Another ROV story

[Terrel L. Shields]

Twenty-seven sales and listings were considered. Four were selected for further analysis and are included in the appraisal report.' It works.

Saying that is nice... if you have 27 sales in the defined neighborhood. I would bet 90% of my assignments are lucky to have 5 sales, let alone 5 good similar sales that are recent. I have a MH assignment of 5 acres, poor condition, REO, and sales are 6, 18, and 8 miles away in 3 different directions in 3 different school districts. But like I said my reviewer lives in the county, not Indian, and knows there are not many sales.

 

[Mike Ault]

The ROV isn't a punishment. It's an attempt by the borrower, loan officer, realtor to complete a transaction.

Above market value, which every party in the transaction is typically well aware of.

 

[J Grant]

The ROV isn't a punishment. It's an attempt by the borrower, loan officer, realtor to complete a transaction.

The above stinks- let the BORROWER or REALTOR or LOAN OFFICER complete the transaction!! It is THEIR transaction, not ours.

We are giving an opinion of value. If a Realtor is involved, and the borrower is financing, the realtor should see if the borrower is willing to put their own cash down to make up the price gap if it does not appraise to SC price. And if there is a refinance, the loan officer can go for a different LTV%. Why the f*** is any of this our problem?

These people are trying to avoid putting more of their own $ down. Or a seller can take less. Maybe a homeowner can't use their home as a piggy bank if there isn't enough equity. They all want to avoid responsibility and make it the appraisers' problem.

Pressuring appraisers, including an ROV, to hit a value in order to complete a transaction - at least it's clear what the dog and pony show is about.

 

[J Grant]

Above market value, which every party in the transaction is typically well aware of.

A buyer is free to pay over an opinion of market value - all they need to do is put more of their own $ down. If they do not want to do that, it's their call.

But instead, the system is rigged to pressure the appraiser to overvalue- their competition is the GSE waiver/ value acceptance, and green lighting of hybrids for origination loans, which keeps the appraiser an anonymous ghost stuck at a desk while random non-appraisers go to "collect data" on the subject. What could go wrong.... (sarcasm intended).

Why is this shift to marginalize the appraiser happening? It is not to save the borrower money, as they love to claim. The borrower is paying thousands and tens of thousands of $ in loan fees and RE commissions - if they save $100 on a valuation, it is not going to matter.

This is happening for two reasons: 1) siphon as the $ valuation from the appraisers and put it into the hands of corporate-owned AMC's and software companies, and 2), if the profiteers can control the values, they can set prices and shape markets. I see it in my market - 40% or more of sale assignments now are to investors with a rental form needed, and nearly every property I research shows delinquent taxes, with more properties owned by an LLC or Corp than by an individual, RE agents and property flippers selling back and forth to each other. A different version of the 2006-2008 pre-crash game the system.

 

[sputnam]

Addressing six sales is time-consuming. It should stop at 3 or 4 sales. Of course, not allowing it at all would be better.

Not allowing it at all. So, you are of the opinion that every appraiser always gets it right every time? And there should be no mechanism for the Client to say.. "What about this?".?

 

[sputnam]

Saying that is nice... if you have 27 sales in the defined neighborhood. I would bet 90% of my assignments are lucky to have 5 sales, let alone 5 good similar sales that are recent. I have a MH assignment of 5 acres, poor condition, REO, and sales are 6, 18, and 8 miles away in 3 different directions in 3 different school districts. But like I said my reviewer lives in the county, not Indian, and knows there are not many sales.

You say whatever you actually do. My statement was an example.

 

[J Grant]

Not allowing it at all. So, you are of the opinion that every appraiser always gets it right every time? And there should be no mechanism for the Client to say.. "What about this?".?

WRT if folks suspect the appraiser did not get it right, they can ask for a review. A review is not an ROV.

Let the client pay for it if they want to ask what about this? But that is not what they are asking, we al know it.

The appraisers are doing a free ROV for the sake of parties trying to change the value to make a transaction work. You admitted it in your own post, where you said the parties want an ROV to try to close a transaction.

 

[Carnivore]

of course their adv0cates for borrower or seller and refi's has been going on since JC was a corporal

In our area we did limit ROV's to two tries from realtors

In this country no one garantees you a living. No but it does give you opportunity

The best defense is to get out in front of this by nailing a lot of nails into the coffin be for you submit the report
your one angry person.

Sorry but not sorry

 

[sputnam]

WRT if folks suspect the appraiser did not get it right, they can ask for a review. A review is not an ROV.

Let the client pay for it if they want to ask what about this? But that is not what they are asking, we al know it.

The appraisers are doing a free ROV for the sake of parties trying to change the value to make a transaction work. You admitted it in your own post, where you said the parties want an ROV to try to close a transaction.

Sure... they can get a review. That's how I earn most of my income. However, the regulations also allow for ROVs... and in some cases, appraisers are required to respond to ROVs. Personally, I would rather the Client say to me... 'You missed these really good comps." and give me the chance to respond. Your value is your opinion... Other people are allowed to have differing opinions and to ask you to reconsider and/or better support your opinion.

 

[J Grant]

Sure... they can get a review. That's how I earn most of my income. However, the regulations also allow for ROVs... and in some cases, appraisers are required to respond to ROVs. Personally, I would rather the Client say to me... 'You missed these really good comps." and give me the chance to respond. Your value is your opinion... Other people are allowed to have differing opinions and to ask you to reconsider and/or better support your opinion.

I am well aware that regulations allow an ROV and what a review is ... I have done hundreds of field reviews. A fewiew cost money, an ROV is free to a vested party trying to influence value to get their deal done. An ROV is not free for the appraiser - it adds hours of unpaid work and stress. An appraiser's opinion is a professional opinion backed by the appraisal . The other opinions are just trying to get a deal to work in their favor. There needs to be compensation for the added work an appraiser has to do to address it. I am not the first to suggest that of course.