HVCC - Copy of Appraisal

[panappr]

I seem to get way more questions from private parties I complete appraisals for, as compared to reports completed for attorneys or lenders.

I agree with Lloyd, if we ever get busy again (swamped), there will be no (very little) time to field phone calls and play phone tag with home owners, who will then get angry an potentially be turning everyone in to the Boards with frivolous complaints or complaining to the lenders which will probably cost you clients.

 

[Marcia Langley]

Mike,

Actually we did talk about this some when the HVCC was first published.

I'd like them to change "any appraisal" to "any and every appraisal".

I think it is good that the borrower should get an automatic copy of all appraisals, regardless of whether the client charges for them. This status quo business about "in writing, within 90 days" has been sorely abused by clients especially when more than one appraisal is obtained and especially by MBs.

I also think most borrowers will waive the three days if it means they can close sooner. The same way most borrowers waive the three day "back out" provision.

One possible argument against that "prior to closing" part is for the increased potential for borrowers to claim they "used" the report to make a borrowing decision. Right now they only hear about the opinion of value prior to closing. But if they had a copy of the report before closing they could claim they "used" any/all parts of the report for making their decision.

I'd think that would open up potential for lots of silly stuff like relying on the neighborhood description or employment opportunities.

I think I'd be happier with the report(s) being provided at closing.

 

[DTB]

I personally think many borrowers will appreciate an appraiser telling them they are getting in over their heads. THe public is MUCH more aware now than at any time in the past ... its a very good provision of the HVCC and I support it strongly.

Early in a thread of the HVCC this was mentioned and discussed. Others brought out additional liability .. I personally think the liablity has been there all along.

This is supported by the tremendous increase of appraisals ordered by buyers PRIOR to making an offer and sellers getting PRE-LISTING appraisals. NOT.

Jim Klos nailed it on the button.

 

[c w d]

Seems like such an agreement would be illegal. How do you think such an agreement would be presented to the borrower?

In the same way that you waive rights to privacy when doing business with them. In the same way we waive our rights to copyright our appraisals in order to do business with them. How would that be any different?

 

[Brad Ellis]

Peter,

When I read that for the first time it became apparent to me that our liability will increase as soon as the HVCC is implemented. Currently the intended user is the client, typically the lender. But with the borrower basing their decision on your appraisal three days prior to closing it will by default make them a user as well. This may already be the case depending on how you interpret Cert. 21 of Fannie's 1004.

Very salient and important point. I do believe that appraiser liability will increase quite a bit and I'm not sure how or where cert 21 will be deemed to be unclear since it clearly states that the borrower may rely upon the appraisal.

If they get it before the loan closes then it will likely be deemed that they relied on it and the appraiser could be on the hook if it is not supportable.

In another string we have an appraiser now being sued over this directly and the court has apparently already found the borrower to be in standing since it is the borrower suing.

I'd surely not be without E+O in this market.

Brad

 

[Carnivore]

Does this also raise the liability of the BPO RE Agent and the AVM company?

I sure hope so!! I love to see an agent or two taken out in court!! It will end this nonsense.

FTR, I have absolutely no problem with this requirement. As a matter of fact I will be uncomprimising about this along with regulating AMC's as if they are appraisers.

 

[PropertyEconomics]

This is supported by the tremendous increase of appraisals ordered by buyers PRIOR to making an offer and sellers getting PRE-LISTING appraisals. NOT.

Jim Klos nailed it on the button.

No ... they relied upon the lender and the Realtor to tell them they were ok. How else would someone borrow money that couldnt be paid back? They relied upon the lies of others. If an appraiser lies to them now they will have the increased liability that they should have (the appraiser that is). Appraisals have historically been a safety net and can become so again. As I have posted in many threads ... historically the lender appraised the borrower and an appraiser appraised the real estate. Lenders are starting to do more borrower appraising as the lending programs for the nonqualified have gone away.
The public has become much more savvy in this market and realize they were led down a rosey path. WE have the opportunity to become ethical again, rid our business of the number hitters (or let the borrowers rid the market of them for us) and return to solid ground financially in the real estate market.
When someone is agreeing with borrowers at every step they had no reason to question things (even though all of us would agree they should have).
I remain confident borrowers will heed the advice of an honest and credible appraiser as to where they stand regarding a property they own or purchase. The question is ... will our profession become honest and credible again?

 

[Hamlet]

Sadly, part of this problem is the public, for the most part, are woefully uneducated in real estate and how the process works. Coupled with the fact this is a very emotional purchase and many people rely on the advice of the professionals involved. I see this as a positive step in educating the public. Together with changes as discussed to the HUD breaking down how the fees are paid, etc. in my opinion would go a long way towards educating the public and cleaning up this industry.

 

[DTB]

Would this be the same public that buys bottled water,which is worse than a lot of tap water, for higher prices than gasoline was? And then complains about the high cost of fuel!


Good luck with that.

 

[Webbed Feet]

To All,

I fear not! .... I am completely happy to let those opting to work to do a 1004 for $175 in 24 hours get completely sued right out this industry as far as I am concerned... I only want all, and any, AVM or BPOs used to have to be given in full to the borrower too! ... They'll all be so confused they won't know who to sue anyway for their own decision.

Webbed.

P.S. I have all of them sign an hold harmless agreement anyway at the inspection... I couldn't give a rip. Some of you worry too much and certainly don't take action to protect yourselves so you don't have to worry.