Appraiser independence

[George Hatch]

Ima post this little soundbite by itself:

As appraisers the primary thing we sell is not signed 1004s. What we really sell, the only attribute that makes our work marketable to begin with, is our credibility.

Everybody has an opinion of value. There's nothing special about that. What makes our opinions marketable is our objectivity and impartiality and our technical competency. Our workproducts are but expressions of that.

 

[glenn walker]

A general observation- an irritating aspect - the appraiser is not telling the buyer what to pay and the appraiser is not stopping the borrower from paying the contract price - all the buyer has to do is put down the difference in cash. Isn't it amazing then, that the buyer is happy to use the lender's $, but not their own to get to a sales price. The reality is, a buyer when they apply for financing runs risk of not getting the LTV from appraisal. Boo hoo. buyer...bring the difference in $ of your own funds and feel free to pay whatever price you want.

He is an-appraiser he has no cash to bring in : ) LOL

 

[J Grant]

As a purely practical and self-serving matter.....

Whether the borrower is an appraiser or not, any time you're coming in lower than the contract price on a sale that was exposed through the MLS then you need to go on offense. Not only do you need to demonstrate why you concluded to less than 4% of the contract price, but you actually need to demonstrate why the contract price cannot be considered a reasonable expression of market value as defined. Why the contract price is obviously outweighed by the comparable sales.

You're not going into double overtime in order to protect your client's interests so much as to protect your own. You never want to knowingly expose yourself to an ROV without doing everything you possibly can to sell your opinion to your reader. You want to give your reader everything it takes to trust your opinions above any and all contrary opinions. You want to be more informed about all the relevant sales data than even the brokers.

Whenever you run into one of these situations you need to recognize that you are entering Thunderdome and you need to act accordingly. And you need to do it in your original report. You need to crush all hopes anyone else might have toward getting a different outcome.

This illustrates the intimidation surrounding appraisals and lack of independence/failure of the supposed AMC firewall ( when there is an AMC and there often is)

An appraiser coming in "low" should not have to face a Thunderdome of repercussions- and it's not just when a SC price is in play, it's also when there is a so called "low" value on a refinance. But I agree, it is prudent for appraisers to spend spend extra time if their value is below a SC price double checking the sales, listings, and support of their value. If a ROV comes, deal with it then - often the "comps" are bizarre, but the whole experience can be awful, or reasonable, depending sometimes on the client.

 

[glenn walker]

He is an-appraiser he has no cash to bring in and if he is a CG he is probably 60 years old and his wife threw him out and now he is just angry-- Give him a break ROV it and take it up 2% and fight with him for another few weeks

 

[George Hatch]

Your post, though well meaning, shows the stark intimidation surrounding appraisals and lack of independence/failure of the supposed AMC firewall ( when there is an AMC and there often is)

Obviously you can't prevent every ROV. But you definitely can go beyond the autopilot version of showing 3 sales and concluding to a value. An appraiser's default will be fine most of the time, but sometimes they need to pull out all the stops. As I say, not for their clients, but for their own interests.

Your clients will be making a decision as to which version they think is most credible, and we should expect them to do that based on the workproduct, not based on the fact that we hold a license so the workproduct must be assumed to be reasonable.

SR1 is about being right to begin with
SR-2 is about demonstrating it *to the satisfaction of our users*. Not to each other and not to an AMC or other 3rd party.

I conclude to other-than-expectations in a significant percentage of my assignments, so I find myself going on offense on a regular basis.

 

[glenn walker]

There has never been a firewall- At the Savings & Loans in the eighties and nineties the Chief Appraiser was not going to keep anyone who was not hitting the numbers 90% of the time, of course that was never the reason given to the appraiser when he/she got their pink slip. The AMC or even direct lenders goal is to fund loans and outside of fraud or an-extremely over inflated appraisal lenders will blame the appraiser, So now you have to ask yourself is a 2% to 4% difference in a SC really going to make any difference ? Not unless the contract price was way over-inflated to begin with -- Just Saying : )

 

[KiKki]

If a person lets you know they are an appraiser, it is a great time to go back to the office and say you cannot complete the report and let them get someone else. Risk risk risk...I would tell the AMC the conversation and do not take any calls from the appraiser...let them text you or email you. You have the email. It is a direct threat. Keep it and include it in the ROV if you get one.

I know, I regret not to have dropped from the assignment after the inspection

 

[KiKki]

Obviously you can't prevent every ROV. But you definitely can go beyond the autopilot version of showing 3 sales and concluding to a value. An appraiser's default will be fine most of the time, but sometimes they need to pull out all the stops. As I say, not for their clients, but for their own interests.

Your clients will be making a decision as to which version they think is most credible, and we should expect them to do that based on the workproduct, not based on the fact that we hold a license so the workproduct must be assumed to be reasonable.

SR1 is about being right to begin with
SR-2 is about demonstrating it *to the satisfaction of our users*. Not to each other and not to an AMC or other 3rd party.

I conclude to other-than-expectations in a significant percentage of my assignments, so I find myself going on offense on a regular basis.
[/QUOTE
I tried to address everything in my report after I finished I thought the CG is going to understand I had no option but I was naive

 

[ucbruin]

I don't mean to sound harsh....
But any appraiser afraid to appraise a home because it is owned by an appraiser....

Should probably find a different job....

 

[djd09]

Nobody is independent that is a buzzword propagated by many.

exactly. they should let us be advocates, state in the report, because there is no misleading in transparency.