• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Desk Appraisal is killing deal - 1 day before signing - HELP!

Status
Not open for further replies.
My point was strictly for the OP. And I was attempting to write it to his level of understanding.

We appraisers here all understand there are different types of value we can appraise too and appreciate the subtle nuances of each. But it seems likely that the trouble this guy is having is that one appraiser was appraising his property according to the "Definition of Market Value" described on Page 4 of 6 of Fannie Mae Form 1004 March 2005 (happy webbed?) while the appraiser that performed the Desktop may have been appraising to some non recognized "scared witless risk adverse banker with tight undershorts market value".

I've had three appraisals in the last couple months where my supervisor has heard from the person taking the loan that some "reviewer" cut the value and they couldn't get the loan or had to supply more down or pay points or something. I've gotten copies of two of these "reviews". They're typically a half paragraph that summarizes your appraisal in detial [chortle], another sentence or two that talks about risk due to poorly supported adjustments or dissimilar comps or something [dare you to find better comps or more support], a vague reference to an AVM, an then an OMV 10 or more percent less. Reading these things it sure seems that the reviewer is less driven by a coherently expressed opinion of the property than a mission....to cut, to reduce risk, (to violate the Ethics Rule) and to potentially squeeze some extra coin of of the person taking the loan on a refi or the to get the seller to buy them some insurance with a deep price cut. Its good business for the Bank for sure, but it ****es me off that they seem to be using a sham appraisal produce to do it so appraiser's take the heat. It would also be fair if they said up front, "Hey, we're scared, we're not going loan on full market value as described in the "Definition of Market Value" described on Page 4 of 6 of Fannie Mae Form 1004 March 2005. We're only going to loan on 85%." Then at least buyers and refi'er would't get sucked into the process assuming they will get fair consideration.
 
<.....snip.....> that its entirely possible that the Appraisal and the Desktop are responding to different ideas about value <.....snip.....>

The what and the what? ... You mean "The" first appraisal and "The" second appraisal? Because last I checked they are both "appraisals." And do you care to explain why the same lender involving a mortgage, for a sale transaction of a SFR, would order two separate appraisals that employ two different definitions of value? Highly unlikely...

Undoubtedly the scopes (manner in which the two separate appraisals were completed) of the two appraisal assignments were very different. I seriously doubt the definitions of value used were and expect they were both identical definitions of "Market Value." Not, "Fair Market Value."

:nono:

However, it was still a nice graph...;)
 
That is better Meta. But now you are disparaging the process of reviewing when we have no reason to believe other than that it is the process itself that is to blame, and not the reveiw or reviewer. I appreciate you have seen some bad examples of review work. Given I think 50% to 75% of all appraisers should have their licenses or certifications revoked, that would not surprise me. But here we maintain wording like "the reviewer cut the value" when that is impossible. All a reviewer can do is perform their own real estate appraisal and reach their own conclusion of value. That is not "cutting" the value of anyone. It's a totally different appraisal done by a completely different appraiser, using a different scope of work. And this is what we need to make sure the public, lending, and our trade itself understands.
 
Because last I checked they are both "appraisals." And do you care to explain why the same lender involving a mortgage, for a sale transaction of a SFR, would order two separate appraisals that employ two different definitions of value? Highly unlikely...

You need to get out more then. BoA seems to be doing this regularly through Landsafe. They order an full 1004. The 1004 comes in, then they pay a Landsafe reviewer to do "LARA" or some such kind of hybrid review/appraisal/risk eval document (call it what you will) on it. The value gets cut. Maybe there's still enough value to go through with the loan, maybe not. It truly seems like the bank is using the first "full" appraisal, to get a value for the proeprty, and then using the second desktop review product to arrive at some sort of value that incorporates the market value from the first appraisal but tempers it with evaluation of risk. The couple of conversations my supervisor has had with these reviewer its clear they're very focused on "risk" and use the word a lot. My understanding of review practice is that "risk" is not one of the things typically considered. The 2000 form asks if the information is "complete and accurate", not if its risky and poorly supported.
 
.........that they seem to be using a sham appraisal produce to do it so appraiser's take the heat. It would also be fair if they said up front, "Hey, we're scared, we're not going loan on full market value as described in the "Definition of Market Value" described on Page 4 of 6 of Fannie Mae Form 1004 March 2005. We're only going to loan on 85%." Then at least buyers and refi'er would't get sucked into the process assuming they will get fair consideration.
That is something that the general public needs to know and I wonder if the homeowners Realtor advised them of that risk? They can't continue believing that everything is OK and what the Media Hypes about. If I was the home owner in California, I would get what I can and Run, before it gets worse.
 
What is enhanced DR? How should I charge? Is that real the lender always can choose lowest no matter what. I am a green reviewer any one can help?
 
Careful, Metaphoric. I think you just did an appraisal.
 
Nah, not even close. I never advanced or endorsed any value. I just talked about the difference in 2 values and why that difference might exist, and I provided some market data and analysis.
 
You need to get out more then. BoA seems to be doing this regularly through Landsafe. They order an full 1004. The 1004 comes in, then they pay a Landsafe reviewer to do "LARA" or some such kind of hybrid review/appraisal/risk eval document (call it what you will) on it. The value gets cut. Maybe there's still enough value to go through with the loan, maybe not. It truly seems like the bank is using the first "full" appraisal, to get a value for the proeprty, and then using the second desktop review product to arrive at some sort of value that incorporates the market value from the first appraisal but tempers it with evaluation of risk. The couple of conversations my supervisor has had with these reviewer its clear they're very focused on "risk" and use the word a lot. My understanding of review practice is that "risk" is not one of the things typically considered. The 2000 form asks if the information is "complete and accurate", not if its risky and poorly supported.

Meta, it would make an interesting thread of someone obtained a copy of a LARA report, 100% of the entire thing, and posted it. Then we could tear into what is really happening for any public member to read. I'll say this, from what I recall ....... the sentence almost at the bottom of the PDF document link is what I took to explain about everything that is going on a long time ago...

http://www.landsafe.com/landsafe/value/LSA0007.pdf

Bluntly said, as long as the original appraisal is ordered through Landsafe a LARA may not be needed. So maybe you are correct, maybe the scope has been intentionally tampered with to mess with any loan originator that fails to order an appraisal through Landsafe.

Get a complete LARA report for us. Start a new thread. I'm sure many here would enjoy ripping apart what is being done and placing it in a proper real estate appraisal context instead of a lending propaganda one.
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Back
Top