Blind Squirrel and Acorns

[Evincere]

You cite some examples where obviously some of the BPO's in a file had an Nothing that has been presented in this thread is actual, credible evidence that the VP of Loss Mitigation (a very smart guy with 30 years experience) at my company is incorrect when he tells me that BPO's generally work better than apprisals for this purpose.

His conclusion is based not only based on his experience but actual studies that showed this to be the case.

Would like to see the actual, factual "studies" you referenced as credible and who they were conducted by - your statement implies that there is more than one study.

Are these studies published?

Unless references are provided for review its just more "here say" and as a student of law you know well enough that such a statement does not support either your or your VPs position.

 

[NLCApprMgr]

When I see appraisals like this, I wonder how lenders have any faith in appraisers at all. If you just make $1,000 per acre adjustments and $12 per foot GLA adjustments so none of your adjustments exceed guidelines it flies right through the check list reviews.

Tell it on the mountain, preacher man!! Amen, bruddah!!!

 

[Eli]

Of course internal due diligence is very important. If you have the wrong internal policies and leadership, then you have problems. Internal lending guidelines, internal compliance of law/regulation, approved appraiser qualifications, etc... is crucial....priceless.

 

[Evincere]

Tell it on the mountain, preacher man!! Amen, bruddah!!!

http://appraisersforum.com/showthread.php?p=2464714#post2464714

 

[Eli]

It is common knowledge that it is not good business practice to do business with people who are just out to make a quick dollar and will lie, steal, cut corners or misrepresent themselves in order to make that buck the fastest way possible and most of those dishonest people/companies have a clean BC. It is not good to do business with someone who is not qualified for the job either.
However this is nothing a little leadership change or attitude adjustment can't fix. It will work out with a little help from way up. Its happening. Cheer up.

 

[Evincere]

Tell it on the mountain, preacher man!! Amen, bruddah!!!

Quote:


Originally Posted by NEINAPPR View Post

I asked you in the previous thread what AMC your company utilizes and you failed to respond. Is there a reason you don't want anyone to know?

Any lender that does not demand their AMC hire locally qualified appraisers, pay them the going rate (determined by appraisers), and allow them ample time to do the actual work should not complain about quality when they receive the product.

Amen. The really hard questions go unanswered.

 

[J Grant]

Perhaps it comes down to the eternal question...does the end justify the means.

All these companies in such a rush to close loans or divest of property...is the whirlwind of speed to prevent anyone from looking too hard of how that is accomplished?

Bernie Madoff's data looked good, too good, as it turns out...(which is why he got away with it for so long). Anyone who questioned it was mocked...a popular strategy that works. The statements looked so good, he managed to avoid in depth audits for years, superficial audits passed with flying colors.

 

[Eli]

You know how it is with parents and children when the child has cost the parent a bunch of money due to foolishness or some other dishonest act. The parent doesn't want to punish immediately and in public especially if they think they could have prevented it somehow, but punishment/change usually comes and the severity of the punishment/correction usually is directly related to what it cost the parent. Sometimes it takes the parent a while to decide the best action if they are thinking clearly. just sayin...it ain't over yet imho. Most of our leaders in Washington and the regulators are very intelligent and didn't get there being a fool.

 

[Scott Kibler]

timd said, "Nothing that has been presented in this thread is actual, credible evidence that the VP of Loss Mitigation (a very smart guy with 30 years experience) at my company is incorrect when he tells me that BPO's generally work better than apprisals for this purpose. His conclusion is based not only based on his experience but actual studies that showed this to be the case."

In my market there is the 'go to girl' for BPO work, she sells them fast, puts everything at a 30% discount, and guess what?, they do sell fast. I don't see that is evidence of obtaining "market value" or "distressed value".

Just because BPOs (which are connected with a listing agent, who has a self interest in turning them over quickly, and the seller's interest is subordinated to the selling agents') is seen as 'better' doesn't mean a standard, full appraisal isn't an appropriate basis for the original financing of the loan.

When the folks valuing a property are the same ones selling the property, it would be surprising if the value and price were not similar. That's the reason independent appraisers are used for lending purposes in the first place. It's hard to fathom that so called smart VPs can't see that reasoning. I imagine they do but don't care. They need assets moved and they need documentation in the file that says they didn't get ripped off in the sale. Who cares if they did, it's not like it's their own money. Playing games with other people's money is what got them in that situation in the first place. Prudent lending and collection policies would have minimized the loses even given the economic crisis. But of course that would have increased expenses. How much money has been lost on stupid REO sales in the past few years? Any good appraiser or agent working distressed sales or claim cases, or any active RE investor, will have a ton of examples of this. Then again, maybe the smart VP does believe what he says. Being smart in the office surrounded with spreadsheets doesn't always translate to being smart on the street where those spreadsheet numbers are being generated.

 

[Eli]

When the folks valuing a property are the same ones selling the property, it would be surprising if the value and price were not similar. That's the reason independent appraisers are used for lending purposes in the first place. It's hard to fathom that so called smart VPs can't see that reasoning. I imagine they do but don't care. They need assets moved and they need documentation in the file that says they didn't get ripped off in the sale. Who cares if they did, it's not like it's their own money. Playing games with other people's money is what got them in that situation in the first place. Prudent lending and collection policies would have minimized the loses even given the economic crisis. But of course that would have increased expenses. How much money has been lost on stupid REO sales in the past few years? Any good appraiser or agent working distressed sales or claim cases, or any active RE investor, will have a ton of examples of this. Then again, maybe the smart VP does believe what he says. Being smart in the office surrounded with spreadsheets doesn't always translate to being smart on the street where those spreadsheet numbers are being generated.

Good points. The way I understand FNMA policies, if the appraised value and the first BPO vary more than a certain amount, they order a second BPO so that they have a disinterested BPO in the mix (may not be exactly right, but close based on my limited knowledge). Appraisers still rule and most realtors would tell you appraisers should be more accurate based on their training/experience even though RE agents don't like the results sometimes which experienced appraisers are used to. If you know an REO realtor in your market, they can tell you a lot more than I know. Heck there is a possibility I wouldn't like the appraised value of my house by the most qualified appraiser in the market, but I would sure rather have them than the least qualified/fastest whose fees are the highest.