54 Page Residential Appraisal Report

[Peter LeQuire]

If the GSE people don't care about appraisers' E&O, why do the firms to which they have offloaded the task of managing the appraisal control process - including, in many instances, the determination that appraisals do or do not conform to the GSEs' and clients' requirements? (Unless you think I was referring only to employees of FNMA and FHLMC - "GSE people" inludes those who sell their product to the GSE, and by reasonable extension, those who originate product that can be shelved for later sale to the GSEs or securitized into financial instruments that can be marketed as being in conformity with GSE requirements.

 

[timd354]

If the GSE people don't care about appraisers' E&O, why do the firms to which they have offloaded the task of managing the appraisal control process - including, in many instances, the determination that appraisals do or do not conform to the GSEs' and clients' requirements? (Unless you think I was referring only to employees of FNMA and FHLMC - "GSE people" inludes those who sell their product to the GSE, and by reasonable extension, those who originate product that can be shelved for later sale to the GSEs or securitized into financial instruments that can be marketed as being in conformity with GSE requirements.

When you referred to GSE people, I thought that you were referring to the GSE's and/or their employees...to me that would be the common and most obvious interpretation of that you meant. You apparently meant not only the GSE's but their seller/servicers too, which really was not apparent from your prior statement.

 

[Peter LeQuire]

I apologize for my lack of clarity. I'll try to remember to be more clear going forward. But, I am very much aware that lenders, their AMCs and the staffs of each show different levels of training and of understanding what the GSE requirements actually are, conflate them, and require documentation in anticipation of meeting any objection to a particular loan's lack of documentation.

I compare them to Ed "Too Tall" Jones who once described his defensive technique as simply grabbing as many of the other team as he could and "shucking" them off till he got to the one with the ball.

 

[George Hatch]

The Fannie formats themselves add pages. Putting overflow on addenda frequently leads to repeating things there that are also said in the main body of the report. Packing the boilerplates with housekeeping elements that are intended to satisfy all of the appraiser's users instead of just the one they're aiming this report at adds to length.

Look at the AI forms. Their SFR form is 8 pages and their cert/limiting conditions addenda is 2 pages. So that's 10 pages on letter sized format, inclusive of 1 page for the Income Approach and 2 pages for the Cost Approach, neither of which are developed in many SFR assignments. Meaning, they would often get left blank if they were included at all.

If you dropped the Income Approach page and added an extra comps page and an additional text page to handle the narrative portions of the Sales Comparison that would amount to 11 pages. Add one more page for the market segment analysis and 1004mc that should *preface* the Sales Comparison and that's 12 pages.

Compared to a GSE version of the same appraisal 6 pages of URAR, 1 extra comps page and one 1004mc page and another narrative page for SOW and other commentary and that's 9 pages, with several fields being too small to accommodate even a cursory summary. The difference is that you can readily fit everything or almost everything you need to say in a standard SFR assignment in the fields the AI forms provide without having any overflow. So that enables the reader to read your report from front-to-back - which is huge from the reader standpoint even if it doesn't necessarily save the appraiser any writing time.

I'm not saying the AI forms are perfect - they're aimed at a much wider potential usage than the GSE forms. As well, I'd want to break the "neighborhood" and site sections page into separate pages and add fields for exposure time analysis and the like that are relevant to market value opinions.

The point that we've made many times over the years is that if we know that a certain percentage of appraisers will always allow the form to drive the process instead of the other way around then it behooves us to enable them to at least do so with a form that hits all the high points as a default instead of as an opt-in choice. Better forms will tend to produce better results from the form monkeys.

 

[residentialguy]

You need at least 3-4 pages of comments to de-bastardize and clarify the UAD URAR and FNMA's contradictory instructions, not to mention the CYA's

 

[Terrel L. Shields]

I knew an appraiser who once was on this forum. He left when he got one too many complains. Until then he had beat them all back. The MAI who reviewed him frankly was an idiot most of us who had encountered him thought as...affable but idiot. Every report he reviewed apparently needed to arise to the level of an MAI demonstration report.

I actually used the appraiser exforumite to do two houses in Little Rock that was part of a much larger estate I was appraising. He had a very concise report, to the point, and it lacked cover letters, extra photos, etc. I think it was about 12 pages total...one page non-lender form, etc. Nice work. Got to the point, credible but verbose? No. It was exactly what I think is a summary report. The very kind of report that imho meets USPAP with no problem. The problem lies with bad underwriting and demands for details that were not part of what I considered to be adequate under the old "Summary" report. The problem is our masters want more and more in hopes of deflecting criticism away from them and blame upon someone else.

 

[DWiley]

The content I puzzle over is the stuff that is totally unnecessary. I saw a report a few days ago that had the definition of Market Value in three places. The prior service disclosure was in multiple places. etc etc. Things like that just set up the possibility to have conflicting information, and they add unnecessary length to a report.

 

[Deleted member 130081]

How about a 3 page report. Subject identification, market evidence and conclusions on page 1, photos on page 2, certs on page 3. 54 pages is ridiculous for a couple hundred bucks. No other work sector allows themselves to be taken advantage of the way appraisers do.

 

[Don Clark]

How about a 3 page report. Subject identification, market evidence and conclusions on page 1, photos on page 2, certs on page 3. 54 pages is ridiculous for a couple hundred bucks. No other work sector allows themselves to be taken advantage of the way appraisers do.

That would preclude a sketch, UAD requirements, a map, and enough detail to comprise a USPAP and a UAD compliant report unless it is a desk top appraisal report. And, when all is said and done, it is the appraiser, based on the scope of work and client requirements that will dictate the amount of analysis and what goes into a report. For me that is usually less than 20 pages.

 

[Deleted member 130081]

That would preclude a sketch, UAD requirements, a map, and enough detail to comprise a USPAP and a UAD compliant report unless it is a desk top appraisal report. And, when all is said and done, it is the appraiser, based on the scope of work and client requirements that will dictate the amount of analysis and what goes into a report. For me that is usually less than 20 pages.

Exactly. So I say again, how about a 3 page report. Please explain what a map has to do with anything other than an additional document request on the part of the client. At some point, it would be nice if appraisers could differentiate between what is essential to an appraisal report and what is additional per client request and stop confusing requests as requirements. Even better, start charging for assignment conditions that exceed minimum requirements.