Where Do You Think "geographic Competency" Begins And Ends?

[Michigan CG]

That attitude was prevalent in the mid-1980's and is prevalent now. Everybody in the transaction KNOWS the value ... the appraisal is there just to check the regulatory box as far as most clients are concerned ...

The respect from private party clients is ten times that of lender clients.

 

[timd354]

The respect from private party clients is ten times that of lender clients.

While that is true for some private party clients, there are plenty of private party clients out there that want and expect appraisers to act as advocates for them and are not at all happy with honest appraisers who refuse to do that.

 

[Joe Flacco]

That attitude was prevalent in the mid-1980's and is prevalent now. Everybody in the transaction KNOWS the value ... the appraisal is there just to check the regulatory box as far as most clients are concerned ...

Yeah. Public trust needed to be preserved to the point where society chooses appraisals. But we failed to do that.

 

[PL1957]

Yeah. Public trust needed to be preserved to the point where society chooses appraisals. But we failed to do that.

It was a stacked deck where we had zero chance to win ... licensing came in and every warm body that could fog a mirror got grandfathered in ... puppy mills produced tons of ill trained, ill educated "professionals" who were convinced they were "good" appraisers because they hit every number a client was looking for - and the client agreed.

 

[Joe Flacco]

It was a stacked deck where we had zero chance to win ... licensing came in and every warm body that could fog a mirror got grandfathered in ... puppy mills produced tons of ill trained, ill educated "professionals" who were convinced they were "good" appraisers because they hit every number a client was looking for - and the client agreed.

That's what I have been saying. Qualifying standards should have been much higher from the very beginning of licensing.

 

[George Hatch]

Well, the good news in this is that even the individual can look out for themselves and protect their own personal reputation. And the *external* benchmark they can point to for their users to measure their performance is available.

Back in the day, disputes between appraisers frequently came down to status. The veteran was right by dint of their experience, not because they actually understood the fundamentals. The reviewer was right because of their job title, not because they had the stellar defense for their opinion. the Chief appraiser was right because they were the Chief Appraiser (and married to the CEOs daughter), not because they were that well informed. We can refer to that as the appeal to authority rather than the appeal to reason.

Whether people see it or not, having the uniform standard that is beyond the reach of both the reviewer and the Chief Appraiser levels the playing field by holding them to the same standard as everyone else. That's huge. Its effects almost can't be overstated, and most people don't even see it because they weren't around to see the "before". If you want to know why the myth of "there's no such thing as a good appraisal exists" that sentiment traces directly back to the no-mans-land that effectively existed in large swaths of this business prior to the promulgation of a single appraisal standard for everyone no matter who they are.

 

[J Grant]

This thread has gone into many interesting directions- I've experienced respect and regard from a number of clients ,, experienced abusive clients, and with advent of AMCs the indifference of a client that sees me as a vendor - .

Appraisers in lender/bank ( and some other forms of work) have an odd relationship with the client which can be adversarial. Due to regulations and USPAP, we are not engaged to reach the result ( needed value or other outcome ) a client might want. Whereas in most businesses, a client hires a professional to achieve a desired result, and professional strives to produce that result. .

This dichotomy puts pressure on client/appraiser relationships.. Some appraisers can't handle this pressure and tweak report results because of it. There are various levels of honesty among both appraisers and among clients.

For lender work, the system has failed to insulate appraisers adequately for independence and a way to work that does put public trust foremost. Though some rail against "protection", any fee issues aside, for GSE tax payer work, appraisers need "protection" to fulfill the public trust if that is what is intended. The patchwork of ever changing and poorly enforced regulations has not provided it.

Regarding the original topic of geo competence, whatever anyone's motives or business interests, how could geo competence / idea of expanding to wider areas for res lender appraisal work be about anything over than desk/hybrid work? Because if appraisers themselves do the property inspection, it makes no sense from a time /efficiency standpoint for appraisers to drive 200 miles for an assignment rather than 50 miles, and no sense to appraise in areas they are unfamiliar with since they have to devote additional time learning enough about it for competence.

Having appraisers work in areas they are familiar with, however large or small that may be , logically promotes a sense for public trust.. The concern of nearly every party I interact with , buyers and sellers and the agents that represent them, is if I know the area/how long I've appraised there. It opens the door to doubt and distrust if the appraiser, who is supposed to be the expert, knows squat about the area and has never been anywhere near it.

 

[Meandering]

Moody’s: Appraisal alternatives pose new credit risks
Could weaken credit quality of new RMBS
February 20, 2018

Kelsey Ramírez

Oh my, looks like investors have some concern about competency, and all the other faster and cheaper, supposed "tech" some folks want to advance.

That's a real shame, because I heard the stock pundits expecting banking stocks to go up, yeah, but maybe not when these types of valuations start to catch the eyes of investors and the public.




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[timd354]

Moody’s: Appraisal alternatives pose new credit risks
Could weaken credit quality of new RMBS
February 20, 2018

Kelsey Ramírez

Oh my, looks like investors have some concern about competency, and all the other faster and cheaper, supposed "tech" some folks want to advance.

That's a real shame, because I heard the stock pundits expecting banking stocks to go up, yeah, but maybe not when these types of valuations start to catch the eyes of investors and the public.




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Moody's rates MBS's and they should do their due diligence and analyze what effect, if any, the use of PIW's, Bifurcated Appraisals, and other appraisal alternatives have on the performance of the loans that secure these assets. I have no doubt that the Moody's and the other rating agencies will obtain the data that shows how such loans perform from the GSE's and other issuers of MBS's and their analysis of that data will factor into their ratings of the MBS's issued by the GSE's. Moody's official announcement on the matter also acknowledges that there may be mitigants for the perceived additional risk due to the use of alternative valuations and that there may even be decreased risks due to the use of alternative valuation products in some scenarios.

Unlike, the emotional knee-jerk reactions regarding such products among some appraisers, the data regarding loan performance are going to tell the objective story of how so-called alternative valuations perform versus so-called traditional appraisals.

I say let the chips fall were they may....the loan performance data will tell the story

For anyone who wants to look at the actual announcement issued by Moody's, it can be found here: https://www.moodys.com/research/Moo...al-alternatives-a-potential-credit--PR_379680

 

[Meandering]

Oh please,

When the market goes belly up and the loans default, of course the whole reason those loans went into default was because of the appraisal. Learn nothing in a decade???

Maybe JT will be able to open a dark circle around her clearbox, to vet those "inspectors".

And seeing as how these "products" have been around for a "long time", how do you call appraisers the knee jerkers??? Most appraisers I talk to decided long ago this wasn't something they wanted to do. It's the AMCs knee jerking trying to lie their way into appraiser's confidence to do them.

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Try and keep your little stories straight, with your buddies on your side of the, just do them, and be the only one holding liability for a little more than a $100, side of the issue.



Did you ever work it out with George, to whom the Truth in Lending Act pertains? Or should I copy and past some of it tomorrow?

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