Hybrid

[Meandering]

I have to say that you never cease to amaze me with the novel angles that you can come up with.

The "hybrid" process - someone other than the appraiser inspecting the home, either exterior only inspection or full interior inspection - has been reviewed by federal banking regulators and formally approved for use by lenders. That has happened multiple times, and it happened years before Fannie's current exploration of the process. Fannie's adoption of the process is not germane. I know this because several of the clients that we deal with did have questions about use of the process, and as a result of those questions they submitted formal requests to their regulators and did not implement the "hybrid" (really, modified desktop) process until their regulator told them, formally and in writing, that it was acceptable.

I do hope that you will forgive me if I accept the formal written opinion of the actual regulators over your personal interpretations.

As for the strict matter of USPAP compliance, given that USPAP has never required personal inspection of the subject property, any argument that the "hybrid" process is inherently non-compliant with USPAP is simply dead at the starting line.

And I have never said USPAP requires any inspection.

But you keep throwing it out there as if it is something to argue about.

It is not.

And how many bank reviews did it take for reviewers to find.........

Regulators fine U.S. Bank more than $600M for AML errors
https://www.americanbanker.com/news/regulators-fine-us-bank-more-than-600m-for-aml-errors

World’s Biggest Banks Fined $321 Billion Since Financial Crisis
https://www.bloomberg.com/news/arti...anks-fined-321-billion-since-financial-crisis

Regions Bank fined $7.5M for overdraft fees
https://www.usatoday.com/story/money/2015/04/28/regions-bank-overdraft-enforcement/26509783/

Santander Bank Fined $10 Million for Illegal Overdraft Fees
http://time.com/money/4406670/santander-bank-fined-for-overdraft-fees/

Wells Fargo fined $185M for fake accounts; 5,300 were fired
https://www.usatoday.com/story/mone...ned-185m-over-unauthorized-accounts/90003212/

Citizens Bank fined at least $34.5 million for pocketing customers’ cash
https://www.washingtonpost.com/news...n-for-pocketing-customers-cash/?noredirect=on

and on and on and on and on.

Just because everyone is doing it,
is not a valid reason to believe it is acceptable.

.

 

[George Hatch]

Marion, do you believe it's possible that at least some of the banking regulators may have already reviewed these concepts and formally sanction their usage under certain circumstances? Or do you think that its impossible?

 

[Terrel L. Shields]

vidence of acceptability, which you still can't provide

Sure Marion, it's our "peers" in the cubicles beavering away on line for the masters of the universe that dictate compliance. Comply or die. Or comply and starve.

 

[ucbruin]

We have been doing "hybrids" for over a decade now, and the average turn time is about half the turn time for a 1004 in the same area.

The inspectors used generally complete the inspection and deliver a property report in less time than it takes for the typical appraiser to schedule the inspection.

Now, having said that, I think one mistake that many are making (both appraisers and those who are looking at using such services) is looking at the times and fees associated with the current process and thinking they will automatically apply to a Fannie developed process. That is why I think most of the fee talk that is being tossed around is silly. Just one example - for most past "hybrid" work the square footage was just taken from pubic records and/or MLS. If Fannie's adopted solution requires something else (like measuring/sketching), that changes a lot with regard to both service time and fee.

2 quick questions....

"We have been doing "hybrids" for over a decade now..."
1. when it comes to your company doing hybrids, do you require the inspector to provide a sketch?

"If Fannie's adopted solution requires something else (like measuring/sketching)..."
2. Do you know if Fannie's pilot program is requiring the inspector to provide a sketch?

 

[Meandering]

Sure Marion, it's our "peers" in the cubicles beavering away on line for the masters of the universe that dictate compliance. Comply or die. Or comply and starve.

Comply and starve it's still all the same.

So help me with this peers thing,T.

In all these years, I have never been contacted by the state board to ask me what "I would do" in any given appraisal scenario, even though, some of my "peers" were sanctioned over things.

And back in the day, I went to every disciplinary hearing, yet never have I seen any appraiser drag a group of peers, nor a survey of peers out as defense of "what peers would do".

Is there any appraiser, anywhere that has a copy of a peer survey of what their peers do, so that everyone knows we are all on the same footing in any area and can call such to our defense if needed?

.

 

[Meandering]

Comply and starve it's still all the same.

So help me with this peers thing,T.

In all these years, I have never been contacted by the state board to ask me what "I would do" in any given appraisal scenario, even though, some of my "peers" were sanctioned over things.

And back in the day, I went to every disciplinary hearing, yet never have I seen any appraiser drag a group of peers, nor a survey of peers out as defense of "what peers would do".

Is there any appraiser, anywhere that has a copy of a peer survey of what their peers do, so that everyone knows we are all on the same footing in any area and can call such to our defense if needed?

.

And thinking along this same line of "what peers do",

Perhaps, appraisers should gang-up with each other and provide written statements to each other of what they do in certain scenarios.

Just another good reason for appraisers to get together and talk to each other.

.
.

 

[George Hatch]

"appraiser's peers" is a defined term in USPAP

"APPRAISER'S PEERS: other appraisers who have the expertise and competency in a similar type of assignment"

Note the reference to "a similar type of assignment", which is comparable to the reference to the power users' "expectations for similar assignments".

These are not the external benchmarks you are searching for. Nor were these references picked by accident or ignorance. There's no error involved. The ASB clearly *meant* to acknowledge the fact that IRL different assignment types involve different expectations.

You can tell what other appraisers and lenders are doing in those assignments by what the appraisers have been doing and what the lenders have been *engaging* and using. discerning typical from atypical is not difficult.

As a practical matter and WRT a state board hassling an appraiser for their SOW decision in a given type of assignment, the burden of proof would be on the state to demonstrate how their peers who normally perform such assignments would have considered the accused's SOW to be clearly unreasonable for that type of assignment. As in, most competent appraisers wouldn't have done that.

Frankly and aside from an appraiser not adhering to the terms of the engagement , I've never seen a discipline summary for my state that mentioned anything about an inadequate SOW decision. Aside from that, if the discipline is related to the development side of the assignment at all it's almost always about not doing what they said they did in the report. And even that could usually be characterized as a reporting problem rather than a development problem.

 

[Terrel L. Shields]

"APPRAISER'S PEERS: other appraisers who have the expertise and competency in a similar type of assignment"

George, who sees what "peers" do? How many "good" appraisals do you view? I've rarely been privy to my peers reports, and some were suspect, including a couple from a USPAP instructor. How many USPAP instructors have been sanctioned? I can think of 3, including an ex-forumite. One lost his license. There is considerable controversy over the buddy system in science where "peer-reviewed" works are basically closely connected (#SITG) academia and not real third party reviews. Sound familiar? So who and when has anyone been properly peer-reviewed by a true peer committee...that standard is turned on its head by suggesting we determine what our peers do rather than our peers vet what we do. Marion's point is quite valid. How and who selects our peers?

 

[George Hatch]

As far as I'm concerned the 2-part test for SOW decisions is significant in the parties that were *excluded* from the SOW test. For instance, the state boards are excluded. The states can establish laws and regs, and they can add additional requirements VIA adding to those laws and regs, but they can't just make sht up as they go along.

As for board decisions WRT appraisers holding USPAP certs, let me state the obvious: Just because I took a course and passed a test and knew more/less what I'm talking about at one point didn't ever elevate me to untouchable status. If I screw up then I should be held to accounts, and arguably to the higher standard of not even being able to claim I didn't know any better. Someone who has demonstrated they actually do know better *shouldn't* be given the benefit of the doubt WRT understanding what the requirements are.

As well, we've also seen examples of boards that had people serving on them who were technically incompetent with the either the USPAP material and/or their read of the laws/regs they are charged to enforce. So "gov't incompetency" doesn't amount to an appraisal standards argument, either.


Right about now I'd imagine there are probably a couple state boards trying to figure out how to prohibit licensees from performing desktop appraisals for mortgage lending assignments as a matter of state regs. And more power to them if they can figure out how to do it.

 

[djd09]

George, who sees what "peers" do?

I don't have access to CU. Do you?

If my peers are going to jump off the cliff, do i have to?