ASC numbers

[Mile High Trout]

Is that not directly related to the record low mortgage origination numbers?

Origination Activity | Consumer Financial Protection Bureau

Origination Activity

www.consumerfinance.gov

No it is not.

Licensee attrition continued despite historically high origination activity for many years prior.

 

[Mile High Trout]

WAIVERS are low-tech. What is advanced tech about a borrower or lender writing in their own estimate of value for a property?

I agree we can and should embrace technology. I don't believe AI can replace an appraiser; an appraiser can use it well or poorly.

You're missing the point of the appraisal modernization program.

They don't want to replace appraisers. They are substituting independent value opinions with their own controlled in house proprietary avm's.

We have investigated ourselves and determined everything is o.k..'

Waivers and their own 'rules.' The AVM final rule. All lenders need to do is fill out a two page form every other year to self certify their internal valuation programs which are not subjected to any external oversight or auditing, are not required to be implemented or overseen by anyone with an individual appraisers license, the programs algorithms and internal decision making structures proprietary, are just as good if not better than using actual full service independent appraisers. A two page bi annual valuation program reliability self certification; Just as good as the independent appraisal program. The entire hybrid program is based on similarly watered down rules, that all revolve around their initial avm calculus associated LTV ratios in the first place.

The lesson of Zillow; How does one sell their avm utility ahead of the competition? Higher numbers! Unlike Zillow, the GSE's gamble and are backstopped by the taxpayer. Which is why a structure that lacks balanced accountability and external oversight is unacceptable.

The root cause of the problems here revolve around the disparities regarding multiple different standards applied which leads toward loan origination or subsequent liquidation. Think of this as a departure from standard mathematical order of operations guidelines. Depending on the situation and need, order the mathematical sequence however you would like, a singular standard rule no longer applies. Depending on how one structures the 'valuation request', there certainly can and will be variable outcomes.

Dear state of Maryland....

https://appraisersblogs.com/fannie-mae-2-state-of-maryland-drop-dead/

The various individual changes could have been accomplished without a total program radical restructuring. Additional sought after data could have been tagged into new forms which accompanied the tried and true old forms. There is definitely something to be said about the concept that nobody outside of the GSE world will be using a similar form. Again, a variable standard. The modern equivalent of clipping the coin, thumb on the scale, hollowed out weights. Curiously the entire world still relies on standard weights and measures. Except for the GSE's now a days, they're a special exception because they're dealing with real property value which is apparently simply too complicated to have one standardized approach.

Imagine being a consumer against invasive technology such as for instance what's popular now, the flock systems resistance. Only to experience this first hand in your own home from your mortgage lender, when trying to get through a simple refinance. The objections may begin with the vendors and small businesses displaced but they most certainly will not end there. The entire range of objections, process, management, privacy, financial security.

The people pushing this seem to have a really difficult time reading the room. Probably because they're not the ones tasked with doing the actual work, nor will they deal with the consequences of the data brokering. The real truth of data brokering is that the long term income streams associated with this dwarf what used to be a straight forward traditional process of churning products off the line for one time profit tallying. The tokenization of real estate.

Make of the objections what you will. Like the tens of thousands whom came and went before, many are taking a hard turn for the exits.

It may be somewhat difficult to bark never ending mandates to an empty room.

That's where the automatic utilities come in, as designed, as planned.

 

[Mile High Trout]

AVM's were around for a decade or more before the Waivers were approved. Very few appraisers, or anybody, have an idea of how the AVM works. That is what makes them less trustworthy. Since almost nobody understands how they work, what is the trust based on with them? An AVM has a confidence score (typically) about the value estimate, so even the tech of the AVM is warnignt atht it is not 100% accurate or infallible.

What is the value range, for example, for a 400k range property that gets an AVM before getting a waiver approval? Is the value range of the AVM (if 400k is the point value esimate - or is it just a range/? ...is the AVM a tighter range of 380k-420k, or a very broad range from 370k-450K?

Does anybody outside of Fannie or Freddie see these AVM;'s to know how broad the tolerance range is for the lender or borrower estimate, or where the SC price fits in?

Regardless of the fact that an AVM was done , the borrower or lender is still estimating a value for the property that lets the deal work (or the CS is used), and the borrower or lender estimate or SC price might not be a credibly supported MV of the property.

Ummmm.... I know how they work. They are price reactive. They can be manipulated and are manipulated with associated data, even for listing non sales.

It's right there in front of anyone if they'd care to look.

Appraisal modernization and waivers!

The home is worth what it needs to be worth for higher loan closing rates. That's how this works.







Surprise!








Appraisal modernization and waivers!

The home is worth what it needs to be worth for higher loan closing rates. That's how this works.

 

[glenn walker]

I never said or wrote that in any of my posts. I do not personally believe it either. No value estimate from any product nor a market value opinion from an appraisal is 100% accurate and infallible. It is not possible. That is why an AVM value has a confidence range.

The appraiser's point value is supposed to be credible and meet the standards of development. The appraiser stands behind their MVO with their signature.

In an appraisal, a client or user can read the report and follow the steps to see if the logic, reasoning, and comp adjustments make sense. That is not true of an AVM. The AVM is not seen in a waiver by outsiders. Most users and readers can not figure out how an AVM did its computations or what data it used (typically). An appraisal is a report that can be read and understood.

In a WAIVER, the person who estimated the value, the lender or the borrower, does not take responsibility for the value. Appraisers take responsibility for their value.

I read a Fannie statement that the value estimate in a waiver might not represent the value of the property. Even they admit it!

The appraisal may not represent the true value of the property-especially since you say the AMC appraisers are mostly just numbers hitters.

That would clearly be implying that we have serious-systemic valuation issues using real appraisers not waivers.

 

[J Grant]

The appraisal may not represent the true value of the property-especially since you say the AMC appraisers are mostly just numbers hitters.

That would clearly be implying that we have serious-systemic valuation issues using real appraisers not waivers.

IDK if most AMC appraisers are number hitters. I do know that the AMCs ( and some lenders ) will stop giving appraisers work who come in "low" too often for their liking. The better lenders or wholesale brokers will keep sending appraisers work even if they come in "low," as long as that is a credible, supported market value. IDK how long that will continue. They must feel the pressure to grant waivers.

What has happened to the appraisers on the regulated res lender side has been a multi-year campaign to marginalize them and make it difficult to appraise to MV in some cases if it means coming in below a SC price. It started with changing the old FHA rotation panel to "lender select" FHA, and as soon as that happened, fraud and some inflated values and property flipping filled the FHA loans, to the point that the FHA required two appraisals on flips. Rotation panels should have been instituted when the HVCC tried to clean things up, but of course that would have kept a few more deals from closing at inflated prices, so it was defeated.