Hybrid Appraisals

[Ricky LaFleur]

The value of something lies in the eye of the beholder. If they think its sufficient for their use then that's all the sufficient it has to be.

It might be fair to say they're wrong in their decision making but when it comes to judging "meaningful to intended users" it is still the users who decide what is/isn't meaningful to their usage. Not you and not me.

If you were taking a test on the material that would be the correct answer. Your ritual incantation of "there is only one appraisal under the heavens and the 1004 is it's name. Blessed be the 1004" would be an incorrect response on a test. Even if you said it in Latin. Or Arabic.

Obviously the largest users of appraisals are incentivized to create/use alternative (i.e. cheaper) products for valuation. If you're talking about appraisal products (the only part we're generally having control over), while some work products may be meeting expectations of intended users, what does it mean when a large portion of the appraiser's peers' actions are to reject a work product the intended users are asking for because they don't believe it to be appropriate? It isn't only the users who decide what is/isn't meaningful or appropriate in an appraisal. Unless you're talking about AVM's or borrower value estimates or some other method they're considering that isn't an appraisal. I don't think relying on borrower guestimation and waivers is always prudent for the tax payers, but that isn't something I can control either.

 

[chad hampton]

The value of something lies in the eye of the beholder. If they think its sufficient for their use then that's all the sufficient it has to be.

It might be fair to say they're wrong in their decision making but when it comes to judging "meaningful to intended users" it is still the users who decide what is/isn't meaningful to their usage. Not you and not me.

If you were taking a test on the material that would be the correct answer. Your ritual incantation of "there is only one appraisal under the heavens and the 1004 is it's name. Blessed be the 1004" would be an incorrect response on a test. Even if you said it in Latin. Or Arabic.

I get all of that. But the users are backed by the US taxpayer. So it’s not really their money they’re are playing with.

I suspect if it were, they would make accurate valuations a legitimate priority. Like my private money lender clients do.

 

[djd09]

yeah the 1004 is rubbish....certs and all...and it is still not good enough for fannie and no form will ever be...the independent appraiser should create their own forms and watch the shills cry then

 

[djd09]

I get all of that. But the users are backed by the US taxpayer. So it’s not really their money they’re are playing with.

I suspect if it were, they would make accurate valuations a legitimate priority. Like my private money lender clients do.

we could do it like the scum bag mortgage broker appraiser....and just write in a number

 

[chad hampton]

we could do it like the scum bag mortgage broker appraiser....and just write in a number

And that’s what I mean, that’s what the users of appraisal services have always wanted. It doesn’t mean they get it. I don’t do as much engineering work now as I used to, but the users of engineering services always wanted everything to pass inspection. They didn’t always get what they wanted. A professional service does not always give good news to the user.

If you wanna go be a salesman, then you can always give good news to your client.

 

[George Hatch]

I get all of that. But the users are backed by the US taxpayer. So it’s not really their money they’re are playing with.

I suspect if it were, they would make accurate valuations a legitimate priority. Like my private money lender clients do.

I agree completely, but [taxpayer backed] speaks to political decisions which have been made much higher up the foodchain than at the appraiser/intended user relationship. Moreover, not all mortgage lenders have that backing.

IRL the bankers will continue to do whatever the govt doesn't prohibit them from doing. It is only in some utopian fantasy comic book that the bankers will choose to take an unrequired higher path in the name of altruism.

You can test the principle by swapping the variable. If it wasn't a mortgage lending situation but some other use then do you think the conventional 1004 would still be the only expression of professional practice across all uses and users? Not if you're answering that question honestly and objectively.

Speaking of the conventional 1004, I invite you to consider the point that the 1004 is also completely inadequate for certain users/uses. It's not some gold standard of appraisal practice which itself is always beyond criticism.

 

[George Hatch]

Obviously the largest users of appraisals are incentivized to create/use alternative (i.e. cheaper) products for valuation. If you're talking about appraisal products (the only part we're generally having control over), while some work products may be meeting expectations of intended users, what does it mean when a large portion of the appraiser's peers' actions are to reject a work product the intended users are asking for because they don't believe it to be appropriate? It isn't only the users who decide what is/isn't meaningful or appropriate in an appraisal. Unless you're talking about AVM's or borrower value estimates or some other method they're considering that isn't an appraisal. I don't think relying on borrower guestimation and waivers is always prudent for the tax payers, but that isn't something I can control either.

WRT "appraisers peers", those peers do not consist of the entire population of appraisers. The definition and intent is very specific and has been since the inception of the SOWR:





Meaning, the user group consists of other users engaging the same type of assignment, and the peer group consists of other appraisers performing the same type of assignment. Not the appraisers who don't perform such assignments. Their expectations don't count.

 

[djd09]

And that’s what I mean, that’s what the users of appraisal services have always wanted. It doesn’t mean they get it. I don’t do as much engineering work now as I used to, but the users of engineering services always wanted everything to pass inspection. They didn’t always get what they wanted. A professional service does not always give good news to the user.

If you wanna go be a salesman, then you can always give good news to your client.

they turned a broken and corrupt system into a larger broken and corrupt system...try to low ball three appraisals to the unethical stakeholders and find out what happens

 

[George Hatch]

I do different SOW for different users/uses. Heck, appraisers who perform FHA or ERC work are using a different SOW than the appraisers hacking out 1004 widgets for Rocket Mtg. For that matter, "enough" for Rocket isn't necessarily enough for every other lender. And vice versa. I see a lot of complaints about AMCs adding their own requirements, in which case the same lender might be getting a different workproduct from one AMC to another, or a different workproduct from AMC engagement vs direct engagement.

If it's even possible for "different" to exist in the marketplace then USPAP is sufficiently flexible to allow for those variances and to not impede the appraiser from fitting the service to the user expectations. The minimums are still the minimums but everything beyond that is user-driven. It is that user-driven that we are arguing about in this thread.

These different applications are expressions of the underlying concepts and principles. None of them exist in isolation of those fundamentals.

 

[Ricky LaFleur]

WRT "appraisers peers", those peers do not consist of the entire population of appraisers. The definition and intent is very specific and has been since the inception of the SOWR:

Meaning, the user group consists of other users engaging the same type of assignment, and the peer group consists of other appraisers performing the same type of assignment. Not the appraisers who don't perform such assignments. Their expectations don't count.

I'm assuming you feel strongly about that interpretation, and who am I to argue with someone who taught USPAP. However, AO-29 goes on to say: "To be an appraiser's peer for a particular assignment, one must have the competency to address the appraisal problem presented in that assignment." I am aware there is no one set scope of work of how a SFR can be appraised. I am aware there are various work products that can be offered. I don't even do SFR appraisals. It's just an interesting dichotomy that seems to form between intended users expectations (i.e. cheapness because regulation is only real driver for appraisals) that translates into lower work products and the appraisers who are competent to perform (and may have performed) but generally disdain the lack of credibility that is the result from such minimum scope of work.