Hybrid

[George Hatch]

I rather like the idea that lenders order what their appraisers tell them to order. Ima try that with my clients.

 

[hastalavista]

So unlike our friend Flacco apparently believes, you are saying that AMC's have incentive to not push hybrids in lieu of traditional 1004's. Thus, you would probably agree that Flacco's implication that Danny Wiley is shilling for hybrids because they are somehow more profitable for AMC''s....

Danny doesn't need me to support his position. But I'll share an observation (which Danny may or may not agree with)....

Danny's company has been doing these hybrids long before they were ever on my or most of our radars. They have (I'll guess) developed a SOW and reporting format which has been customized to fit what the intended use of those assignments were. I'm 100% confident that if there was a SOW or disclosure issue prior to Danny joining the company, it has been corrected so that it is now compliant. I fancy myself as somewhat of a USPAP nerd, but if I have a question, Danny is one of three I'm going to ask, and maybe one out of two once I hear his answer, am going to ask no further (that's me!).
So, what his company has done in the past was for a well-defined assignment that, at best, only marginally competed with traditional appraisal work. If the GSEs and mainstream lenders weren't considering to expand the use of hybrids, no one (myself included) would be up-in-arms with what Danny's company had been doing.

What's being considered now is to move the hybrid into what was the traditional appraisal's playing field. My 100-yard field may be clipped to 95 yards because of it. And, I'll also venture to guess that whatever SOW/reporting format Danny's company has used in the past for those assignments will need to be modified/changed if it expands into what was once my playing field.
So I don't think Danny's company has any incentive to take 5-yards away from traditional appraisal work and give it to the hybrids. What I do think is that if the regulators allow for that taking, Danny's company is in a competitive advantage for that 5-yards because they've been operating in that non-traditional appraisal space while others are now trying to figure out how to come up to speed.

I don't recall Danny's position to be similar to mine: I think maybe that 5-yards I'm giving up can be given up because you don't need a traditional appraisal for all transactions given the collateral risk. I don't think I've ever heard him say that (I could be wrong). What I have heard him say, similar to me, is that such assignments can be done with full USPAP compliance. But he knew that long before I ever considered it as a question to evaluate.

I'm confident that an AMC or an appraiser would prefer to fill up their pipeline with traditional appraisals vs. hybrids because the profit margin is higher for traditional appraisals.
An AMC just like any appraiser will make a choice to offer some other service to potential clients if the profit margin is sufficient.

For the product to work, both appraisers and AMCs have to make sufficient profit...but in the AMC's case, it is possible they take a low to neutral profit if that is what it takes to keep a client who provides more profitable assignment-types.
I do this as well, but on a much smaller scale. I'll take a lower profit for a good client to ensure I'm their go-to appraiser for the higher-margin assignments.

So, that's how I see it!

 

[Mr Rex]

I'd like to see the SOW requirement for the "Inspector" as well as any "qualifications" required of said "Inspector". Is that too much to ask?

 

[Terrel L. Shields]

But you seems to be painting all appraiser's with a very wide brush.

I gave you the MAACO example, but an evaluation will do. An appraisal done on 40 acres of my land for $400 was dead on the price. An evaluation, done for $175 was $4000/acre. The adjacent parcel sold for $5,250/acre. How did they miss it? It was in the MLS.

So if it takes 8 hours to do a credible, inspected report, the hybrid will say,, so you are saying appraisers will work for $8.13/hour....or be like an evaluation, "not worth the paper it's written on."

 

[George Hatch]

Rural is almost its own appraisal discipline IMO. I don't think it works to use rural as the primary measure of what's reasonable in the data-rich environments.

 

[djd09]

I should get into the manure business. Plenty here.

But i bet none of them will be doing that garbage, so at least we have something in common.

 

[bnmappraisal]

So unlike our friend Flacco apparently believes, you are saying that AMC's have incentive to not push hybrids in lieu of traditional 1004's. Thus, you would probably agree that Flacco's implication that Danny Wiley is shilling for hybrids because they are somehow more profitable for AMC's is pure unsubstantiated garbage.

I'd counter that the AMCs in general WOULD have the incentive to the "hybrid/bi-furcated/desktop" due to volume.

 

[djd09]

All this Hybrid propaganda may be worse then the Appraiser Shortage. And then the TAF lowered the qualifications, you know to make the clients happy.

 

[timd354]

I'd counter that the AMCs in general WOULD have the incentive to the "hybrid/bi-furcated/desktop" due to volume.

Not as replacement for traditional 1004's since the margins are apparently smaller per Denis' information.

 

[djd09]

TimD won't be doing them but here he is , again, telling us how it is. Danny is the worst kind of shill, inside the beltway.