Could we do without?

[Roy Courtney]

My office does not accept any review work. There was a time in the past that we did. My experience was that the lenders only sent assignments out for review when they suspected that the appraisal was flawed. (and they were usually correct) The lender always expected the "review" to be prepared for a cheaper price than the original appraisal. However, in most cases these reviews resulted in the need to completely prepare a new appraisal with the result being a lot of work for a lesser fee. The next problem is in my area I personally know most of the appraisers and consider many of them to be friends. The lenders we had prepared reviews for ALWAYS sent a copy of the review along with the name of the reviewer to the original appraiser and requested their response. Many times this created problems between friends.

Like I said, I know most of the appraisers in my local area. I keep a list of appraisers with their phone numbers on my desk. Yes, I know that every market is different but we are constantly referring appraisers to clients and taking clients that are referred to us by other appraisers. At a minimum I would estimate that I have prepared 30 or more appraisals this year that had been referred to me by fellow local appraisers. I just consider it to be a business decision.

 

[Carnivore]

Again, a review is a cop out, ordered to get a discount over the cost of an actual re-appraisal.

I agree totally. In the context of appraisal reports prepared for the purpose of lending with future purchase by FNMA, Freddie Mac and for that matter any secondary market for residential lending.

So in that context; for a review the review appraiser must always verify pertinent facts( Std 1; development). Either present or not present in the original report. That reviewer is now halfway to an appraisal report.

The second half involves std 2. The problem is by agreeing or disagreeing with a opinion of value on the original report then at that point you have prepared an appraisal(per USPAP). Its the only way I see of determining a credible value(or range of value). You did this by doing your own appraisal, per std 1 & std 2.

That's the problem with residential Lending reviews. They always want your agreement or disagreement of the original appraiser's point opinion of market value. I suppose you could state; "I don't have a reason to disagree with the original opinion of market value." I think at that point you could also say that the original opined value falls within the indicated adjusted range of value.

They don't want you to opine your value as a reconciliation of the facts unless you disagree. If you agree, then you have by default opined exactly what the original appraiser opined.

That raises the question; Can you opine a different market point value or range of value, but still agree with the original appraisers opined market point value.

I say you can! I have done this to their much disconcertion just that. I have never backed down from that position. I do often give a credible range of market value and then agree with the original appraiser. They swallow that a lot better, but still express there dislike of the range.

Caveat: If the original appraiser did a good job of explaining his/her conclusion in the reconciliation and it was convincing then I more likely than not agree to the original appraisal reported point market value.

FTR, I hate reviews and don't get request very often because my fee is large.
Then I will take the review because the bucks make it worth my time.

I may have some flawed thinking above, its always helpful here for me to read disagreements with my methodology. :new_all_coholic:

 

[Delta85]

I rarely if ever do any review work as I totally agree there seems to be a misconception in lending circles that a review should be billed at a portion of what a full fee would be. I think they are full fee requests and hold out for that whenever I am asked to perform one.

 

[Deleted member 128537]

I charge the same for reviews as appraisals.

I do not review appraisals done by people I know personally because I just think it is unethical due to bias.

I really want the appraisal I am reviewing NOT to have issues. It's much less work.

I look for the really big errors: Methodology and comp selection, or large adjustments that are not supported.

 

[JamesRockford]

I charge the same for reviews as appraisals.

I do not review appraisals done by people I know personally because I just think it is unethical due to bias.

I really want the appraisal I am reviewing NOT to have issues. It's much less work.

I look for the really big errors: Methodology and comp selection, or large adjustments that are not supported.

Lenders hate to pay for reviews because it comes out of their pocket, so the likelihood of "no issues" is about 1%, maybe.

If the appraisal looks too good to be true as far as the review goes, you'd better dig deeper.

 

[Michigan CG]

I get few reviews because I charge too much (in their opinion). The ones I get are always horrible being over-inflated by 25-50%. The last one I did the gal really tried hard to inflate the value of a 1970's subdivision house with comps on acreage, a comp on the river, a comp that was significantly larger and another one I can't remember.

Despite her efforts and ignoring the subdivision sales she was only over about 10%. I looked up her license and she was now inactive.

 

[PL1957]

like I said, Who reviews the reviewers?

On the commercial side, most of the larger banks have now instituted quality control reviews of their internal reviews. The bank reviewers HATE IT. I, on the other hand, am quite amused that the shoe is on the other foot ...

 

[George Hatch]

If the reviewers on either side are acting out of line then it's going to be an adversarial situation regardless. If they're all trying to act within the actual scope of what review is supposed to be about then it will look more collaborative.

IMO the only good reason for appraiser-reviewer animosity is if one or both of them are *acting* out of line relative to their respective roles.

 

[Delta85]

On the commercial side, most of the larger banks have now instituted quality control reviews of their internal reviews.

Well then the next question is who reviews the reviewers of reviews? LOL!

 

[JamesRockford]

Well then the next question is who reviews the reviewers of reviews? LOL!

Somebody in India....