Data Cancer found....

[George Hatch]

I disagree that it will be mostly because of appraiser data. What makes you think this?
It will mostly be because their AVMs don’t account for non-quantitative elements.

Appraiser data is collected for the intended use in an appraisal assignment, not an AVM. If the GSEs want to misuse appraisal data for other purposes without due diligence, that is on them.

I completely agree that the GSEs skip the appraisal at their own risk. Full stop.

But if they do end up having problems which are attributable to the appraiser data that doesn't exactly function as a ringing endorsement for relying on the appraisals into which the appraisers are inputting that info.

Likewise, if they do have problems with AVM-backed waivers nobody is going to feel sorry for their losses, least of all the appraisers.

 

[CGinMN]

Well you’re just wrong that it will be because of appraiser data. It will be because AVMs aren’t good at valuing certain properties.

 

[CGinMN]

GSE AVMs aren’t using appraiser comp selection as a guide for AVM comp selection, and they’re not using appraiser adjustment rates as a basis for AVM adjustment rates. They think they’re better than appraisers at both of these things.

 

[J Grant]

Plus, the AVM is just the range - and since we don't see it, we have no idea how wide it is - 200-250K? Or 210-230K ?

In any event, the AVM is a glorified comp check - will the value comp out?

The point value itself for the WAIVER is selected by either the lender or it is the SC price. All it has to do is fall within the AVM range,

 

[George Hatch]

GSE AVMs aren’t using appraiser comp selection as a guide for AVM comp selection, and they’re not using appraiser adjustment rates as a basis for AVM adjustment rates. They think they’re better than appraisers at both of these things.

My point is that they *can* see what the other appraisers have thought about this property in the past. If they're not already using the additional info then it's just a matter of time before they add that analysis , even if only as a backstop or abundance of caution. It don't cost them extra.

And sure, there will be a certain percentage of all SFRs which would never fit the AVM program anyway. Not to mention how many borrowers will never fit the waiver program regardless of the property values. The GSEs will still need appraisers for those for the forseeable future.

 

[Mejappz]

I can't wait until the next show is released!

 

[George Hatch]

LOL

Yeah, I don't have to wonder where he got his me-too "shill" talking point from.
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Just out of curiosity, do you happen to know if his property is anywhere on that map at all? Or are you just taking his word for it? Because to the best of my (admittedly limited) knowledge it isn't. If he owns something on that map then I sure didn't see it.

If his property isn't on that map then that makes his "doxxing" claim just as factually untrue as your "shill" allegation.

 

[alebrewer]

how the F do they know it is a market value sale if they are lending 97%? I mean what benchmark gives them the value? This is like lending 1975 when you vetted the borrower without a serious clue as to the value of the collateral.

I don't disagree with the bolded piece - using waivers does, IMO, give the vibe that the collateral piece isn't really that important. And at the end of the day - it's not. Unless the borrower defaults - then it is. Current mortgage default rates are in the ~ 2% range, so maybe they're right - the collateral piece isn't really that important, and any perceived loss from default risk is mitigated by the GSE's magic 8 ball. Bada Bing, Bada Boom.

 

[George Hatch]

Like I have said before, any program can work when times are good. It's when times get hard and these lenders start taking losses that we find our how well or poorly these programs have worked. Valuing properties also becomes a more critical function of the underwriting when the value trends are declining. If they needed a good appraisal when values were increasing then they REALLY need a good appraisal when the values are decreasing.

 

[PushinValue]

Just ask the seller or buyer's agent. I previously shared a list of multiple properties within the same PUD that received waivers, and all of them sold above market value.

I called on an outlier sale for details trying to figure out what was going on. I asked the agent what it appraiser for. Response. Waiver. I laughed out loud and stopped myself quickly.