AMC asking for UAD 3.6 fees, what's everyone thinking?

[DWiley]

Tell me - when you were 'actively' appraising, did you really perform analysis to extract adjustments for 10' ceilings vs 8' ceilings? And before you say 'yes', be prepared to share how you extracted that data for the comparables...

I still have boxes of old reports in a storage barn at my parents' house, and if I were to pull out a field sketch from 20 years ago you would see that the ceiling height was noted in every room. I had codes I used so a nosy owner looking over my shoulder did not know what I was writing. I had codes for ceiling height, trim level, and flooring, and each room on the sketch had all 3 codes. I had similar codes for condition.

I was taught to do that early on, as it is an indicator of build quality. As for an adjustment, that info was used to help select comps with similar quality features in order to hopefully avoid such an adjustment. But, yes, I did occasionally have to make quality adjustments because of features like 10' ceilings. Data for the comps was taken from my analysis of the MLS listing and photos. Really not that difficult.

In the field we are looking at so many trees that sometimes the forest can be missed. I used my codes, in aggregate, to give me a more objective way to analyze the overall quality and condition. (e.g., hardwood flooring in 80% of the home, ceiling greater than 9' throughout, worn flooring in half the home, etc.)

 

[George Hatch]

I do that in my notes. Ceiling heights and floor coverings for every room. Kitchen and bath buildouts. Landscaping and hardscaping and topo for the site, driveways and alleys and direction of travel for the street.

 

[J Grant]

Doesn't matter if someone used to make a note about exact ceiling height vs saying volume ceilings. Either way, every appraisal is an enormous amount of labor and stress; this just introduces another layer of liability and inspection requirement.

Properties of all types are far more expensive now than 20-30 years ago, which means larger adjustments, more liability, more extensive renovations and features to take into account. Owners are far more picky because so much money is at stake.
There are stips and revision requests and layers of scrutiny now which were not present 20-30 years ago or even 10 years ago,

The arguments to undermine appraisers and discourage attempts to get higher fees have begun. Even though a higher fee barely makes up for the fact that current fees res lending fees lag far behind the inflation and cost of living index, as well as fees of other professionals or tradespeople.

 

[J Grant]

I do that in my notes. Ceiling heights and floor coverings for every room. Kitchen and bath buildouts. Landscaping and hardscaping and topo for the site, driveways and alleys and direction of travel for the street.

I make similar notes on the features you mention for my own use on properties. I assume other appraisers do as well. Having to enter this information in a rigid format and then have drop-down fields appear, prompting more info and adding a photo, exhibits each one in 3.6, adding more complexity and time.

Do you plan to fill a 3.6 form yourself at any point ?

 

[alebrewer]

I still have boxes of old reports in a storage barn at my parents' house, and if I were to pull out a field sketch from 20 years ago you would see that the ceiling height was noted in every room. I had codes I used so a nosy owner looking over my shoulder did not know what I was writing. I had codes for ceiling height, trim level, and flooring, and each room on the sketch had all 3 codes. I had similar codes for condition.

I was taught to do that early on, as it is an indicator of build quality. As for an adjustment, that info was used to help select comps with similar quality features in order to hopefully avoid such an adjustment. But, yes, I did occasionally have to make quality adjustments because of features like 10' ceilings. Data for the comps was taken from my analysis of the MLS listing and photos. Really not that difficult.

In the field we are looking at so many trees that sometimes the forest can be missed. I used my codes, in aggregate, to give me a more objective way to analyze the overall quality and condition. (e.g., hardwood flooring in 80% of the home, ceiling greater than 9' throughout, worn flooring in half the home, etc.)

Haha. Ok. Until recently, I wasn't aware of any method for accurately denoting ceiling height in crappy MLS photos, but if you say so. Remember, digital photography has only been around since the early 2000's. Careful - you'll back yourself into a corner.

 

[George Hatch]

Do you plan to fill a 3.6 form yourself at any point ?

Depends. If the money is right. I have always appraised SFRs. I never actually stopped. I just don't compete with the appraisers who service the GSE and related niches. I actually enjoy certain aspects of performing an SFR assignment.

I compared what I do with the 3.6 and have already been reporting most of those elements, so my thinking right now is that the learning curve for me would be operating the appraisalware. Not the data collection and reporting processes themselves.

THe challenge for me in transitioning back into the conventional pipelines and their clients has always been that it's hard to match the pace I use for my existing work with quicker pace expected by those clients for those assignments. I can't get much done on my regular work if I'm constantly on the run with the SFR assignments.

 

[Surf Cat]

..for the subject property. The problem identification phase of the assignment involves more detail.

Yeah..... so send out the Uber driver to get that. And, don't let the damn trainee whom went through all the appraiser courses even get close to the place!

 

[Mile High Trout]

UAD contains a far larger number of data fields. It is not a matter of simply counting pages, especially since 2.6 contains addendum pages. Clever..

Each data field can mean more details gathered at the inspection, more data to research, more info to chase down.

Just wing it and guess work. Nobody actually cares. And no one can prove anything about granular detail like number of windows or interior ceiling height.

Nobody is going to double check anything of that nature. They're not going to pay for that kind of additional verification service and field reviews don't get inside a home.

If they run some AI utility which questions or corrects, think of it like a free office assistant.

Nobody cares anymore. Appraisal quality is not even a priority for most companies engaging appraisers for gse work.

Literally nobody cares. You can not find lenders or AMC companies whom care about appraisal work quality anymore.

 

[alebrewer]

Literally nobody cares. You can not find lenders or AMC companies whom care about appraisal work quality anymore.

I think you're correct about this. And the reasons are at least twofold: (1) appraisal quality - overall - really is pretty crappy, and (2) the GSE's (who control ~ 55% of the entire residential mortgage market) have effectively killed what little demand there was for quality appraisals. By convincing MBS investors that their internal AVM is as accurate (if not more so) than an appraisal, they've accomplished the feat of convincing MBS buyers that appraisals aren't important.

 

[Surf Cat]

You can not find lenders or AMC companies whom care about appraisal work quality anymore.

I've been saying this for a long time.... why do appraisers continually have to keep going through the continuing education rigamarole when the users not only won't pay for, but don't care about the additional education and knowledge garnered?