Appraiser Independence Question

[NC Appraising]

I got this revision request: "Market Data indicates a different adjustment for condition rating. Appraiser is requested to revisit the adjustments or correct the report."

If this isn't interference with appraiser independence, then what is?

I'm not saying that I'm perfect, of course no one is. But I don't make adjustments for condition for fun or without substantiation, and what i'd really like to say is this: if you know what the market adjustments are, why don't you do the appraisal and not assign it to me?

I was requested a week ago to perform a review on a recently purchased home. With the request, the lender uploaded the appraisal. I took a quick look, as the home is 2 minutes of my home.

The appraiser marked the home as a C4 home. OK, is has a newer roof, updated baths, etc. It could be a high rated C4 home or a low rated C3 home. The subject is a two story home.....he used all ranch style homes that are really in C3 condition to hit the value.

Instead of making appropriate market condition adjustments and using more similar two story homes, he used ranch homes of superior condition and made $2k market condition adjustments in a market where it is appreciating 6%-8%. The $2k market condition adjustment for a 7 month sale just looked silly and stood out like a sore thumb.

This is a old appraiser that had a trainee factory. He is either to old to care, has always hit the value or does not realize that UW's and review appraisers have the same data that he does.....quick Zillow search....It is not rocket science to go to Zillow and read the agents BS and then look at the pics to determine if the appraiser is BS the condition ratings.


Sad thing is that the review appraiser will probably just rubber stamp it, as this lender is known for shady hit the value loans and just needs a rubber stamped review appraisal.

 

[Tom D]

long ago & some still today, if you have non AMC clients, a phone call to the person/underwriter requesting would be a 1 minute discussion of the question to find out exactly why the request, with an easy resolution. there are no rules against that talking, but it seems to some that we can't talk to anyone. so now you ponder for hours, as to exactly, what do they see that they need an answer to.

 

[sputnam]

I got this revision request: "Market Data indicates a different adjustment for condition rating. Appraiser is requested to revisit the adjustments or correct the report."

If this isn't interference with appraiser independence, then what is?

I'm not saying that I'm perfect, of course no one is. But I don't make adjustments for condition for fun or without substantiation, and what i'd really like to say is this: if you know what the market adjustments are, why don't you do the appraisal and not assign it to me?

It doesn't sound like interference to me. It sounds like someone is seeing contradictory information in your report. If you don't see it, ask them for additional detail. Take an honest look at it. If you find an 'error', fix it. If it's not an error, then add some explanatory comments.

 

[ramrcdk]

Me either. The CU software had C4 or other RATING ... for example. NOT necessarily the adjustment. Be glad it’s not a value challenge!

 

[Elliott]

I've got the "market says something" stipp. I just say, "I don't know what data you are looking at, but here's a few pages from my workfile on how I developed my adjustment from market data." They go away. Its not pressure, just that other appraisers are using different adjustments.

 

[Mejappz]

Tell them you will be happy to revisit once they make the “Market Data” available to you. (i.e., the stolen database that is in the GSEs possession). In the meantime, send a complaint to your State as well as the FHFA.

 

[glenn walker]

Tell them you will be happy to revisit once they make the “Market Data” available to you. (i.e., the stolen database that is in the GSEs possession). In the meantime, send a complaint to your State as well as the FHFA.

State boards do not get involved in these type of issues neither does FHFA and worse if they did often they will ask the appraiser for a copy of his-her report and a complete work file and then they review his appraisal, and if you get unlucky they find a few USPAP errors to charge you with or mistakes you made and suddenly the Hunter becomes the Hunted. And the CU is not a stolen data base-because we don't own our reports and your Pre-Printed Fannie Certification #21-22-23 lays out numerous ways your report can and will be used. Finally Nothing will P***-Off a Bureaucrat more than a crybaby appraiser, they have to many other issues to deal with. So choose what hills are worth dying on and this one doesn't even come close. A Little Saturday Satire Below:

FHFA & State Boards Response : We have received your complaint made against Bigger Bank USA which CU had indicates a different adjustment for condition rating from a prior report on the subject property . The Appraiser was requested to revisit the adjustments or correct the report. We found no pressure was placed on the appraiser, and his or her response was simply to take a second look or if an-error was made to correct it. This does not rise to the level of a State Board Complaint nor a complaint to the FHFA. We also reached out to Bigger Bank USA and they kindly forwarded us a copy of your report and a Field review they have done so we could review your report and what they have discovered. Below are what our investigator has found.

Appraisal data Integrity-Misrepresentation-of Physical Characteristics
The appraiser-apparently is not aware that Lenders under Dodd & Frank-and Agency Guidelines are responsible for the accuracy and completeness of the appraisal and its assessment of the marketability of the property and must take appropriate action to ensure that appraisers do not engage in unacceptable appraisal practices, including misrepresentation of the physical characteristics of the subject property , improvements or comparable sales. Therefore it is a reasonable request when a Fannies CU database has shown a different condition rating had been made last year. The lender just wanted the appraiser to simply take a second look to make sure no error had been made. This does not constitute pressure and is not a violation of appraiser independence. Unfortunately we did observe the following errors which both we and Bigger Bank USA's Field review had found.

Comparable Sales (s) Physical features Reported Inaccurately
The appraisal did not accurately reflect the physical feature of the comparable sale's. The appraiser failed to support his condition adjustments and did not adequately explain how he extracted them.

Thank You: Please forward us a check for $1,500.00 which will be used to cover our investigators time and headaches you have created. Also sign up for a 7 hour course in how to extract and support your adjustments. You will have 90 days to complete your adjustment and your 15 hour USPAP class which is required because your report was not developed in compliance with applicable standards and requirements. Finally Fannie & Freddie have placed you on their restricted license list because you stated they had stolen your data to use in their Collateral Underwriting System. These kind of accusations will not be tolerated. As far as Bigger bank USA they have removed you from their fee panel because now you have a ding with your State Board and F & F.

 

[Cob]

Once again, it's in black and white.








From Lender Letter LL-2015-02, February 04, 2015

Fannie Mae



****The lender must not make demands or provide instructions to the appraiser based solely on automated feedback. Also the CU license terms prohibit using it “in a manner that interferes with the independent judgment of an appraiser.” Fannie Mae expects the lender to use human due diligence in combination with the CU feedback, and will actively follow up with lenders who are reported to be asking appraisers to change their reports based on CU feedback without any further due diligence.****

 

[ramrcdk]

Once again, it's in black and white.








From Lender Letter LL-2015-02, February 04, 2015

Fannie Mae



****The lender must not make demands or provide instructions to the appraiser based solely on automated feedback. Also the CU license terms prohibit using it “in a manner that interferes with the independent judgment of an appraiser.” Fannie Mae expects the lender to use human due diligence in combination with the CU feedback, and will actively follow up with lenders who are reported to be asking appraisers to change their reports based on CU feedback without any further due diligence.****

I would definitely highly suggest "everyone" including appraisers & lenders READ & become fully educated on WHY - WHEN - HOW to properly dispute the SCA Grid including CU rating PRIOR requesting an inept value challenge. There are dispute forms that should be adequately-properly completed for the appraiser to adequately -properly respond TO.

 

[glenn walker]

I would definitely highly suggest "everyone" including appraisers & lenders READ & become fully educated on WHY - WHEN - HOW to properly dispute the SCA Grid including CU rating PRIOR requesting an inept value challenge. There are dispute forms that should be adequately-properly completed for the appraiser to adequately -properly respond TO.

I think we all know the CU rating is generated and how its used- BUT- a Demand means the appraiser must do something a request can be accepted or rejected, but neither reaches level of of a State Board or FHFA complaint. Only when the lender asks for a value to be changed or something that is not of a factual nature-all the rest is just appraiser frustration which often could be eliminated by simply saying yes or no