Is It USPAP Violation or Reviewer's Opinion

[djd09]

the sow makes you a slave to the client...and their political whims...anyways, the clients that make up the sow are not elected officials so it is all unconstitutional

 

[George Hatch]

Their handbook lays out their expectations, same as any other lender's appraisal policies. You can either agree to meet those expectations or you can withdraw from the assignment.

It ain't that deep.

 

[Mejappz]

In reading a recent sanction of an appraiser - I question the observations of the review and why these items would be mandatory to mention. A pond? A circle driveway? Have you ever seen a circle drive or off-site pond impact value? I mean lake view is one thing...but a pond? Especially in the middle of Oklahoma? I mean they are invariably red, muddy affairs with rare exception. And rarely over 1 acre in size. Some small watershed reservoir might be different impact, but a simple "pond" no. And why is a "circle driveway" so significant that it impacts value? I cannot recall seeing one that did.
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Finally, I have seen assertions by investigators that you must identify functional and external obsolescence in a property or comp. But USPAP only says you are only required to address accrued depreciation. So, when are you REQUIRED by USPAP to address functional or external obsolescence?

What a mess. This just shows why USPAP needs to go. The people enforcing it often don’t seem to get it. When they’re not dealing with legal issues(felonies) like the West Virginia Board fiasco, they’re tangled up in conflicts of interest.

Plus, the FHA’s rule about needing two listings in is in a **changing** market is pretty ridiculous. If the appraiser is like most he or she called it stable. it’s just another example of why these requirements need to go.

Was it a Kobe pond? Lol

 

[sputnam]

Finally, I have seen assertions by investigators that you must identify functional and external obsolescence in a property or comp. But USPAP only says you are only required to address accrued depreciation. So, when are you REQUIRED by USPAP to address functional or external obsolescence?

Functional and external obsolescence are part of depreciation. In appraisal, 'depreciation' is defined as a loss in the value of the improvements from any cause. USPAP requires you to consider all factors (that you can reasonably consider) that impact the value of the subject property.

 

[Elliott]

If the 'Reviewer' says its a USPAP violation, then its a violation. As with virtually all 'half-***' reviews, the finder of facts is automatically the trier of facts, and prosecutor of facts. State regulators are expected to find at least one case a month to bring to the board and exert their authority. Its just the way the system works. Now sometimes the regulator will like the appraiser or not like the appraiser, and that eventually will determine if the 'allegation' will be prosecuted to the full extent of what they determine to be a USPAP violation. There are no known TAF committees that determine if USPAP is being properly administered.

 

[Terrel L. Shields]

If the 'Reviewer' says its a USPAP violation, then its a violation.

Therein lies the rub. Don Clark used to defend appraisers before the board by pointing out that it wasn't a USPAP violation as claimed by the reviewer. Note that OK is/was pretty bad about hiring an outside appraiser to review these reports. Ditto reviewing new appraiser submissions. That was once done for free by a few of the instructors or friends of the board members. Not a very good system. But the insurance department runs the appraisers so they want that appraiser's money to be spent by them not the board....unlike Arkansas where they hire an investigator and have rebated part of our annual fees back for several years because the kitty is flush...and, of course, Okla has a lot more appraisers than Arkansas...thus generates a lot more money.

 

[shrubberyvaluation]

Can't say I ever put much thought into a circular driveway. Pond views I normally would consider.

 

[Terrel L. Shields]

Pond views I normally would consider

Here they are considered more of a hazard than anything.

 

[George Hatch]

Therein lies the rub. Don Clark used to defend appraisers before the board by pointing out that it wasn't a USPAP violation as claimed by the reviewer. Note that OK is/was pretty bad about hiring an outside appraiser to review these reports. Ditto reviewing new appraiser submissions. That was once done for free by a few of the instructors or friends of the board members. Not a very good system. But the insurance department runs the appraisers so they want that appraiser's money to be spent by them not the board....unlike Arkansas where they hire an investigator and have rebated part of our annual fees back for several years because the kitty is flush...and, of course, Okla has a lot more appraisers than Arkansas...thus generates a lot more money.

Just because someone reads the material incorrectly doesn't mean the material was incorrect to begin with. Render unto people that which people are doing. Which is readily curable by teaching them to understand the material.

What we're complaining about here is a reviewer projecting their own preferences onto everyone else's work as if those preferences are the universal standard for all appraisals. They're getting out over their skis. We don't get much of that here on this forum but back in the day it used to be one of the big controversies.

More recently, the whole inspection controversy is an example of people reading extras into USPAP which aren't actually there; and then getting mad at the point that the real minimums are far more minimal than what they normally do in their assignments.

 

[RCA]

What were the user's known/knowable expectations for that assignment? If it's not in writing then the tie goes to the runner. Burden of proof rests with the state, not the accused. Especially when the purpose of the review is to make a decision about the licensee and not the subject property.

Poor GH. You are wrong again.

The appraiser does have to support his adjustments with more than his subjective opinion. It doesn't matter whether it is the original appraiser, a reviewer or the state board of appraisals.

Certainly, the client can lay down his wishlist of requirements - with legal restrictions. In other words, that wishlist, by itself, is worthless. It has to be reviewed and filtered by the appraiser before it can even be categorized as "legitimate" - but of course a responsible appraiser, of which there are too few around.

For an experienced appraiser to carte blanche attack some opinion with a statement "What were the user's known/knowable expectations for that assignment?" is both a sin and misleading to other beginning appraisers. IT IS NEVER THAT SIMPLE.

There are several statistical methods which objectively determine whether certain variables impact value. Here is a page from "Hands On Machine Learning with R" by Boehmke, et. al.: