Data Collectors or Home Inspectors?

[djd09]

Appraisal Data Collectors: What You Should Know​

What has changed in the appraisal data collection process?​

Some appraisal management companies (AMCs) now send “data collectors” to take video, pictures, and measurements of properties instead of an appraiser. They may use cameras or applications from smart phones. The data is then sent to the AMC who determines whether an appraisal is necessary or whether the financier will grant a waiver to the appraisal requirement. If an appraisal is required, the AMC shares the data with an appraiser who generates the appraisal.

When did this separation of duties begin?​

Traditionally, appraisers collect all information they use in an appraisal. Beginning in 2019, Freddie Mac, a quasi-government company that guarantees and helps fund mortgages for home purchases, started a program called property data report (PDR)(link is external) and a pilot program to research the efficacy of separating the data collection from the appraisal. Fannie Mae has since followed suit.1 These pilot programs are not nation-wide, yet, but they will likely expand. The intent is to make data collection more standardized, to reduce costs, and to further ensure impartial and objective appraisals.

Who are data collectors?​

Data collectors(link is external) are persons hired by an AMC, not the appraiser. To date, there are no federal or state regulations on data collectors, though Freddie Mac requires that they have a background check, but does not specify what that should be. Appraisers are required to have a background check, and REALTORS® have the NAR Code of Ethics, local board oversight, as well as a tight-knit community of professional colleagues to observe and censure bad behavior. This lack of oversight for data collectors means that the consumer cannot assume a minimum level of professionalism and should vet the data collector who will enter their home.

REALTORS® as data collectors?​

Some companies have recruited REALTORS® to act as data collectors. This provides an opportunity for some extra income and leverages the agent’s market expertise. However, legal grey areas remain and are not yet clear. Before entering work as a data collector, one should investigate these legal questions and discuss with their broker:

• Does applicable state law allow the agent to enter a home to perform data collection pursuant to the broker’s license or otherwise?
• Could the agent or broker be legally liable if the data is not collected correctly, whether with a third-party application or not?
• Should an agent that is a party to the seller or buyer in the transaction be allowed to collect the data?
• Does the agent’s insurance provide coverage for data collection work?

What consumers do if they are expecting an appraisal:​

• Ask their lender whether they use an AMC and if the AMC will use a data collector or not?
• State laws require background checks or particular background information for appraisers, but the same is not true of data collectors. Ask your lender whether they or the AMC have a policy requiring updated background checks of data collectors and whether one was conducted.
• Finally, accompany the data collector as they document your property and ask for a copy of any videos, pictures, or measurements
• And always remember your safety tips!

These are just a few, but not an exhaustive list of ways you should protect yourself and your privacy.

Appraisal Data Collectors: What You Should Know

Some appraisal management companies (AMCs) now send “data collectors” to take video, pictures, and measurements of properties instead of an appraiser. Learn more about what has changed in the appraisal data collection process.

www.nar.realtor

 

[George Hatch]

The AMC isn't the party that decides which form of valuation the lender is going to use in their decision making, nor is the AMC the party which decides whether or not to engage a 3rd party inspection.

Render unto the lenders that which are their actions and that which is their responsibility.

 

[djd09]

the AMC is an agent of the lender...you think an appraiser would know this

 

[George Hatch]

The AMC still doesn't make any of these decisions other than finding the appraisers who will work for the lowest fee. I would expect you as an appraiser to understand this.

 

[djd09]

i dont know what the unethical stakeholders do or dont do...

 

[djd09]

Property Data Collector Independence Requirements

These Property Data Collector Independence Requirements (PDCIR) set forth standards to safeguard theindependence, objectivity, and impartiality of property data collectors and other Independent Partiesthroughout the property data collection process.Property data collection is the act of physically or virtually observing and reporting property characteristicsin a fact-based manner. Property data collection is not an appraisal in that it does not involve thedevelopment of an opinion of value.For purposes of these PDCIR, the term “Independent Party” refers to the property data collector, property datacollection company, any entity or person related to the property data collector, property data collectioncompany, or any other party that is part of the property data collection process. When appraisers, appraisalcompanies, or appraisal management companies are engaged to perform the property data collection processthey are Independent Parties. Compliance with these PDCIR is the responsibility of the Seller.I. General RequirementsNo person is allowed to influence or attempt to influence the observation, reporting, result, or review ofa property data collection through coercion, extortion, collusion, compensation, inducement,intimidation, bribery, or any other manner including but not limited to:

I. General RequirementsNo person is allowed to influence or attempt to influence the observation, reporting, result, or review ofa property data collection through coercion, extortion, collusion, compensation, inducement,intimidation, bribery, or any other manner including but not limited to:

https://singlefamily.fanniemae.com/media/36476/display

 

[djd09]

Data Collectors and Real Estate Appraisal Companies​

QUESTION: One of my residential listings is being purchased by an investment firm. The transaction was going fine until the buyer agent asked me when the “data collector” could come inside the home and gather appraisal information. I asked the buyer agent whether the data collector is a licensed appraiser, and he said “no.” I informed the buyer agent that the data collector could come in the home, but only if the buyer agent attended the inspection. The buyer agent got very angry and accused me of creating unnecessary work for him. Can the buyer agent refuse to attend the data collector’s inspection?

ANSWER: We do not believe so. We have previously written here that buyer agents must attend all inspections with two exceptions: (1) inspections by licensed appraisers; and (2) inspections that do not require interior access of the home. Since the data collector in your case wants to come in the home and is not licensed, neither exception applies.

The National Association of REALTORS® has recently written an article about data collectors and their role in real estate appraisal management companies (“AMCs”). NAR’s article explains that in some transactions, lenders may hire an AMC to perform appraisal and data collection services. The AMC usually determines whether an appraisal is necessary once it looks at the data, and then it makes an appropriate recommendation to the lender. By separating the appraisal from the data collection process, lenders and buyers hope to save on appraisal costs.

Article 2 of Chapter 93E of North Carolina’s General Statutes regulates AMCs and states that they must be licensed and registered with the North Carolina Appraisal Board. AMCs can be subject to discipline for violating Chapter 93E or the Board’s rules, which are located in Subchapter 57A of the Administrative Code.

However, no part of Chapter 93E requires an AMC to perform background checks on data collectors, even though many AMCs do so anyway. Thus, there is no guarantee that a data collector has passed a thorough background check similar to a licensed appraiser. This makes the buyer agent’s attendance at the home just as important as when any other unlicensed person conducts an inspection, such as an unlicensed contractor/handyman or the buyer themselves in most cases. If the buyer agent in your transaction will not attend the data collector’s inspection, then they may be in violation of the Real Estate License Law (Chapter 93A of North Carolina’s General Statutes).

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This article is intended solely for the benefit of NC REALTORS® members, who may reproduce and distribute it to other NC REALTORS® members and their clients, provided it is reproduced in its entirety without any change to its format or content, including disclaimer and copyright notice, and provided that any such reproduction is not intended for monetary gain. Any unauthorized reproduction, use or distribution is prohibited.

 

[djd09]

Property data collectors​

Property data collectors only visit a property and gather standardized data points and take photographs to support their observations. For example, a property data report will include:

• Building materials used, like brick or siding, roofing, and flooring
• Type and number of rooms, like bedrooms and bathrooms
• Obvious safety and structural concerns
• Property and building measurements
• Presence of outbuildings, fencing, or other elements

They don’t perform additional property research, such as a market analysis. They report facts and observations about a property and don’t give opinions.

Appraisers can work with property data collectors​

Property data collectors will never replace the experience, knowledge, and insight that appraisers bring to the able. But the two roles can work together. Property data collectors can provide their reports to an appraiser to use as foundational information in a desktop, hybrid, or bifurcated appraisal. This saves the appraiser time and allows them to focus on the more challenging aspects of a project, like performing research and in-depth analysis.

Also, trainee appraisers can benefit from becoming property data collectors. While this work wouldn’t count toward their experience hours, it does give them the opportunity to get more comfortable going on sites, knowing what to look for, and making thorough observations. Even better, it gives them additional income as they work toward their career goals!

https://www.mckissock.com/blog/appraisal/appraisers-and-property-data-collectors-how-do-they-differ/

runners...

 

[chad hampton]

Imagine having such a limited understanding of the profession that you don’t think opinions are developed during the appraisal inspection.

 

[George Hatch]

Said nobody.

Imagine having such a limited understanding of whose opinion you're using that you think you can develop an opinion of the subject's value without having your own opinion of its attributes and comparability. Regardless of what information you used to develop that opinion.

If you read the report and come to the conclusion that the subject is Q3/C3 then whose opinion is that? Your own opinion or someone else's opinion?

What exactly are you doing, opinion wise, when you read someone else's appraisal report as a reviewer and either agree or disagree with its various elements including the value conclusion?
What are you doing - opinion wise - when there is no interior inspection or no physical inspection at all, by anyone?