2003 USPAP

[Jo Ann Meyer Stratton]

We have been having several lively discussions under various headings regarding updates, recertifications, listings, etc, etc. So I have decided to post a link to the Appraisal Foundation site for the "Appraisal Standards Board Summary of Actions, June 11, 2002". This the the changes that will go into effect 01/01/2003 in USPAP which will require a three year history for the subject (including ALL agreements of sale, options or listings) and changes to AO-3 and SMT-7 regarding Updating an Appraisal. The Summary is 13 pages long--but the important stuff is in pages 1 through 4. So read, study and think!

http://www.appraisalfoundation.org/html/pd...ryofactions.pdf

If my link doesn't work--go to http://www.appraisalfoundation.org

and look for the link on the left hand side of screen to the Appraisal Standards Board Summary of Actions, June 11, 2002.

Real Property Qualification Criteria will be decided at their public meeting in Washington, DC October 18, 2002. That is where they will discuss college degrees. Check the foundation website for that info.

 

[jtrotta]

JoAnn

thanks and the first link worked well - should get very interesting next year; again it is noted that these changes are for the Benefit of the Public - whats being done regarding misrepresentation via AVM's :?:

It has been brought to my attention by several various professionals, that our business is being attempted to be "eliminated" - if that happens who will be watching over the industry for the best interest of the "Public" :?:


8)

 

[Austin]

I just read pages 1-4, now here is what I kept axing myself: We have all of these USPAP rules with 33% of the students at the USPAP instructors class flunking the test because they can’t understand the rules, so how are the rest of us suppose to understand them. We have enforcement of USPAP rules by state appraisal boards that have no training in USPAP and who acquired their office by buying it with campaign contributions and who have exempted themselves from continuing education insuring they will never become qualified to enforce USPAP. We call these standards of professional appraisal practice “Uniform” and have a system in place that results in 56 different interpretations plus 56 sets of additional rules all for the purpose of protecting the same national banking system. We have state appraisal boards acting like some eastern European police state Gestapo who shows no regard for due process or legal rights. All of this to enforce appraisal methods and practices of which there is no legally recognized body of knowledge and if you will read the comments under standard 1-1A can range from any method from astrology to Tara card reading. Then the only sane method to police this practice is by using standard 3 reviews to prove a pattern of wrong answers but do not require standard 3 reviews before questioning price estimates because the state appraisal boards don't have the funds to exercise due process or respect legal rights.
We have the FNMA form programmed wrong in every forms program because it does not reflect the proper sequence of adjustments, then we attempt to answer the question asked in the definition of market value “most probable price” with a method that is mathematically impossible to do so. Then we are going to solve all of these problems with a three-year sale history and more and better reconciliation? I have spent time in insane asylums that were more rational that this!

 

[Steve Owen]

Good link Jo Ann, thanks. What surprised me was how little (apparently) things are going to change in 2003. I have been on other threads in this forum, where supposedly knowledgeable people have been quoting the mantra "this changes everything." Seems to me like the old basic principles are still intact.

 

[Jo Ann Meyer Stratton]

Yes, basically the change is to the three year history for residential properties. And an attempt to clarify the update question. But an update to an appraisal or an updated appraisal has always been a new assignment that referenced a previous assignment, so in a way that really isn't much of a change--just a change in words. And the difference between the words update and recertification that occurred in the 1995 USPAP did make sense when you think through what those words mean. It took me about three years beginning in late 1994 to understand the difference--and it seems a lot of appraisers still don't. But when you think about the word recertify--you are certifying that yes you did do something in the past. So if you are doing someing today--you are not recertifying. You are updating when you consider something today in the context of an extension of a previous assignment.

The future will be changing for appraisers entering the profession due to the proposed educational requirements.

But every appraiser needs to become aware that USPAP is changing and start making plans to attend a USPAP seminar taught by an instructor certified by the Appraisal Foundation as soon as possible after 01/01/2003. In the mean time they can read the link I posted and be ready for 01/01/03.

 

[Steve Owen]

Jo Ann, interestingly enough, the changes (if I am understanding them correctly) will not cause me to alter my practice one bit. From a lengthy conversation I had recently in another thread, I would have believed that the world was going to turn upside down in 2003.

I already research past sales history as far back as I can go, which in my area is about ten years. I have always considered that USPAP requirement to be just what it says it is - a minimum. Doing the additional research only takes a few minutes and it gives me a constant feel for any need for market conditions adjustment. It also stops those re-fi's cold when a home owner wants his house to worth way more than than market appreciation on what he paid six years ago (and hasn't done any updating).

 

[Pamela Crowley (Florida)]

I have always considered that USPAP requirement to be just what it says it is - a minimum.

Hear, hear!