Hybrid

[George Hatch]

We are well aware of the physical inspection aspect. Problem. We are seriously regulated about using an assistant in my state. We have to take a class to even have a trainee. Hybrid inspectors are not our assistant. The result is we must appraise something with information we may not trust prepared by people who may not be competent nor trustworthy.
You and George are saying clients trump USPAP as well as the state board. They dictate the SOW. Our choice is agree or eschew the work. If this doesn't ultimately bite us in the butt, I don't see how anything will. So just write a number on a postcard. So why not eliminate the inspector and simply guess at the condition...you know, like Zillow does? We are complicit in dumbing down our expertise as well as carving off a huge chunk of the potential income meaning we need no trainees and about half the CRs need to surrender their license.

I never said anything of the sort and in fact have repeatedly said otherwise. Everyone knows that client extras can never contradict our minimums. Your problem stems from attempting to attribute to USPAP minimums that aren't there.

You are not training these inspectors on how to appraise a property, nor are they engaged in performing appraisals on properties.

 

[J Grant]

Is there only one hybrid program out there? I thought we were talking about a *type* of appraisal service, not necessarily any single application.

My focus is on replacing traditional appraisals wih hybrids for lending origination work with non appraiser inspector doing interior


A hybrid appraisal aka what some call an evaluation with ext inspection by non appraiser that replaces a BPO or AVM can make sense as can other uses for it.

 

[Meandering]

I never said anything of the sort and in fact have repeatedly said otherwise. Everyone knows that client extras can never contradict our minimums. Your problem stems from attempting to attribute to USPAP minimums that aren't there.

You are not training these inspectors on how to appraise a property, nor are they engaged in performing appraisals on properties.

But,
They are performing inspection for appraisals.

Checking all the appliances work, including the heat, and air conditioning.
water, working and getting hot
sewer/septic, waste pipes, leaking, seeping, not draining
and in some states, a license is required for such inspections if you are not an appraiser, because they are selling the results of their inspections - via a fee for performing them.
And let's not forget the all important water heater strapping and CO2 and smoke detectors, armed and working.
And the missing handrails, cracks in the ceilings and walls of all rooms and foundation.
quick release window bar levers
Functional design and layout. Would hate to see the only bathroom in a two story house is only one one story and no appraiser knows which story it is on.


Oh, and never mind if the inspector is an agent and might want to sell the house if it doesn't "appraise" high enough for any needed refi. Would almost bet that's where the best pictures will come from.

Oh and never mind that agents have fiduciary responsibilities to their brokers, not to any AMC and in most states, you can't have conflicting agency agreements over the same thing. If the brokerage has the buyer or seller, the agent's job is see a deal close, not to be "independent" of anything.

.

 

[George Hatch]

Not allegations,

But no short term memory loss here.

It was you who commented about your relationship with DW,

when DW had a question,
you posted the poll
and Timmy got upset over the answers.

I'm sure even JGrant remembers that little game of get them to do it anyway.
.

I've known Danny for as long as you've been appraising. I met him when he was teaching the first USPAP Instructor course in 2001, years before he got solicited to go to work for an AMC. We've talked a bit all along since then. We normally talk about USPAP, ASB and AQB activities and the like. That's been common knowledge around here.

So while I didn't stop talking to Danny once he went to work for the AMC, that doesn't mean I have a relationship with an AMC. Danny's management prolly has no idea who I am, nor would they care about me or my opinions even if they were familiar with me. Why would they? They have a USPAP expert on staff.

Sometimes a cigar is just a cigar. WYSIWYG. He and I did have a discussion about some stupidity on this forum so I decided - on my own - to pursue that and flesh the conversation out a little. We've have other conversations where we didn't exactly agree, which is also common among appraisers, so there's that, too.

REGARDLESS, even if I was their *****, I'm still right about this issue and you're still wrong. Not because of who either of us are, but because the reasoning you're using sux.

As for why I spend time on the issue, it's the same reason I have spent the time I've spent on this forum all along. In fact, the main reason Danny even knew who I was before we met (which came as a shock to me) was because of my activity on this forum.

In short, I'm just doing what I've always done here. I'm just being consistent.

 

[Terrel L. Shields]

You are not training these inspectors on how to appraise a property, nor are they engaged in performing appraisals on properties.

They obviously are doing a job previously reserved to the appraiser. We are talking bank work. Not USPAP work. You keep mixing one with the other. And you keep saying "we can". " We, paleface?" as Tonto replied to the Lone Ranger when surrounded by Indians. Got a rat in your pocket? YOU obviously have not done one single "Hybrid" for <$100, using an on line form forced upon you by an AMC and/or bank subject to real scrutiny by a secondary lender.

Regulated banks below de minimus undercut appraisers by using evaluators. But evaluators charge more than hybrids...so now banks want to undercut evaluations with hybrids at half price of evaluations yet maintaining the all important noose around the appraisers license...I mean neck, sign here. It's your liabilities they want, not your expertise because they know full well that value guessed at is about as credible as Enron bonds. And USPAP does ask you comment on the quality and quantity of the data supplied, so you are rubber stamping someone else's inspection and taking full responsibility for it or stating the obvious in the report...just what a banker told me about evaluations. "It isn't worth the paper it's written on."

 

[Meandering]

I've known Danny for as long as you've been appraising. I met him when he was teaching the first USPAP Instructor course in 2001, years before he got solicited to go to work for an AMC. We've talked a bit all along since then. We normally talk about USPAP, ASB and AQB activities and the like. That's been common knowledge around here.

So while I didn't stop talking to Danny once he went to work for the AMC, that doesn't mean I have a relationship with an AMC. Danny's management prolly has no idea who I am, nor would they care about me or my opinions even if they were familiar with me. Why would they? They have a USPAP expert on staff.

Sometimes a cigar is just a cigar. WYSIWYG. He and I did have a discussion about some stupidity on this forum so I decided - on my own - to pursue that and flesh the conversation out a little. We've have other conversations where we didn't exactly agree, which is also common among appraisers, so there's that, too.

REGARDLESS, even if I was their *****, I'm still right about this issue and you're still wrong. Not because of who either of us are, but because the reasoning you're using sux.

As for why I spend time on the issue, it's the same reason I have spent the time I've spent on this forum all along. In fact, the main reason Danny even knew who I was before we met (which came as a shock to me) was because of my activity on this forum.

In short, I'm just doing what I've always done here. I'm just being consistent.

And your stake in selling these bi-f appraisals to the lemmings as acceptable is?

 

[bnmappraisal]

Wow ... I had to skim through parts of this thread because I just felt like through a lot of it

The thing is we all know that regardless what the fee is, you would do all the work that is supposed to be done. I'm just not convinced that the people saying they complete them in under a hour are doing everything they are supposed to. Either intentionally or just by not knowing.

I have to agree with Flacco here. I don't think they're "doing everything they are supposed to" be doing either. Maybe? Maybe not. But IMO, probably not

 

[George Hatch]

But,
They are performing inspection for appraisals.

Checking all the appliances work, including the heat, and air conditioning.
water, working and getting hot
sewer/septic, waste pipes, leaking, seeping, not draining
and in some states, a license is required for such inspections if you are not an appraiser, because they are selling the results of their inspections - via a fee for performing them.
And let's not forget the all important water heater strapping and CO2 and smoke detectors, armed and working.
And the missing handrails, cracks in the ceilings and walls of all rooms and foundation.
quick release window bar levers
Functional design and layout. Would hate to see the only bathroom in a two story house is only one one story and no appraiser knows which story it is on.


Oh, and never mind if the inspector is an agent and might want to sell the house if it doesn't "appraise" high enough for any needed refi. Would almost bet that's where the best pictures will come from.

Oh and never mind that agents have fiduciary responsibilities to their brokers, not to any AMC and in most states, you can't have conflicting agency agreements over the same thing. If the brokerage has the buyer or seller, the agent's job is see a deal close, not to be "independent" of anything.

.

Do you have reason to believe that any or all of those items will be routinely overlooked in these inspections? I mean, its not like appraisers ever miss any of these items. Right?

You're loading "what ifs" about biased vendors into this that would be equally applicable to any other type of appraisal service. And if I had a dime for every appraisal report I saw that included the disclosure that the appraiser IS NOT an inspector I could buy a gallon of Starbux coffee.

If an appraiser has reason to believe the information provided is inadequate in quality or quantity they can always choose to say "no". Same as applies to any other type of appraisal service.

 

[George Hatch]

And your stake in selling these bi-f appraisals to the lemmings as acceptable is?

Same as always - I think appraisers are better served if they have the information it takes to make the informed decision. I don't think of appraisers as children who need to be protected from the truth lest they use it to make a decision I don't like. I assume my peers are capable of deciding for themselves where lie their best interests.

You obviously don't want appraisers to perform hybrids. I don't have an opinion one way or another about whether appraisers should or shouldn't do these. My opinion extends only so far that if they do perform one, I want them to perform it to specs. Same as any other appraisal assignment.

I have grave concerns about some of the proposed uses for these things, but as I have said before, those are at the client and investor level, not the appraiser liability level or the appraiser licensing level.

There's no magic or luck involved. Say what you do and do what you say. Your fee is a matter that's between you and your client. If you no like, you no buy. And vice versa for the clients.

 

[Eli]

Fraud and bifurcated have nothing to do with each other and should be separate topics. It's more about ethics in general since a "pushed" or weak appraisal may not rise to the level of fraud, and competency/experience. A good appraiser will do a good job on a bifurated appraisal or on an appraisal they inspected, and a bad or less competent appraiser will do a bad job on either one.

The problem with bifurcated, if it becomes widespread for origination loans, is a bad, or marginal appraiser can do a heck of a lot more of them. The reason "stakeholders" are pushing them is to squeeze more production out of appraisers, and by paying both the appraiser less for their portion and paying the inspector a low rate their margin for profit increases. There is no public trust or competence reason that drives this experiment, it;s all about greed and speed, like a day quicker turn time is going to mater on a thirty year loan and purchase or borrowing decision involving hundreds of thousands of dollars.

The potential problems in this system of hybrids as with so much else on res lending side when decisions are made about what benefits lenders and AMC;s rather than what benefits public trust, the dynamic favors the bad actors. Those appraisers who will appraise over large areas now since someone else is inspecting and do fast crank out work and the inspectors who produce high volume as well.

Doing hybrids with someone else inspecting allows an appraiser to vastly increase their coverage area. Is this good or bad? It might depend on point of view, but experience in an area is important overall to good results. There may be assignments where this is not the case, but one never knows when it is the case.

The more ethical appraisers might not feel competent appraising 200 miles away in an unfamiliar are for a hybrid, while the less ethical will say what the heck, they are reducing our pay, they hire anyone why should't I profit too? ( they have a point) And that less ethical appraiser will suddenly expand their coverage area to a great geo distance since some schmoo is inspecting and appraiser does not have to travel. This will put even more pressure on the remaining competent or ethical appraisers...should they expand their coverage area to compete or avoid hybrids? How does any of this serve the public trust?.

It is not difficult to train someone to measure a property and take photos. And it can be done by a non appraiser . But the problem is all the nuances or value related influences these people might not report, or report differently than we would ( since they do not see the property through the lens of an appraiser), and then the appraiser's disconnect from the third party results can add to that in diminished resuts.

Will see how widespread it becomes, if FHA allows it etc. I can certainly see it for drivebys but they are limited in scope anyway so ext inspection , other than revealing aspects of the neighborhood was never as critical to results. If int inspection hybrids become widespread will not know results until they play out in real world conditions of cheap/fast and enough reports enter the system and enough years go by to see the results.

Nice post but truth in lending disclosures are related to fraud. Break it down on truth in lending disclosures. Don’t worry. Louisiana will break it down like double barrel shotgun.