Hybrid

[Evincere]

Now let me ask you the reverse: when considering the lenders have been using BPOs and AVMs for certain uses, how certain are you that there are NO legitimate uses at a lender for a hybrid?

I don’t think anyone is claiming a lender has no use for a hybrid for certain uses. BPOs and AVMs used for certain uses were never (to my knowledge) marketed as glorified products to be completed and signed off on by an Appraiser rendering them as more reliable or credible.

There have been many attempts and many new products over the years designed in an effort for the appraiser to recapture a share of the BPO market. Appraisers weren’t interested in the $50 45 minute quickie then and I see no reason for them to be interested today as The issues remain the same. For the appraiser- Compliance and fees.

 

[Deleted member 130081]

I don't see anyone making the claim that these are a good product for all lending purposes. Or for appraising all types of properties.

Now let me ask you the reverse: when considering the lenders have been using BPOs and AVMs for certain uses, how certain are you that there are NO legitimate uses at a lender for a hybrid?

Wait what? Danny just said these are being ordered every day by the hundreds by lenders.

What this is, is a slippery slope. It is a measure to skim the expense of the appraisal, without regard to the quality of the appraisal. What do you suppose the world would look like if these were how it happened all the time? Which brings me to your last point...

BPOs and AVMs have certainly been used in lending, and in the case of BPOs, have been developed illegally in most cases. Does that make them a good product? Seems to me the lending world is much more interested in compliance, as opposed to making sound lending decisions. History shows this over and over and the most recent history, shows the taxpayer providing the bailout when things go south.

The greatest trick the Devil ever pulled, was convincing the world he does not exist. Not trying to get religious here, but there are plenty of Devils in the banking industry pulling the strings. Misguiding focus is one of the oldest tricks in the book. I wonder, do you suppose you are immune?

 

[J Grant]

If you believe so fervently that personal inspection is so critical, how many times since 1989 have you written to the ASB to encourage them to change USPAP to align with your views?

? USPAP has nothing to do with it. USPAP does not require an inspection,not does it require photos, nor original photos ( which you know of course )

So why would I be writing to USPAP for years about my views on personal inspection? It's a matter of which kinds of assignments a personal inspection can impact results. For origination loans needing interior inspections, Fannie and Freddie ( and FHA) believed was the appraiser to personally inspect ( until recent pilot program for Fannie and Freddie. I can wirte to them and will, but doubt anything I say will have any impact. Both agencies seem intent on patterning their business model more after UBER now than protecting the public trust, reversing their historic decades long position of requirements that the cert signing appraiser to personally inspect for URAR loans (or be responsible as supervisor if a trainee inspects, many lenders would not accept reports where a trainee inspects alone, now they in bifurcated due to Fannie/Freddie acceptance they will accept reports by a non appraiser inspecting alone, how ironic)

I have no idea why you posted this except to throw shade on what I wrote about bifurcating the appraisal for URAR origination loan appraisals.

 

[Eli]

This is better than dominos.

 

[DWiley]

Wait what? Danny just said these are being ordered every day by the hundreds by lenders.

What this is, is a slippery slope. It is a measure to skim the expense of the appraisal, without regard to the quality of the appraisal. What do you suppose the world would look like if these were how it happened all the time? Which brings me to your last point...

That is correct. They have been used for years for servicing, HELOC and other non-origination purposes. What is new is that they are being considered for a portion of origination work. And that consideration is based on examination of past performance of "hybrids" as compared to "traditional" work.

What motivation does Fannie have with regard to fees? Whether the appraisal cost $200, $300, $500 or $1,000 is irrelevant to Fannie. The driving force for the GSEs is service time. Turn times on this work has historically been significantly lower. Since we don't yet know the SOW or reporting format that Fannie might adopt, it is impossible to say if the same will be true of any process they pursue.

 

[Deleted member 130081]

Gee. Where I have heard sentiments like those last two sentences before?

When the database war was being waged, I was labeled as being part of the "opposition" and "the dark side" then as well. (you can easily scan historic posts and verify that). When, in fact, I was simply working for the best interest of appraisers, and doing so having been exposed to a broader experience than most who painted me with that label. So, at least I am on familiar ground. As things have played out, there are many who disparaged my views on a national appraiser database who have subsequently called for the formation of the very thing I was fighting for. C'est la vie. Whats a few million dollars lost?

Many appraisers label the people who provide a their very livelihood (at least for most residential appraisers) as "opposition." I am working hard to try to change that, but that does not include just telling people what they want to hear to appease them, as some of today's popular pundits do.

There is over ten years of market testing behind the "hybrid" process. Lenders order hundreds of them every day, and have been doing so many years. It is THEIR analysis of how this affects risk that, at the end of the day, will drive market demand.

I understand the fear, especially given the crazy fees I see being tossed around. But fear is best addressed with a logic and sound reasoning. All this ad hominem, ignoring of basic facts, and general fear mongering will get us nowhere.

LOL. Champion of the appraiser. Yup, that's you Danny.

I think when the world economy is at stake, and the US taxpayer pays for the bailout of banks who could care less about anything other than the profit in front of them for the day, then it is time to stand up and oppose dangerous ideas. Hybrids are a slippery slope. They are an inferior and dangerous product. Appraisers should not be telling our lending clients these are a-ok, rather should be sounding the alarms and alerting them of the risk. You keep saying the bankers are self-regulating their own risk - maybe you should take up being a comedian. Sell your bridge to someone else.

 

[Deleted member 130081]

That is correct. They have been used for years for servicing, HELOC and other non-origination purposes. What is new is that they are being considered for a portion of origination work. And that consideration is based on examination of past performance of "hybrids" as compared to "traditional" work.

What motivation does Fannie have with regard to fees? Whether the appraisal cost $200, $300, $500 or $1,000 is irrelevant to Fannie. The driving force for the GSEs is service time. Turn times on this work has historically been significantly lower. Since we don't yet know the SOW or reporting format that Fannie might adopt, it is impossible to say if the same will be true of any process they pursue.

I rest my case.

 

[J Grant]

Regarding bifurcated: an appraiser personally inspecting vs a third party appraising may not be critical for all reports, however it may be crtical for some, or at least lead to different value or other opinions than if appraiser had personally inspected. The proble is, it is unknown on which assignments these will occur, even among so called "cookie cutters". The results, even if Fannie Pilot program deems acceptable, of mixing in bifurcated with traditional appraisals in any volume won't be known for years, as it is stypically years out from origination after problems arise with a loan or an appraisal get scrutinized ...so it remains to be seen, and unknown...For Fannie and Freddie to roll the dice on an unknown outcome that will take years to play out is on them, so will see if it displaces traditional appraisals in any sizable volume what a long term result will be.

The trend among AMC;s and big box lenders who run an ordering dept along AMC lines is always to push for more extreme faster turn times and lower fees, which they hit a wall with on traditional appraisals, Replacing a segment with bifurcated will follow the same pattern, pressure for faster turn times/ lower fees and volume on staff; ( and possible appraisers desk portion expanding geo areas ). What impact that will have on the bifurcated quality or who will accept them as an appraiser or inspector remains to be seen because the pressure on fees, turn times and staff for high production of bifurcated won't yet be present in the Fannie pilot test phase.

 

[ucbruin]

That is correct. They have been used for years for servicing, HELOC and other non-origination purposes. What is new is that they are being considered for a portion of origination work. And that consideration is based on examination of past performance of "hybrids" as compared to "traditional" work.

What motivation does Fannie have with regard to fees? Whether the appraisal cost $200, $300, $500 or $1,000 is irrelevant to Fannie. The driving force for the GSEs is service time. Turn times on this work has historically been significantly lower. Since we don't yet know the SOW or reporting format that Fannie might adopt, it is impossible to say if the same will be true of any process they pursue.

I get it that FNMA is disinterested in appraisal fees....
So why is FNMA interested in turn time....

FYI...
I'm open to participate as an inspector so I believe I'm open minded on this product..

 

[Mr Rex]

Hybrids are EVIL !