent and fraudulent appraisers is living in a fantasy world.

Regarding JT, I do know her and I do agree with many of the positions she takes regarding appraisal and I also I do disagree with many of her positions, but so what? Nice attempt to smear me using guilt by association.

Why would any honest and competent appraiser have a problem with attempts to identify and weed out those who provide unsupported and/or fraudulent appraisals?

 

[timd354]

"continue to wallow in your own ignorance"
and this is not the first "ignorant" comment you have made my way.

"continue to wallow in your own ignorance"
and this is not the first "ignorant" comment you have made my way.

"continue to wallow in your own ignorance"
and this is not the first "ignorant" comment you have made my way.

It seems like you have a reading comprehension problem because my statement does not call you or anyone else a name, but is a nothing more than a description of behavior.

 

[timd354]

Regarding the CU SF example:

Q:
Would CU base what it determines to be "the correct GLA adjustments" based upon data provided by recently obtained appraisals or by some other data source which is not appraisal based?

CU uses the property record data collected through the UCDP as its primary data source.

 

[timd354]

Let me set the record straight about a few things. I never worked for Fannie Mae but did work for Freddie for 2 years after the real estate bubble burst. I also do not blame appraisers for the real estate bubble, which, in my opinion was a credit bubble that was caused mainly by lax lending standards, including the extension of credit to anyone with a pulse without verifying whether or not they even had the ability to service the debt (i.e. liar's loans). Shady appraisal practices, driven mainly by a corrupt and ludicrous appraiser selection process that allowed loan officers and mortgage brokers to select the appraiser made the bubble marginally worse than it otherwise would have been, but certainly were not the cause of the bubble.

It is my job as the chief valuation officer of a secondary mortgage insurer to make sure that the mortgage loans that we insure are supported by sufficient collateral to secure the mortgage. Although the overwhelming majority of appraisals that are included in the loan packages that we receive are acceptable, we do find appraisals that are not adequately supported and/or are outright fraudulent. Anyone who thinks that there is not a problem with some appraisals being unsupported and a not insignificant number of incompetent and fraudulent appraisers is living in a fantasy world.

Regarding JT, I do know her and I do agree with many of the positions she takes regarding appraisal and I also I do disagree with many of her positions, but so what? Nice attempt to smear me using guilt by association.

Why would any honest and competent appraiser have a problem with attempts to identify and weed out those who provide unsupported and/or fraudulent appraisals?

 

[djd09]

maybe my "wallowing in my own ignorance" is a reflection of the leaders

 

[Deleted member 80407]

In regards to OP post ~ CU & additional sales.
Fannie Mae has been utilizing the CU for minimally 2 years. If an appraiser is not receiving stips, it is because they are producing a creditable report. I do believe it is necessary write a more descriptive report and not an appraisal report filled with "CANNED STATEMENTS". My belief is that even if Fannie Mae does find additional sales, if your report has enough support, the stips will not be forwarded to the appraiser.

SUGGESTIONS:
**Present your search filters as well as the comp's considered for comparison. Even if Fannie finds additional sales and the sales are outside of the your search filter's, the reviewer should pick this up and eliminate a stip (see below thumbnail).


Present the neighborhood map showing the comp's considered for comparison as additional data. I utilize a picture page showing the market area considered for comparison (see thumbnail). If a stip comes back with additional comp's and they are located outside of the defined area, it will only require an explanation.

 

[Peter LeQuire]

Memory check: I've done enough reviews over the past 20 years to know that appraisers have been manipulating their appraisals to fit secondary mortgage market guidelines for at least that many years. It was going on long before there were appraisal management companies, so it is not really appropriate to "blame" appraisals being driven to fit into "FNMA guidelines" on the AMC review process. I've remarked in this august forum that I looked at many, many appraisals in which "reconciliation" simply was the recitation of how adjustments - line, gross and net, distance - did or did not conform to "guidelines": and when those adjustments did not, the analysis was nothing more than a statement to the effect that the variance "...is OK because there were no better comps more similar...".

 

[ucbruin]

CU uses the property record data collected through the UCDP as its primary data source.

Since appraisals have been transmitted via UCDP and the data reflects past $/adjustment practices (and if current appraisals keep employing the same $/adjustment practices) wouldn't it be almost impossible to receive flags based upon adjustments that aren't outliers?

Am I incorrect to be of the opinion that the majority of CU flags will be generated not because of $/adjustments but rather by physical characteristics of the subject and comps as provided by public records/assessor/MLS/etc.?

At least for the foreseeable future.