We're Back To The Beginning

[TRESinc]

Difference? lobbyists for the insurance industries would strike out and be all over (and fast to quelch) any issues that could be construed to be against or affect the public’s interests. Thus far their (value added) roles and services protecting the public’s financial and legal interests haven’t been challenged or questioned.

i don't agree with what you posted (not with the post by OI).

i think it is due in large part to the public's perceived abilities. anyone who owns a home "knows" what it is worth and has a plethora of data at their fingertips anytime they want. the reliability of that data (zillow, trulia, redfin, etc) may not be great but that won't stop the public from using it. compare that to insurance. typically people have no clue what it means to insure something past the fact that a company may have to pay a person for a loss of some kind after a policy has been bought.

if you took 100 people and asked them:

a. what do you think it would cost to buy this house?

and

b. what would you need to do to find out if there are any liens, easements or issues with the title to that house and insure the title?

100 people would spit out a number to answer A. no one would have a clue how to come up with a number for B. people are more familiar with appraisals than title searches so it's easier to dismiss what we do.

 

[J Grant]

Lots of differences with insurance or title to appraisals.

People loathe paying insurance and would rather not pay it if given the choice ( some who own property with no mtge do drop insurance ). But lenders require insurance and it is a safeguard against damages. Its purpose is completely different than appraisals and an appraisal is a one time charge, whereas insurance continues for life of loan ( or when loan is paid off, as long as a HO wants to pay for it )

Title is a legal requirement for most states/deeds/ recording etc. Whether title searches or aspects of title work are more automated now compared to before idk.

Appraisers may want to pay attention to the fact that HELOC / other loan uses used to be green lighted using only an AVM, apparently that was deficient on some level so the regulation recent years changed to requiring at least an evaluation with ext inspecton and these are more and more being sent to appraisers as a desktop appraisal, so the fact that an AVM or AI can spit out a value still is not a threat to replace appraisals...yet...though Fannie thinks its own proprietary AVM/data for certain properties is reliable enough combined with strong borrower financials for appraisal waiver for a segment ( so far smaller ) of loans...but even they need an appraisal on record done within past X years.

 

[Terrel L. Shields]

OCC recognizes the concern that depressed housing values in certain distressed communities in the United States may inhibit mortgage lending

Depressed values are the result of depressed market factors and pumping them up invites a crash, there is nothing to be concerned about. Let the market work.

None of the above bode well for volume or fees

Quantity has a quality of its own, supposedly attributed to Lenin's description of his large but under equipped Army. Turned out to be cannon fodder and little more.

If shorted on fee, the appraiser can only respond with lower quality work, and that in turn, invites even more competition. As Phil Crawford argues, you end up with the "appraisers" making very little money sitting in a cubicle and doing desktops all day.... the analogy by Kevin being the licensed broadcaster going from $80k per year income to minimum wages upon "deregulation"...welcome to radio.

 

[djd09]

Depressed values are the result of depressed market factors and pumping them up invites a crash, there is nothing to be concerned about. Let the market work.

Cleveland hasn't even recovered from the last time they were passing out gin flavored loans. Only if Rockefeller could see now.

 

[Eli]

I feel a tidal wave coming.

 

[Rick Stillman]

We are not "back to the beginning", this is a more complex time with new challenges than in prior appraisal decades.

Appraisers used to work for lenders directly. Then after the meltdown of the 90's the powers that be decided that appraisers must be independent and beyond any influence from lender's vested interests.

Now, the big AMCs are merging with the smaller AMCs and it is becoming a monopoly market. And WAY too many of the big AMCs want total control of appraisers. Staff. How's that working out for being independent and impartial? Don't play stupid and make me laugh. We all know the answer to that. It's like having USDA food inspectors being hired by the companies directly that they're supposed to be inspecting. And they're going to be impartial and do their job properly. Sure. You bet. Wanna buy a bridge? The lenders, time and time again, don't even follow the rules that they are bound to - and they make the news and pay a big fine. Do you think they are going to care one whit about appraisers being impartial and following rules? USPAP what? Credible and supported what? Just give me the NUMBER and it better be the right number!

So once again, appraisers are under the control of the interested party with a vested interest in making the loan work.

Yes, things are more complex, but this sure sounds like it has come full circle back to the beginning to me.

And the regulators and bank reviewers see nothing wrong with this situation. This is so funny and sickening at the same time. And not even seasoned appraisers HERE can see this cycle for what it is. How can we hope that anyone else could see it then?

We get what we deserve because we the people won't stand up for effective and honest leadership in this country, so everyone serves their own best interests. Period.

 

[George Hatch]

Appraisers used to work for lenders directly. Then after the meltdown of the 90's the powers that be decided that appraisers must be independent and beyond any influence from lender's vested interests.

Now, the big AMCs are merging with the smaller AMCs and it is becoming a monopoly market. And WAY too many of the big AMCs want total control of appraisers. Staff. How's that working out for being independent and impartial? Don't play stupid and make me laugh. We all know the answer to that. It's like having USDA food inspectors being hired by the companies directly that they're supposed to be inspecting. And they're going to be impartial and do their job properly. Sure. You bet. Wanna buy a bridge? The lenders, time and time again, don't even follow the rules that they are bound to - and they make the news and pay a big fine. Do you think they are going to care one whit about appraisers being impartial and following rules? USPAP what? Credible and supported what? Just give me the NUMBER and it better be the right number!

So once again, appraisers are under the control of the interested party with a vested interest in making the loan work.

Yes, things are more complex, but this sure sounds like it has come full circle back to the beginning to me.

And the regulators and bank reviewers see nothing wrong with this situation. This is so funny and sickening at the same time. And not even seasoned appraisers HERE can see this cycle for what it is. How can we hope that anyone else could see it then?

We get what we deserve because we the people won't stand up for effective and honest leadership in this country, so everyone serves their own best interests. Period.

You've got it all twisted. No wonder you're unhappy. The MBs you worked for were not lenders. They were outside loan salesmen, working on commission. no different than the kid who knocks on your door selling magazine subscriptions - they are not "publishers".

The loan salesmen have no business even touching an appraisal or any other due diligence function that's used by the actual lender, except to hand the borrower's copy of the report to the borrower. What we do for the lenders is literally none of their business.

The fact that YOU can't see that and continually conflate the loan salesmen with the actual lenders isn't sickening nor is it funny. But it does warp your perspective, because despite all the evidence to the contrary you still seem to think what you or I want matters. It doesn't.

The actual lenders are not presumed to be so much better, but because they're now more directly responsible for the appraisal engagement they won't have anyone to blame for their decisions this time. In the event the gov't ever gets around to holding anyone accountable for their decisions.

 

[Rick Stillman]

You've got it all twisted. No wonder you're unhappy. The MBs you worked for were not lenders. They were outside loan salesmen, working on commission. no different than the kid who knocks on your door selling magazine subscriptions - they are not "publishers".

The loan salesmen have no business even touching an appraisal or any other due diligence function that's used by the actual lender, except to hand the borrower's copy of the report to the borrower. What we do for the lenders is literally none of their business.

The fact that YOU can't see that and continually conflate the loan salesmen with the actual lenders isn't sickening nor is it funny. But it does warp your perspective, because despite all the evidence to the contrary you still seem to think what you or I want matters. It doesn't.

The actual lenders are not presumed to be so much better, but because they're now more directly responsible for the appraisal engagement they won't have anyone to blame for their decisions this time. In the event the gov't ever gets around to holding anyone accountable for their decisions.

I did not say the MBs I worked for. I said the lenders that had their own in house STAFF appraisers. If I remember correctly, you once had that position George. That was par for the course in the 90s. There was no schooling - no licensing - and certainly no independence. You learned the job by working for the bank/lender that you were employed with. THAT'S what I am referencing.

 

[bnmappraisal]

I have shared multiple times how to get fees higher than C and R, some people don't want to put the work in.

though worth repeating and (my bold) ... it does take work

 

[bnmappraisal]

I did a review earlier this year and misread it as a DESKTOP review when I got the assignment. Turns out it was a standard review and took a lot more time than I wanted it to but I accepted it without really reading what they wanted. My bad. I did the review of the absolutely horrible report and in the notes to the lender I told them the fee was absolutely too low for a report like this and that they needed to turn the report into the state. They responded to me, and I can't make this up "If the report was bad, we would have sent you a different one. This was just for compliance and we have to have X number of reports reviewed per year and the reports are picked randomly". That was their response. They did not care about quality one bit, just compliance.

This is pretty sad, but ... sadly, I'm not surprised to hear it