July 2008 ASC Q&a- Wink Wink Comp Comp

[Hamlet]

There are obviously two definitions of comp checks. We define a comp check as an appraisal because it is an opinion of value. Spend a few moments reading on the Broker Outpost and you will clearly see the definition of comp check in the MBs mind.

They are clearly NOT the same thing.

 

[Fred]

There are obviously two definitions of comp checks. We define a comp check as an appraisal because it is an opinion of value. Spend a few moments reading on the Broker Outpost and you will clearly see the definition of comp check in the MBs mind.

They are clearly NOT the same thing.

But USPAP only addresses and regulates what is in the appraisers mind, not what it is in a mortgage brokers mind.

 

[Hamlet]

But USPAP only addresses and regulates what is in the appraisers mind, not what it is in a mortgage brokers mind.

Yes, I know and therein lies the dilemma. We appraisers are faced with an impossible situation.

 

[Carnivore]

Yes, I know and therein lies the dilemma. We appraisers are faced with an impossible situation.

This thread caught my eye because it is a partial solution.

http://appraisersforum.com/showthread.php?t=141442

Since FHA is becoming the subprime King again it should make a difference.

Frankly the ASB ought to just stay out of things they dont control or can not control or already have adequate controls in place. The question they developed and answered was to involved in a problem they can not fix. The Q&A's should clear things up, not add to the confusion and/or send the wrong message to users of our services.

Some of you have suggested that part of the problem lies in the definition of "Comp Check". The ASB can not fix an undefined problem or term. I personally think they can not do anymore about the "Comp Check" problem as it relates to residential appraisers and a specific definition is not needed. This is a matter of USPAP enforcement which falls under the pervue of the Individual State & Possessions Appraisal Boards.

 

[DWiley]

Now, that makes one out of how many appraisers that can do it versus how many appraisers required to be able to do it and can't?

It is true that a lot of appraisers use software they don't really know how to operate. Some appraisers are currently trying to get states to say that appraisers' lack of knowlege means that there are USPAP issues with the software. I can agree that there are USPAP issues, but it is not with the software.
:laugh:

 

[SANDY]

Help me, I can't say "no"!! Seriously, that sounds like something an addict would say.


You're the one who isn't getting the point. The ends do not and ultimately cannot justify the means, and if you use indirect means your opposition will just work around them. Trying to "backdoor" a solution will only result in a backlash. You won't end up with a 70% solution or a 50% solution; it will still end up back at the 0% solution and all that will be left will be the 100% collateral damage resulting from the law of unintended consequences.

There are solutions to slow your clients down, but the only way to address their behavior is to approach it from their end.

When we wanted to stop the requests for "re-addressed appraisals" what method turned out to be the most effective? Was having the appraiser inform them that USPAP doesn't allow misleading reports effective? No it wasn't.

OTOH, shoving a copy of the letter at these MBs from the federal banking regulators and addressed to the lenders reminding them it was against federal banking regulations to accept re-addressed appraisals, well, that actually works quite well. I dunno about you, but when I use the right tool for that request it works 100% of the time AND I still get to salvage the client relationship.


As far as the public trust is concerned, the only thing that will improve that is when appraisers commit to saying "no" as appropriate, whether the pressure comes at the beginning, middle, or end of the assignment. Playing word games with "comp checks" is like rearranging the chairs on the deck of the Titanic. It will never solve the underlying problem. Ever.

Didn't USPAP address the re-addressing problem??? I have personally used that USPAP provision to--as you say salvage a client relationship while saying no!!!
But you and the ASB have to wake up and realize that a "just say no" campaign just isn't going to work--kinda like spitting in one hand and hoping in the other--see which one fills up first!!!
It's time for all(including TAF, ASB) to get in the whole game and quit using the same ole sorry excuse that it's not our job. Otherwise those lofty words like "protect the public trust" mean diddly squat.

 

[Carnivore]

Didn't USPAP address the re-addressing problem??? I have personally used that USPAP provision to--as you say salvage a client relationship while saying no!!!
But you and the ASB have to wake up and realize that a "just say no" campaign just isn't going to work--kinda like spitting in one hand and hoping in the other--see which one fills up first!!!
It's time for all(including TAF, ASB) to get in the whole game and quit using the same ole sorry excuse that it's not our job. Otherwise those lofty words like "protect the public trust" mean diddly squat.

Sandy,

I am trying to make the case that you are asking the wrong people. You State appraisal board could say something in writing. If you can not get them to take a position then there is nothing else you can do. Its like I said earlier the cheaters will not get caught because they(if smart) destroy any evidence of a non-USPAP compliant comp check. It was in there head, and they had a few MLS sell sheets when they gave the answer. If they did not get the deal(there thinking) then it all goes in the trash and no one is the wiser.

This problem is never going away, Never!

 

[SANDY]

The Appraisal Standards Board promulgates USPAP for both appraisers and users of appraisal services.

What does this statement mean? I see plenty of authority to back-door some regulations on users of appraisal services but ya gotta have the backbone to do it and ya gotta be the type of person that takes the words "protect the public" seriousely even if it means going against the party line!!!!!!

HMMMM- Someone like Pam comes to mind-one of few of us that was willing to put it on the line. The ASB, TAF and many others that served on regulatory boards should be ashamed of themselves for their lack of courage to step up on sooooo many issues. Too easy to fall in line with the party line!!! Comparing them to Pam in terms of their willingness and courage to stand up and do something is like comparing a **** ant to an elephant.(metaphorically speaking of course)

 

[Bill_FL]

Why does it seem like we are trying to figure out the best way to mop up the water spilling over a dam instead of fixing the dam?

If comp check requesters and the people who perform them are the problem - what is the best way to solve that?

I can offer some ways that are not:

1 - Do not make oral reports, desktops, or drive-by's illegal. What the comp checkers are doing now is wrong, what makes anyone think that making it more wrong will stop it? Don't take good, reasonable tools away from good ethical appraisers.

2 - Don't think that new AQB requirements will solve the problems. Having stricter licensing requirements will simply make the unethical people who really want to do this unethically jump through a few more hoops. Bad people are bad people. There are bad lawyers, doctors, accountants and business people at all levels of educational backgrounds.

3 - Do not turn over the appraisal ordering business to a government or quasi-government agency. That rarely solves any problems.

Now, some suggestions to fix the issue?

1 - The process of comp checking really boils down to value shopping. That is the issue. To fix that, the ordering of appraisals has to be taken away from MB's and LO's. There can be no involvement from the orginators. The appraisal should be ordered by the underwriting department of the lender.

2 - Licensing and enforcement from the lender's side should take place.

I dont think there is much more than that needed.

 

[DWiley]

The ASB, TAF and many others that served on regulatory boards should be ashamed of themselves for their lack of courage to step up on sooooo many issues.

It seems like they did step up on this issue, it's just that some don't like the answer.

It does not matter how much "courage" a regulator has, they can only regulate those things within their jurisdiction. The ASB is authorized to promulgate appraisal standards. Those standards already say that unethical contingencies are prohibited.

The ASB is not authorized to regulate the activity of mortgage brokers. You might as well ask them to write stricter cosmetology standards because an appraiser somewhere got a bad haircut.