Appraisal didn't "make" the sales price...

[Lee SW IL]

You said they were going for 100% Financing. Was it the Niameia(sp?) program, where they get a "gift" for the downpayment?

I would suspect their is something else brewing here.

 

[Blue1]

Ken-NC,

Congratulations.......You are developing a reputaion as a good appraiser!! So far this week I've had 3 appraisals for purchases that "came in" under the sale price. Am I taking heat? You betcha!!! Funny, I asked the Realtors for better comps but haven't received any. Oh well.......Remember (in a purchase) you are "representing" a buyer AND a lender. Your appraisal is for THEM. NOT for the seller or the listing agent.

In the past, I have done appraisals for purchases and came in under the purchase price only to have the deal fall through. Guess what? The buyer went and made an offer on another home and requested my services......why? Because they trusted my opinion........The lender was happy because they felt that they adequately represented their client, the client was happy because for the price of an appraisal fee, they saved thousands of dollars........It does work that way believe it or not!!!

 

[Leon Stewart]

Pamela-

I have filed complaints on more than one occasion to the state. The State regulators are getting buffet passes and rodeo tickets form NAR. I have seen numberous truly aggregious acts and no positive outcome of remedy.

Leon is calling it however. My firms does very little mortgage work. Completely blackballed for good, clean, thorough appraisal work and have been for a long time.

Verne:

Pamela knows what goes on in this business, and she knows very well that you can't go around sueing every lender or Realty Agent (Not all Agents are Realtors) who decides to select the appraiser who will prepare the report that he and the Agent needs to close their deal.

Until Lenders are removed from having anything to do with the Appraiser or the Appraisal Process, this problem will continue. Under the current system they are given the option to select whomever they want, and now with the onslot of the AVM's they can select whatever type of Report they want and exclude the Appraiser altogether, and contrary to what some appraisers want to believe, they don't have any say at all in what is done about the Appraisal Process in general.

Leon

 

[Steve Owen]

Ken, no one really answered your question. I don't know of any law, either state or federal, that makes it illegal to attempt to coerce an appraiser. However, it is quite illegal for an appraiser to report a fraudulent value, and some have gone to jail for doing so (remember Whitewater?).

On the other hand, the prospective buyer/borrower could sue the realtor/mortgage broker in civil court. If you give into their demands, the borrower could also sue you in civil court.

I think your question might be interesting fodder for a new thread on the political action forum. "Should there be a law against trying to influence an appraiser's value?" It might go a long way toward ending the mortgage broker corruption/coercion problem.

 

[Mike Garrett RAA]

Steve, several states have passed legislation making it illegal to "attempt to influence" the appraiser.

 

[Leon Stewart]

It's not necessarily coercion for a Lender not to use an appraiser. Lenders have as many as 50 Appraisers on their Approved Roster, but they might use only five. There are many reasons why a Lender may decide not to use an appraiser, and he usually doesn't have to give the appraiser a reason.

For an appraiser to consider sueing a lender to try and get more work assignments would be self defeating, not considering the fact that it would be difficult to prove his case since the lender would probably back up his decision with several Review Reports.

Leon

 

[Judy Whitehead (Florida)]

My usual response to those that dispute my adjustments and/or comps is - you show me - Mr. Real Estate Agent/Broker - Show me an example of a sale "with" the view and one "without" the view that sold for less. Show me an example of one "with" extra landscaping and one "without" that sold for less - and all of this, of course in the subject's neighborhood.

Once a real estate agent sent me "comps" that were up to five miles away and in superior subdivisions with clubhouses, etc. (the subject was not). I asked her why she thought they were "comparable" and she said they were close to the same size in living area. She didn't have much to say about the ones that were the same size in the subject's immediate subdivision! Hang in there!

 

[Ken-NC]

I guess what I was attempting to ask is simply this:

I feel very strongly against the "dual agent" concept and this sort of proves my point.

A. As the listing agent, she either skipped the CMA, or withheld the information from the CMA and asked the sellers, "so, how much do you want?"

B. As the selling agent, shouldn't she have been looking out for her buyers and said, "Look, I just found two sales less than 30 days old in the same subdivision. They're bigger, newer, have basements and they sold for LESS! Maybe we should make an offer..."

So, other than being unethical, has she broken any laws?

I do believe it IS illegal to suggest or lead an appraiser to a pre-determined value. As I understand it, it's even illegal for a lender to add the following to an order: "Estimated value: $185,000." Am I wrong? Dunno for sure.

I'm not looking to sue or pursue this any further, it just peeves me like I'm sure it peeves anyone in my position. I was just hoping for a little more ammo if/when she calls the office again.

Thanks all.

Ken

 

[Mike Garrett RAA]

Ken, it is not illegal! What could be illegal is IF you as the appraiser let it influence you to appraise to a predetermined value.

Remember the role of the real estate agent....get the property listed (first) and get the property sold (second). Agency isn't an issue either. The agent isn't required to even do a market analysis.

 

[Verne Hebert]

The two most readily options are:

If you are a member of MLS, and the type of membership you have defines you as a "realtor"; you have all rights and repurcussions a realtor has based upon the by-laws. You will have to read them and find the areas you think the realtor has violated and submit a formal compliant. (The association will not be excited about an appraiser filing against a realtor, they however exceed their jurisdiction in realtors filing against the appraiser, at least here). It will go through the process and little will likely come out of it.

Your second avenue is file a complaint against the realtor through the State Board of Realty Regulation. This will have much greater merit being the state agency is just that, and the AR is a "club".

Good Luck!