hastalavista
Elite Member
- Joined
- May 16, 2005
- Professional Status
- Certified General Appraiser
- State
- California
(my bold)
This is, in my opinion, a real dilemma and what burns most of our britches.
One would think that prior to anyone sending me additional sales to consider, they would be vetted at some level. Personally, I believe that is what occurs most of the time (always exceptions). I can personally attest to seeing requests to look at additional data coming to the lender, and the lender saying, "No, these are not relevant. We don't think they warrant a look by the appraiser."
In the ideal world, someone at the bank/AMC with a higher level of expertise would vet the sales as well. That does happen at some lenders/clients, but not all.
And, let's state as a given that many requests are not vetted at all and should never have been sent to the appraiser. That's not how the system is supposed to work and those that automatically send data to appraisers are screwing everyone because with enough of that activity, appraisers (rightfully so) are going to resist any ROV.
Here is where I see the biggest problem: It is when the lender/AMC gets a request that it simply cannot make a call on its relevancy. Some, most, or perhaps all of the data provided might be worth considering, but they do not have the property or local expertise to rule it in or out. So, what they do is send it to the appraiser (the local expert) and ask for her or his opinion.
When the local appraiser gets it, they scratch their head and wonder, "Why the hell are they sending me this???" because to the local appraiser, there it is crystal clear why the data isn't relevant or warrant any change to the original appraisal.
We expect the client to be able to know our market well enough to determine if the data is relevant or not. But, sometimes, they don't. And I'm not certain they should be expected to.
As a reviewer, when I read a report and not understand something that may be material, I'll call or email the appraiser and ask the question. Many times, the appraiser's explanation of what is in the report satisfies me over the phone or the email, but without confirming it with the appraiser, I cannot make that judgment on my own. Depending on the situation, I may ask the appraiser to include that explanation in the report or I'll tell the appraiser don't change anything, I'll just recount the conversation in my review and note that the conversation addressed the issue and all is well.
The ideal ROV scenario (IMO) is similar to my example above. Whomever is making the decision to forward the data or not to the appraiser has considered what that data is and has tried to make a determination if it raises questions which are best addressed by the appraiser. In my example, I may think I know the answer, but I'm not certain that my answer is the original report's answer. So I have to confirm it so I can complete my review and provide my opinion of the quality of the report.
In the ROV with new sales, the lender/AMC should look at them and determine if they are reasonable or not; and if they are, are they any better than the ones that are in the report. I expect the lender to make a determination of the reasonableness in most cases (plain vanilla deals; if I have a more unique property, then the question of reasonableness might have a wider range of characteristics. For sure, if the best comps I've used have a lot of adjustments for differences, other sales with similar differences may appear reasonable to the client). I'd like it if the client could then make a judgment if they are reasonable, are they any better than the ones in the grid? I'd like that, but that may be asking too much. I think it is reasonable for the client to say,
"Gee, given everything, these look like reasonable sales to consider: Did you consider them/should you consider them, and if you do consider them, does it change anything?"
As long as enough clients/AMCs push-through ROVs en masse, then I don't expect appraisers, in general, to be that receptive to an ROV request. And that is damaging (IMO).
For clients that do a reasonable job at filtering the ROVs first, then I would expect appraisers, in general, to be more receptive to an ROV request.
All the client has to do to me is persuade me that it really does have a reasonable question which could affect my appraisal. When they do, I'll address it. When they don't, I'll grow to resent it.
