Data Cancer found....

[J Grant]

I will remind you NAR don't like waivers.

Relax baby. Have a Merry Christmas!

NAR is just one small drop in a bucket that don't like waivers.

Merry Christmas to you too and everybody!

 

[Joyce Potts]

One has liability, one does not.

Would it be interesting to get the stats on how many appraisers were actually sued and lost the case having to pay damages to a GSE or lender. Once those credible stats are analyzed therein lies the better answer to the better question.

 

[J Grant]

I think the data cancer question is like the solar question. You want to be mindful of the possibility but if your comps aren't clearly showing a difference in pricing between the haves and have-nots then there might not be a difference in pricing. Arbitrarily blowing the possibility off isn't an acceptable solution and neither is arbitrarily applying an adjustment off the list. It's an opinion to be developed, not an assumption to be making.

My guess is that a waiver-induced spiff might show up in some datasets but not in others. The situation kind of reminds me of the foreclosure thingy - they don't always have an impact on the rest of the data but if you get a handful of real lowballs they can leave a mark. And if they add up to 30% of the market along with a different price they can create their own pricing tier and eventually run the market.

The other assumption about these that seems to be popular is that they run high. Again, the arbitrary assumption that will turn out to be untrue at least some of the time. They can run low, too. So that's another situation where it's an opinion to be developed specific to this assignment, not an assumption to make on the arbitrary basis.

But the REO's were clearly disclosed. That made it easy to see what impact they had on prices , and for comp purposes in some cases, whether to use them or adjust for them.

The same holds true for FHA and cast sales.

But with value acceptance/a WAIVER-based financing, it is not disclosed, so there is no way to run stats to isolate them to see what impact they had on prices - or secondary use for appraisals wrt identify it in a comp wrt any impact it might have had on that individual price.

WRT is running statistics or similar analyses on prices; you said to call the broker /agent - which means it adds days or a week to the process, and not all agents share the information, and they may not even know if the borrower got a waiver or not.

 

[Zoe]

But the REO's were clearly disclosed. That made it easy to see what impact they had on prices , and for comp purposes in some cases, whether to use them or adjust for them.

The same holds true for FHA and cast sales.

But with value acceptance/a WAIVER-based financing, it is not disclosed, so there is no way to run stats to isolate them to see what impact they had on prices - or secondary use for appraisals wrt identify it in a comp wrt any impact it might have had on that individual price.

WRT is running statistics or similar analyses on prices; you said to call the broker /agent - which means it adds days or a week to the process, and not all agents share the information, and they may not even know if the borrower got a waiver or not.

Memphis was bad in foreclosure world and mortgage fraud world. Me and several others were doing reos for them. We went to a meeting in Nashville one day with all appraisers and real estate agents.

Real estate agents were invited one day and appraisers (which some agents were also appraisers) invited the next day.

FNMA was doing both BPO from agents on the reos and appraisals on the reos. Appraisers were communicating constantly with the agent doing the bpos but no conversation on the final conclusion on the REO bpos or appraisals between the parties.

So FNMA called this meeting and said let us show you how much more accurate on the final sales price is with appraisers than bpos.

Agents didn't want to hear appraisers were better but agents are not unbiased parties. Appraisers are unbiased parties. NAR don't like waivers.

Agents don't want that noose on their neck.

 

[George Hatch]

But the REO's were clearly disclosed. That made it easy to see what impact they had on prices , and for comp purposes in some cases, whether to use them or adjust for them.

The same holds true for FHA and cast sales.

But with value acceptance/a WAIVER-based financing, it is not disclosed, so there is no way to run stats to isolate them to see what impact they had on prices - or secondary use for appraisals wrt identify it in a comp wrt any impact it might have had on that individual price.

WRT is running statistics or similar analyses on prices; you said to call the broker /agent - which means it adds days or a week to the process, and not all agents share the information, and they may not even know if the borrower got a waiver or not.

#sowhat

Neither you nor anyone else ever did answer the question I asked earlier: If you identify a high sale that was funded without an appraisal, what then? How does it affect your valuation? If/when identified, what can you do with that information besides complain about it?

If all your comps are pointing to a $400k value conclusion but you think they were skewed by a couple of waivers then what do you do? Say in your report that the $400k they are indicating to isn't the MV?

Of course you won't. You can't. Those sales went off at those prices whether you think they are reasonable or not. That's what makes the entire "Data Cancer" theme completely ridiculous - none of the people pimping this theme have thought it all the way through.

The obvious parallel is the ARM-driven pricing 20 years ago. The financing was ridiculous in terms of safe/sound but they were also so common as to not fit the definition of atypical or creative as that assumption is laid out in the definition of MV. So there's no adjustment to be made by the appraisers. The price paid between buyer and seller was the price. That's what has been happening all along with the waivers as well as all the other low LTV and all-cash sales. The price is the price whether you agree with it or not.

 

[Zoe]

In foreclosure and mortgage fraud world........, FBI camped out in memphis a long time. FDIC, etc.etc.

That was no doc loans that FNMA had to take back. All kinds of fraud on the mortgage documents.

Don't know of any bankers or mortgage brokers that got punished much.

 

[Zoe]

You never did answer the question I asked earlier: If you identify a high sale that was funded without an appraisal, what then? How does it affect your valuation?

If all your comps are pointing to a $400k value conclusion but you think they were skewed by a couple of waivers then what do you do? Say in your report that the $400k they are indicating to isn't the MV?

That is not position. My position is what if the waiver line is $325 to $475 and where the value is coming from on the waiver?

Surely you see the backlash coming from the borrower (consumer).

 

[Zoe]

You never did answer the question I asked earlier: If you identify a high sale that was funded without an appraisal, what then? How does it affect your valuation?

If all your comps are pointing to a $400k value conclusion but you think they were skewed by a couple of waivers then what do you do? Say in your report that the $400k they are indicating to isn't the MV?

Of course you won't. You can't. Those sales went off at those prices whether you think they are reasonable or not. That's what makes the entire "Data Cancer" theme completely ridiculous - none of the people pimping this theme have thought it all the way through.

The obvious parallel is the ARM-driven pricing 20 years ago. The financing was ridiculous in terms of safe/sound but they were also so common as to not fit the definition of atypical or creative as that assumption is laid out in the definition of MV. So there's no adjustment to be made by the appraisers. The price paid between buyer and seller was the price. That's what has been happening all along with the waivers as well as all the other lot LTV and all-cash sales. The price is the price whether you agree with it or not.

Okay, you got me. Notice how much information is withheld from licensed appraisal professionals. Surely you understand that is not kosher.

 

[Dublin ohio]

My position is what if the waiver line is $325 to $475 and where the value is coming from on the waiver?

On a purchase with a spread of that amount, it would more than likely result in a full appraisal being required

 

[Dublin ohio]

Okay, you got me. Notice how much information is withheld from licensed appraisal professionals. Surely you understand that is not kosher.

What information is that?