Abolish TAF?

[chad hampton]

I haven’t made a market condition adjustment in two years because my markets been stable. But there’s published data in every metropolitan area regarding what property values are doing. If an appraiser was doing appraisals back in 2021and not saying values were increasing, how did they make it through review? Why were they not told - Hey, we show that your market is increasing, but you’re not making any adjustments?

Or did they just continue to get rubber stamped by the AMC because they were the cheapest appraiser they could find?

I mean, damn, these guys are taking 40 to 60% of the fee at this point. Perhaps they need to have a little responsibility in the process. It can’t just be all about getting those investors paid.

Maybe that’s the system that has failed?

 

[DWiley]

Dunno', but the talking point landed him a spot in front of the Federal Reserve Board.

Fair point. On balance, do you think that telling the FRB that 90% of appraisers don't do their job correctly was a good thing for appraisers?

 

[chad hampton]

I think a lot of appraisers got used to not putting market condition adjustments because for two decades, no lender would accept them. After you’ve had something drilled into your brain for 20 years, it takes a little while to change it.

But I don’t think he did appraisers any favors. That would be pretty down on the list of things I would be talking to any sort of regulatory board about.

 

[George Hatch]

Dunno', but the talking point landed him a spot in front of the Federal Reserve Board.

I strongly doubt that market conditions adjustments or any other factor of how appraisals are supposed to be performed are among the talking points that brought him in front of the FRB. If you haven't looked at his company's website and read some of that commentary then you might consider looking at it.

 

[djd09]

i would abolish taf paying partners...AMCs...and the gse's preprinted forms

 

[Terrel L. Shields]

What governmental entity has the power to "abolish" such an entity?

TAF was created to serve a government purpose, right? Without TAF there would be no uniform regulation of appraisers if the system we have now can be called "uniform."

90% of appraisers don't make time adjustments

To me, most "time adjustments" are based upon inadequate data. The fact 2 properties sold for different prices on different dates is not an indication of the necessity for a "time adjustment" (market conditions.) The motivations of buyers and sellers is far more important. Most changes in price are related to the scale of the period in question. We can determine the change in prices over a year or five years far better than 10 days or even a month to month change. Real estate is an inefficient market and as such is not a smooth linear scale. It has a margin of error (actually just a variable deviation dependent upon supply, demand, financing, and the negotiating skills and urgency of buyers and sellers. It is not a uniform efficient market like wheat or gold where prices are readily discoverable in open trading.

 

[djd09]

His "proof" of that failure is noting that 90% of appraisers don't make time adjustments. Is that proof of what he asserts?

If appraisers don't do market analysis and don't make time adjustments, how is that the fault of anyone other than the appraisers doing the work?

do the mortgage brokers make any adjustments when waiving the appraisal...

 

[George Hatch]

TAF was created to serve a government purpose, right? Without TAF there would be no uniform regulation of appraisers if the system we have now can be called "uniform."

That "was created" is a passive way of explaining it. The appraisal orgs of the day created TAF, same as when they amalgamated their previously existing codes of conduct into a "uniform" standard and amalgamated their previously existing qualifications criteria into a single set of criteria. More editing than original writing or original thinking in either activity.

The govt was aiming at licensing. Somebody was going to have to formulate those requirements prior to legislating compliance. And for whatever reason the govt decided not to task the Westboro Baptist Church or the Boy Scouts of America or Enron or Cosmopolitan magazine to do that work. Go figure.

As for

TAF was created to serve a government purpose, right? Without TAF there would be no uniform regulation of appraisers if the system we have now can be called "uniform."

C'mon now. Within the context of the govt's known intent to license appraisers and regulate their conduct, that sentence doesn't even make sense. Of course it would be something whether it was appraisal-competent or not.

 

[Non Sequitur]

Fair point. On balance, do you think that telling the FRB that 90% of appraisers don't do their job correctly was a good thing for appraisers?

Nooooo! And per my OP, I don't agree with everything he says.

But while we're discussing what may or may not be a good thing for appraisers, cutting checks to the DC appraisal regulator alphabet soup definitely is not a good thing either. And IMO is more of a problem than his talking point.

 

[George Hatch]

I cut checks to my state regulator every 2 years, and those checks amount to a helluva lot more that $25/yr.

No matter what structures or labels comes next:

- the applications resulting from the fundamental concept and principles as currently elaborated upon in the ETHICS RULE and the COMPETENCY RULE will continue to be integral to the role of the appraiser​

- becoming qualified to act in that role will still require exposure and probably testing on the material​

- the enforcement of those requirements will still be delegated to at least one entity vested with the jurisdiction and the authority to act in that administrative role.​

And there will be appraisers who make it a point to learn those (new) rules of play as well as those who will never learn those rules of play and will defer to the form to drive the appraisal process instead of the other way around. Not much different than what we're seeing with the transition to the new UAD. Some appraisers will, some won't.