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Appraiser Fraud or Mortgage Broker Fraud

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Mztk1

Thread Starter
Senior Member
Joined
Dec 3, 2006
Professional Status
Certified Residential Appraiser
State
Florida
I got a field review in. I hate accepting them because the fee is so low and I can't help but do a deep analysis on each one...I see it as my job to keep the profession honest. But anyway, the photos in the report are from some other date when the subject was in decent condition, and the house now is literally trashed.

Here is part of my comment on Point "1" on Form 2000 3/2005, concerning the photos:

Compare the front and rear photo of the subject property in this review to the front and rear photo of the subject in the original appraisal. The inspections are reportedly 9 days apart in the middle of January. There should be minimal if any change in the growth of the landscaping but growth in the rear photo, of the weeds and grass, is extensive, while the bush on the fence in the reviewer's photo is now dead but was thriving in the original photo. Also, note the front photo and the missing hand rail for the deck in the reviewer's photo as opposed to the photo in the original report, and also the growth, the leaves and acorns on the ground near the drive, and the blue tarp on the driveway that covered a pile of sand found in the reviewer's photo but not in the appraisal photo. Also note how in the original photos of the back of the house the crawl space is open, but in photos below, which show best in the photo of the rear porch addition, the crawl has been covered by plyboards that were painted and nailed in place and then the weeds grew around them. It is certain that the original appraisal's photos are taken at a much earlier time than January of 2008. Also note the photos below of the subject yard and improvements. The subject is undoubtedly in disrepair and in "fair" condition, but this is not disclosed in the report under review. The changes in the reviewer's photos from the original report's photos could not have happened in less than 2 weeks. This is cause for concern and sets the tone for the detailed analysis throughout this review.

Now my question is, would anyone call the original appraiser to find out if she actually did this report? The photos are only the beginning. "No" is checked in 10 out of 10 sections! This report is in the top 5 worst reports I have seen, and I get the feeling that maybe, just maybe, the MB has doctored it.

I don't know the other appraiser, never heard her name before. I don't know who she was trained by etc., but she has been certified for 5 years. There is definately fraud here, but by who I don't know.
 

USPAP Compliant

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
Jim,

My personal opinion is that appraisers need not decide who did what or when. If it appears there are serious issues...let the proper authorities investigate. That is their job.

The only investigation an appraiser need do is that which is required to have a reasonable opinion that a complaint is warranted. When you find evidence that you find compelling....file a complaint and let the proper authorities take over.

Again, I don't think is the appraiser's duty, obligation or right to contact the "other appraiser". Your client is asking for a review, contacting the "other appraiser" may not be what they want done. If they do...they should do it...not the review appraiser.
 

Michael Tipton

Senior Member
Joined
Sep 25, 2005
Professional Status
Certified Residential Appraiser
State
Florida
Aren't appraiser's offered the opportunity to rebut a review? If so, complete your review as accurately as possible.
 

USPAP Compliant

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
The offer is from the original lender or client....not the reviewing appraiser.


The offer is not guaranteed and not required.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Jim,

My personal opinion is that appraisers need not decide who did what or when. If it appears there are serious issues...let the proper authorities investigate. That is their job.

The only investigation an appraiser need do is that which is required to have a reasonable opinion that a complaint is warranted. When you find evidence that you find compelling....file a complaint and let the proper authorities take over.

Again, I don't think is the appraiser's duty, obligation or right to contact the "other appraiser". Your client is asking for a review, contacting the "other appraiser" may not be what they want done. If they do...they should do it...not the review appraiser.
I strongly agree!!!!!

Nothing prevents you from adding a sentence or paragraph to your review that with the items you found wrong in the original appraisal report under review that the original appraiser should probably be contacted to find out who actually completed this appraisal report.
 

hastalavista

Elite Member
Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
Now my question is, would anyone call the original appraiser to find out if she actually did this report? The photos are only the beginning. "No" is checked in 10 out of 10 sections! This report is in the top 5 worst reports I have seen, and I get the feeling that maybe, just maybe, the MB has doctored it.
(my bold)

Jim-

I'd say that has to do with your engagement agreement and SOW with your client.

I do reviews direct for lenders (not national but regional). Because of this, I am able to discuss with my client what they really want and then I develop an engagement agreement and SOW that addresses their needs and expectations (these are not Fannie/Freddie form reviews).

In all cases, my clients have authorized me to contact the original appraiser if I think it may be useful to my review analysis. Sometimes the call is to simply clarify something that was written and I don't understand. Sometimes the phone call is regarding a more significant issue. I only call if I think it can be meaningful in my review analysis (I try to do this professionally and with tact; usually my calls are received that way). And the only reason I call is because my client has given me that authority and it has become part of the engagement agreement and client expectation.

If I did not have this express permission, I would not independently take on this authority and contact the appraiser. I'd simply report what my findings and conclusions were to my client. Also, be careful about making any recommendations- depending on how you word them, your SR3 review could evolve into a SR4/5 consulting assignment (for my reviews, I have incorporated my consulting aspect into the engagement agreement, SOW and Certification- my prior lack of doing so was pointed out to me by S. Santora).

So, my position is unless the reviewer has the express authority from the client to contact the original appraiser, I'd recommend against it.

Good luck! :new_smile-l:
 
Last edited:

Michigan CG

Moderator
Staff member
Moderator
Joined
Nov 1, 2006
Professional Status
Certified General Appraiser
State
Michigan
Mr. Kloss, I just have to say great job in being so thorough. Last week I was told by my knowledgeable Michigan Realtor that EVERY SINGLE appraisal in SE Michigan is now reviewed.

Yours is an example of someone who got caught being less than truthful and hopefully it will reach the proper authorities. We really need good reviewers. There was a thread recently about a NAIFA certified review class being taught in the Chicago suburbs. It is in April I believe. I will for one be in attendance and if it takes joining the NAIFA to get the certification I will (hope it's not too much!!).

I would like to be one of those reviewers helping clean up.

I nominate you for the January 26, 2008 reviewer of the day.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Retired Appraiser
State
California
This type of issue got my brother kicked off a lender panel (big lender, you've seen the list). He did the report in like 2002. The property went into foreclosure and sat vacant for a long time. A retrospective appraisal was done and the reviewer took photos of overgrown weeds, cracks in the driveway, broken windows and graffiti and hit my brother on these issues. My brother was allowed the "opportunity" to rebut or explain but the process was so involved that he just said "F it."
 

Mztk1

Thread Starter
Senior Member
Joined
Dec 3, 2006
Professional Status
Certified Residential Appraiser
State
Florida
Mr. Kloss, I just have to say great job in being so thorough. Last week I was told by my knowledgeable Michigan Realtor that EVERY SINGLE appraisal in SE Michigan is now reviewed.

Yours is an example of someone who got caught being less than truthful and hopefully it will reach the proper authorities. We really need good reviewers. There was a thread recently about a NAIFA certified review class being taught in the Chicago suburbs. It is in April I believe. I will for one be in attendance and if it takes joining the NAIFA to get the certification I will (hope it's not too much!!).

I would like to be one of those reviewers helping clean up.

I nominate you for the January 26, 2008 reviewer of the day.

I appreciate the review of the day nomination, but it has been 1/24, 1/25, 1/26 and 1/27 on this one, hopefully not 1/28. Ugh. There is so much to it...and there isn't an easy solution finding the value either. Whenever I get this deep I start wondering why I even accept reviews. It is 5:45 on a Sunday and it is still being kicked back and forth in my brain. Last night I was up to 4 am writing a four page narrative on the house, trying hard to stick to the facts and taking out comments about "the appraiser" at least a dozen times saying, I got to stick to talking about the appraisal, not the appraiser. I have such a hard time believing it was really her who completed this report.

Thank you Denis, I like the idea of not including "consultation" as part of the review - and thanks to Steve who pointed it out to you - it certainly makes the issues more black and white.

And as always, thank you Pam for you input on these matters.
 
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