Departure -- Good Or Bad?

[Elliott]

They are actually thinking of removing depature from USPAP??
Inquiring minds want to know.

elliott

 

[Rich Heyn]

I'm curious as to your connection between the Departure Rule and the Appraisal Institute. Could you shed a little light on that?

 

[Ghost Rider]

Departure is the misunderstood child of USPAP, which is probably one of the main reasons why it is being removed from USPAP (And it's not just being talked about - it's gonna happen)

For one, I don't have a problem with departure - If it is understood, it lays a pretty easy ground upon which to do an appraisal. For all intensive purposes, the rule isn't changing, but the terminology is.

As for the idea that removing departure will put Skippy out of business, thats just silly. The same basic process will be in place, so they'll still be violating USPAP by backing into the cost approach, or for not developing the income approach when necessary, or for utilizing sales that are not comparables in their analysis. Changing terminology won't change the basic process.

 

[Tim Hicks (Texas)]

Apart from the departing part, which part of departure are you partial to?

I don't think it will cause a ripple in the pond. Many appraisers have no idea what departure is or could define it. It would not slow down anybody currently on skippy freight train, because departure is an unknown subject to them.

 

[Abester]

Lenders used departure in my area to try to reduce appraisal fees since the appraiser wouldn't have to do all the approaches to value. However, I pointed out that if the typical market participant would not rely on the approach, there was no point in including it in the appraisal except for those lenders that required three approaches. Net result - no change in fees.

It is interesting, however, that I still get calls from lenders (that require three approaches) that ask if using departure would result in my lowering the fee. I point out that it's their own dumb requirement to include three approaches, and if they'd quit trying to micromanage the appraisal process, they could save a ton of money.

 

[Elliott]

Rich,
The first time I ever heard of doing "less than a fully supported
appraisal" was a AI instructor who talked glowingly about
"new opportunities in providing clients with just what they
wanted." I thought it was a bad idea when I first heard it,
still do. I know of no other "profession" that choose to limit
itself, CPAs don't do limited audits or limited tax returns. Seems
to me a watering down of what you do.

elliott

 

[Rich Heyn]

Elliot,

So because a single AI instructor liked departure the AI must be behind it? Don't you think that's a bit of a stretch?

One instructor does not the AI make. You probably know this, but most AI instructors are simply practicing appraisers who teach on an ocassional basis. Their personal views on issues don't necessarily reflect the official position of the Appraisal Institute.

 

[liznindy]

If departure is not allowed, then how will the 2055 reports comply with USPAP?

 

[Robert Anderson]

This poll is confusing unless one has an understanding of changes in USPAP that the Appraisal Foundation is currently considering. These changes are embodied in a Second Exposure Draft on proposed revisions to the Uniform Standards of Professional Appraisal Practice, which can be viewed in the following PDF file:

https://www.appraisalfoundation.org/html/PD...s/Exd2Scope.pdf

These changes are summarized by the Appraisal Foundation as follows:

The major thrust of the Exposure Draft is a proposed conceptual shift of USPAP from a more complete set of standards that appraisers may or may not depart from, to a core set of minimum standards that appraisers must always comply with. Thus, change would occur by replacing the current DEPARTURE RULE with a set of mandatory minimum standards. This conceptual shift would also require a number of other changes as set forth in the Exposure Draft, such as: elimination of the labels complete appraisal and limited appraisal and the labels binding requirements and specific requirements; introduction of the SCOPE OF WORK RULE; and modifications to STANDARD 1 (other Standards will undergo similar changes)....

Everyone agrees that USPAP needs to be simplified, but I am uncertain if the proposed changes will accomplish this. Hopefully--and almost certainly--the people who are making these changes are smarter than I am.

Bob Anderson

 

[The Bob]

The fact they are removing departure is one small sign that intelligent life exits within the appraisal community. Scope of work is a much better way of addressing the "issue".

What is the logic in trying to explain to a client that you have "departed" from something that most appraisers can't agree on? :lol: