After reading Greg Boyd's thread on the recent assignment from RELS I am starting to be convinced that the few remaining mortgage brokers out there are more ethical and responsible than many of the lenders and their AMC partners.
Kevin,
One of the biggest failures of concerned appraisers has been to fail in the attempt to expose the appraiser coercion that exists within the AMC system.
IMO AMCs, MBs, and banks' commissioned LOs are roughly equal in their ethics (lack of) regarding appraiser selection.
The financial industry has succeeded in making the MBs the scapegoats.
And the banks are still getting away with portraying the AMCs as a coercion-free solution even after Cuomo exposed the rot.
At least with bank los and MBs the appraiser can control their own ethics one assignment at a time. With AMCs there is a contractural arrangement and a depersonalization that takes much of that control away from appraisers.
But the only solution is and always has been to take appraiser/appraisal selection/ordering away from any entity that has a financial interest in the outcome. That includes bank LOs, AMCs, and MBs.
As long as the banks continue to get their way and continue to hold this sort of economic power over appraisers there will be coercion and caving in to coercion.
But appraisers cast their votes in overwhelming numbers to preserve the ability for LOs to coerce them. They call it "protecting my ethical client relationships I have built up over the years."
Phooey.
My single biggest disappointment this year was the vast numbers of appraisers who signed the AlaMode petition. I have very high regard for Mr. Biggers and believe deeply that he has the financial success of his appraisers at heart and that he also is highly concerned about the ability of appraisers to perform ethically.
But his petition reflected what the vast majority of the appraisers wanted and that was to preserve the status quo of the coercion/caving paradigm.
Appraisers voted on the same side as the banks, AMCs, MBs, RE agents, congress, etc. That vote was:
"Please do not eliminate appraiser coercion, that is the only way I can make any money."
And that appraiser vote far outnumbered the signatures on our forum petition which simply calls for removal of comissioned entities from the process. Appraisers have proven that as a group they are no mre concerned about coercion than the clients are.
People can villify Cuomo all they want but there are some real appraiser independence protections in the HVCC. No, it's not perfect and yes, the obvious effort to drive business into AMCs was present.
But it also removed two groups of commissioned based appraiser selection and added specific accountability to AMCs, similar to what it placed on banks.
And, again, the MBs disappearance predates Cuomo's work and continues to escalate because it is the strategy of the banks. That was not the sole idea of Cuomo. That was the idea of the banks.
So the majority of all the participants are getting what they want. Including appraisers.
But the appraisers will end up with the thing they feared most. That being the driving of almost all the work to AMCs. Only without the potential protections spelled out in the HVCC.
