Deal Nears to Curb Home-Appraisal Abuse, Coumo, Freddie Mac and Fannie Mae

[Pamela Crowley (Florida)]

PM sent to me to post by someone that cannot post due to their job:

For obvious reasons, I'm not getting into the discussion but someone should get out and say ONE thing.....

The WaMu debacle happened BECAUSE they got rid of their in house review panel, and went to the AMC model. The in house team they had was top notch, good quality people. They went to an "independant" AMC, and strong armed them.


Home appraisals would have to come from assessors that do not have formal ties with a lender or mortgage broker, according to sources familiar with negotiations over a deal that could be finalized as soon as Tuesday.

Last time I checked, not many brokers had "formal ties" to any appraisers - They simply had a nice friendly relationship. I don't think I need to say more about that......

As far as the idea of ending the in-house appraisal concept, thats another stupid idea. The only one I know of who has done it badly is Countrywide. You should hear the horror stories that come from the Landsafe/CFC staff appraisers. Pressure for value and service. BofA - good rep; World/Wachovia - good rep; Former WaMu prior to them firing the ENTIRE staff - good rep......

If Fannie/Freddie REALLY want to fix their problems, they need to actually do something. Do you know there is no "front end" due diligence done to anything sold to the GSEs?? That they never look at the appraisal/loan file unless something goes wrong??

And people wonder why the GSEs say "we didn't know" - They really didn't......

 

[tjcou812]

I'm not sure what to think until the final decision has been made. I do think that Fannie Mae and Freddy Mac and every one else involved need to take a close look at all the economic factors like how many appraisal companies, mb owners, lenders will either have to close their doors or have major layoffs etc. that will occur when they make a deal like they are talking about. This will also affect the economy. Were talking about a lot of lives that would be effected on this deal. Just a thought.

 

[panappr]

I guess we will all be working for an AMC sooner or later at half price, or maybe I'll just call myself an AMC, and everyone can use me.

 

[Marcia Langley]

Does anyone know the status of the negotiating process itself?

I glean from the sketchy reporting that Fannie is the one offering the initial proposal and Cuomo is the one considering the offer. Presumably, Freddie is getting a chance to chime in before anything final occurs.

The first reporting on Tuesday said it was thought it would be finalized on Monday but was now expected to be finalized today (Tuesday).

It hasn't happened yet and I'm guessing they are getting massive amounts of lobbying from many quarters (including me ). What they end up with may look very, very different than the initial offer.

In the mean time, I have heard that Fannie has already sent out notices to lenders that they intend to implement at least part of what they proposed on September 1.

Does anyone have more insight to the negotiating process?

 

[Bigrock]

Just wait till you see the Zaio approach as THE ANSWER TO THE PROBLEM...What a joke...

I do agree when the lenders did away with their in house people, and went to treating AMC as a profit center, that is when the problem started...

 

[Ms. Janet]

I just don't see how this affects Cuomo and eAppraiseit at all?? Seems like the only AMC it hits is Landsafe.

 

[Workbox]

Just wait till you see the Zaio approach as THE ANSWER TO THE PROBLEM...What a joke...

I do agree when the lenders did away with their in house people, and went to treating AMC as a profit center, that is when the problem started...

So true, I was on very good rotation list, no pressure and time.

 

[Pat Butler]

Just another situation where they are ignoring the obvious solution. Sue the lenders and AMC's who are in possession of bad appraisals, regardless of how they ordered them in the first place. If you hold the lenders, and their stockholders, responsible for bad appraisals then they'll eventually come up with a way to ensure good appraisals.

This is just another run around where people are listening to the same parties who created the problems. Makes me want to throw up when I hear a rep from the title/AMC side making any sort of suggestions.

 

[Lost Cause]

Not A Chance

If you hold the lenders, and their stockholders, responsible for bad appraisals then they'll eventually come up with a way to ensure good appraisals.

So true, Pat. It's way too simple and effective, so it'll never be implemented.

 

[Marcia Langley]

On the other hand massive bankrupt-producing fines and jail time usually only create a few scapegoats and don't engender meaningful reform.

Of course, if you don't get meaningful reform, anyway, you lose all the way around.

But I'd trade off nailing down some criminals if something truly meaningful for appraiser independence resulted from negotiations.