Better Hit That Number!

[djd09]

The lenders i deal with blacklist you for the bad service you give, not a low appraisal.

I was very friendly with a order giver out. I would have fired them to hearing about their poor service.

so you can kill every deal...and they keep hiring you...i cant stop laughing

 

[djd09]

That’s what I’ve said for a decade, if you thought saying no to some mortgage broker, sending you a couple jobs a month was tough, you’ll never be able to say no to class or clear capital that are sending you 30. Makes you think that’s what they wanted all along.

it is crazy to think that 06 is the floor...

 

[Fernando]

View attachment 89967

it is crazy to think that 06 is the floor...

I'd been fortunate or intuitive. From the chart, I'd been buying right before a boom. Best was in 2012 when I felt the bottom finally was to occur.

 

[RCA]

FHFA Announces Enterprise Reconsideration of Value Policies | FEDERAL HOUSING FINANCE AGENCY

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced that Fannie Mae and Freddie Mac (the Enterprises) published new Reconsideration of Value (RO

www.fhfa.gov

Freddie Mac Single-Family Seller/Servicer Guide

The new, user friendly Seller/Servicer Guide will make it significantly easier for you and your team to find, understand and share critical information.

guide.freddiemac.com

This update also requires the Seller to:

• Forward the appraisal report, along with a summary of findings, to the appropriate appraisal licensing agency or regulatory board if material deficiencies are identified in the appraisal report that are not corrected or addressed by the appraiser upon request or if there is evidence of unacceptable appraisal practices. In addition, if there are suspected overt violations of antidiscrimination laws, the Seller must report them to the proper local, State or federal agency.

If you are using traditional appraisal methods and dealing with a non-conforming house, you are at risk of complaints being filed.

I wouldn't be worried, .... But I want $1200 min.

 

[djd09]

In the charge, HUD alleged that in 2021, Rocket Mortgage denied a borrower’s application to refinance a mortgage based on what HUD considers to be a discriminatory appraisal report, in violation of the Fair Housing Act. According to the factual allegations, the applicant, a Black woman, applied to refinance a mortgage on a duplex in a predominantly white neighborhood in Denver, CO. In order to process her application, Rocket Mortgage ordered an appraisal of the property from Solidifi. Solidifi, in turn, selected Mr. Mykhailyna of Maverick Appraisal Group to conduct the appraisal and provided him with Rocket Mortgage and Solidifi’s extensive guidelines and instructions for the appraisal. HUD concluded that the appraiser reached an “insupportably low” value for the borrower’s duplex based on the following asserted factors, among others:

• Property values in the area were generally increasing around the time of the subject appraisal, which was the only appraisal of the subject property out of seven conducted over nine years that indicated a drop in the property’s value ($640,000 in 2021, compared to $860,000 in 2020 and $750,000 in 2018).
• In selecting comparables, the appraiser chose properties only to the east of the subject property, in areas with higher concentrations of Black residents, ignoring several closer duplexes to the west in a more predominantly White area that had higher sales prices, and the appraiser had used comparables in that area when appraising a home in the same area as the subject property for a White owner.
• The appraiser failed to account for positive adjustments that would have come from including a more detailed description of the basement and the consideration of recent renovations that were made to the property.
• In conducting appraisals for White property owners in the same neighborhood, the appraiser made area adjustments reflecting a more favorable view of the neighborhood, and he described the area’s access to amenities more favorably.

According to HUD, after reviewing the appraisal report, the applicant spoke with representatives at Rocket Mortgage about her concerns that the report might be discriminatory. HUD also claims that Rocket Mortgage then informed the applicant that she could proceed with her loan application using the appraised value or she could have her loan application cancelled or denied and her discrimination complaint referred to Rocket Mortgage’s Client Relations Department. Ultimately, the application was “cancelled” and “denied,” and the applicant was unable to refinance her mortgage for a lower interest rate or more favorable terms.

In the announcement regarding this charge, Diane M. Shelley, HUD’s Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity stated, “HUD will continue to vigorously enforce the Fair Housing Act against those who seek to limit the financial returns associated with homeownership because of race or any other protected characteristic.” Due to the official charge from HUD, the case will be assigned to an administrative law judge, unless any party elects to have the case heard in federal district court. Potentially, a decision on the matter may provide guidance to the industry regarding appraisal bias claims.

i missed the part where the appraiser denied the loan...or is even part of that decision...well anyways looks like he didn't hit that number

 

[Zoe]

The fundamental thing that none of these people, most of which I assume if not performed an appraisal in 20 years, fails to understand is that I have yet to meet an appraiser who intentionally comes in low on any assignment. Coming in low creates a massive amount of headaches and extra work. I’m sure there’s racist people out there, but I doubt there’s too many people that like making extra work for themselves.

there’s just a lot of people making a living in the appraisal profession who are not performing appraisals and are trying to justify jobs.

Yeah, if you are racist, there are certain professions you don't want to enter. Appraisal is one of the professions you don't want to pursue. I don't appraise people. I appraise real property rights. KISS principle. Keep it simple stupid.

 

[Zoe]

In the charge, HUD alleged that in 2021, Rocket Mortgage denied a borrower’s application to refinance a mortgage based on what HUD considers to be a discriminatory appraisal report, in violation of the Fair Housing Act. According to the factual allegations, the applicant, a Black woman, applied to refinance a mortgage on a duplex in a predominantly white neighborhood in Denver, CO. In order to process her application, Rocket Mortgage ordered an appraisal of the property from Solidifi. Solidifi, in turn, selected Mr. Mykhailyna of Maverick Appraisal Group to conduct the appraisal and provided him with Rocket Mortgage and Solidifi’s extensive guidelines and instructions for the appraisal. HUD concluded that the appraiser reached an “insupportably low” value for the borrower’s duplex based on the following asserted factors, among others:

• Property values in the area were generally increasing around the time of the subject appraisal, which was the only appraisal of the subject property out of seven conducted over nine years that indicated a drop in the property’s value ($640,000 in 2021, compared to $860,000 in 2020 and $750,000 in 2018).
• In selecting comparables, the appraiser chose properties only to the east of the subject property, in areas with higher concentrations of Black residents, ignoring several closer duplexes to the west in a more predominantly White area that had higher sales prices, and the appraiser had used comparables in that area when appraising a home in the same area as the subject property for a White owner.
• The appraiser failed to account for positive adjustments that would have come from including a more detailed description of the basement and the consideration of recent renovations that were made to the property.
• In conducting appraisals for White property owners in the same neighborhood, the appraiser made area adjustments reflecting a more favorable view of the neighborhood, and he described the area’s access to amenities more favorably.

According to HUD, after reviewing the appraisal report, the applicant spoke with representatives at Rocket Mortgage about her concerns that the report might be discriminatory. HUD also claims that Rocket Mortgage then informed the applicant that she could proceed with her loan application using the appraised value or she could have her loan application cancelled or denied and her discrimination complaint referred to Rocket Mortgage’s Client Relations Department. Ultimately, the application was “cancelled” and “denied,” and the applicant was unable to refinance her mortgage for a lower interest rate or more favorable terms.

In the announcement regarding this charge, Diane M. Shelley, HUD’s Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity stated, “HUD will continue to vigorously enforce the Fair Housing Act against those who seek to limit the financial returns associated with homeownership because of race or any other protected characteristic.” Due to the official charge from HUD, the case will be assigned to an administrative law judge, unless any party elects to have the case heard in federal district court. Potentially, a decision on the matter may provide guidance to the industry regarding appraisal bias claims.

i missed the part where the appraiser denied the loan...or is even part of that decision...well anyways looks like he didn't hit that number

You touching on areas that may reach the lenders and gses and who knows who else.

What about differences in interest rates or closing costs, appraisal fees, etc.etc.etc. ????

 

[Non Sequitur]

If you are using traditional appraisal methods and dealing with a non-conforming house, you are at risk of complaints being filed.

Perfectly describes the current state of the residential appraisal market. Whether it’s waivers, bifurcated products, or staff appraisers taking all of the easy ones, about the only thing left for true independent appraisers are the non-conforming properties. And it doesn’t matter if an appraiser uses traditional methods or some of the fancy software that’s being pushed, these properties do not fit into the box and never will. With the demand for unprecedented amount of detail in reports, the unprecedented demand for quick turn times, and unprecedented low fees, the industry is in trouble.

 

[RCA]

Perfectly describes the current state of the residential appraisal market. Whether it’s waivers, bifurcated products, or staff appraisers taking all of the easy ones, about the only thing left for true independent appraisers are the non-conforming properties. And it doesn’t matter if an appraiser uses traditional methods or some of the fancy software that’s being pushed, these properties do not fit into the box and never will. With the demand for unprecedented amount of detail in reports, the unprecedented demand for quick turn times, and unprecedented low fees, the industry is in trouble.

Well, I don't know about that. The RCA (Residual Constraint Approach), which requires doing all adjustments through feature value contributions, almost guarantees a perfect appraisal. ALMOST. There is a caveat: You have to be very good at estimating the Residual for the Subject --> Which implies a good ranking of all properties you feed to your MARS regression. on the basis of residuals ---> Which implies good quality residuals --> Which implies good quality MARS regression estimates of Net Sale Price (based on measured variables) --> Which implies a high quality MARS Price Model --> Which implies you know, VERY WELL, how to use MARS.

Let's put it this way. If you always go through the step of first estimating the Value Contribution of all features impacting Net Sale Price, assuming you abide by the constraint that all Value Contributions add up to the property Net Sale Price, then the mathematical proofs I have already supplied on this forum, ensure that you can alter those contributions ANY F**KING WAY you want, and you will not change the outcome, WITH THE EXCEPTION OF ONE AND ONLY ONE VALUE CONTRIBUTION: The Subjject's Residual. That makes the method fairly robuts.

If you know MARS, you should be able to complete a Salels Grid, with all adjusted sale prices exactly the same, and a perfect value conclusion, even if you are half-drunk!!

-- Well, of course, and to reiterate, if your MARS Price Model is screwed up, your Residuals will be screwed up, your ranking of properties from least appealing to most appealing screwed up, and you will be left to you best possible of assignment of Sex Appeal, aka CQA (Condition/Quality/Aesthetics), 0.00-10.00, using your best judgement. Still, I bet a lot of appraisers could do this walking in their sleep (almost). But, any reviewer or auditor or underwriter coming along will look at your model and ask if it make sense --->. You won't be able to cheat on that.

 

[Non Sequitur]

Well, I don't know about that. The RCA (Residual Constraint Approach), which requires doing all adjustments through feature value contributions, almost guarantees a perfect appraisal. ALMOST. There is a caveat: You have to be very good at estimating the Residual for the Subject --> Which implies a good ranking of all properties you feed to your MARS regression. on the basis of residuals ---> Which implies good quality residuals --> Which implies good quality MARS regression estimates of Net Sale Price (based on measured variables) --> Which implies a high quality MARS Price Model --> Which implies you know, VERY WELL, how to use MARS.

Let's put it this way. If you always go through the step of first estimating the Value Contribution of all features impacting Net Sale Price, assuming you abide by the constraint that all Value Contributions add up to the property Net Sale Price, then the mathematical proofs I have already supplied on this forum, ensure that you can alter those contributions ANY F**KING WAY you want, and you will not change the outcome, WITH THE EXCEPTION OF ONE AND ONLY ONE VALUE CONTRIBUTION: The Subjject's Residual. That makes the method fairly robuts.

If you know MARS, you should be able to complete a Salels Grid, with all adjusted sale prices exactly the same, and a perfect value conclusion, even if you are half-drunk!!

-- Well, of course, and to reiterate, if your MARS Price Model is screwed up, your Residuals will be screwed up, your ranking of properties from least appealing to most appealing screwed up, and you will be left to you best possible of assignment of Sex Appeal, aka CQA (Condition/Quality/Aesthetics), 0.00-10.00, using your best judgement. Still, I bet a lot of appraisers could do this walking in their sleep (almost). But, any reviewer or auditor or underwriter coming along will look at your model and ask if it make sense --->. You won't be able to cheat on that.

The future of GSE work is banging on the door, and it will look like the link below. The only GSE work that will trickle down to true independent appraisers are the properties that AMC and staff appraisers can't figure out while trying to deliver a report in the field.

Nighthawk - Appraising Reimagined | Bradford Technologies, Inc.

www.bradfordsoftware.com