LandSafe checking appraisals with an AVM

[Pamela Crowley (Florida)]

http://list.realestate.yahoo.com/re/story....12/200208121101

I'm not sure if laughing or screaming is the most appropriate. Of course, maybe they will catch on that many of their cheap appraisers are not very good. Then again, if they do figure that out, they'll just blame all appraisers as if this is the norm.

Any of you here that do work for LandSafe - please excuse my bad opinion. It comes from knowing how very bad the LandSafe jobs at my prior supervisors office were - because the fee was so CHEAP.

 

[Mountain Man]

:roll:
Typical for this lousy AMC. Although I do admit to getting maybe a half dozen request a year (at my full fee) they can be a pain in the 8O to deal with. The reason they call me, is that their little AMV computer doesn't know how to handle a rural market that can have a $40,000 cottage sitting across the street from a 2.3 Mil. lake home. :lol: And that is very typical in my area. :wink:

 

[Julio E. Sune Jr. (FL)]

Oh!! LARA, ----then the next version shall be named SOPHIA (Dr Zhivago).

But wait!!! I know a better way for them to review appraisals-- Madame Cleo--(The TV Fortune Teller)

So!! A new lab for the AIVS virus will be created--- (Acquired Instant Valuation Syndrome)

8O 8O 8O

 

[Richard Carlsen]

I just finished a review on a small house in the rural area S/W of here that appeared to have been done for an AMC. The appraiser either really blew this one or just plain didn't care.

His value was 21% high (and he came in at $65k.)

House was a 30-year-old pole building converted to a house many years ago, poor fenestration, metal siding, etc. He called it frame construction. His estimate of site value was double what it should have been.

I suspect that there will be some moaning and gnashing of teeth on some of these lenders if and when they start checking out some of the loans they have made.

 

[xmrdfghap]

And people are wondering why Conseco is considering bankruptcy........go figure.

 

[Joe Birrell (NY)]

BRING IT ON !

I just love when brokers, LOs, property owners call trying to discredit
my reports, especially based upon some crapola AVM data. I love AVMs
because they are dumb as wall paper and have great appeal to yuppie
know it alls, pushy brokers, and arrogant LOs. "Submit 3 identical comps, in the same census tract, that closed within the past 3 months" gets rid of them every time.

 

[Karl]

I read that article as part of the support group being formed, for when the mortgage industry is called before congress to explain some of there loan practices. "It's not our fault we loaned out to much" U gotta see what the Appraisers did to us. Is it okay in USPAP to attach that article to the reports?

 

[Ross (CO)]

Great, present this special scoring program and then confuse the ever-lovin' heck out of all of us by flipping the normal and logical scoring process. They assign the number "1" to mean HIGH risk and the number "5" to mean LOW risk....when most every other comparative scoring concept would do that progressive scale in the opposite direction ! They probably expect a lot of "3" scores and then the old expression of "cup 1/2 full ? or cup 1/2 empty?" rules the day. Great scoring system ! The AVM tool + in-house reviews + truck-loads of defaulted loans may, .... may, just make someone wake up and smell the coffee.

 

[Caterina Platt]

"Lighthouse is not a data mining tool, it's used only so that we can assimiliate the appraisal directly into our software...." Uh, ya. Wanna tell me another whopper?

Damn glad I fired them! Even more glad I didn't do the Lighthouse junk!

 

[bradellis]

Pam,

Nothing new there except their scoring system which makes little sense.

Virtually every major lender out there already uses AVMs to check the appraisal- have been now for quite a while. Some also use BPOs. Surprised?

I use them daily- on virtually every appraisal I review in which I can get a hit. However, no one I know of simply "accepts" the output by itself. It is used much more to determine what sales are out there that may be relevant. I'll give you an example:

Appraiser uses comps that are .75, .8 and 1.2 miles away in a good size city. Value opinion- $280K. I run an AVM and find 31 sales within a half mile. Some are not comps at all. But sometimes, I find absolute model matches- same size home, same lot, .02 miles away, that sold 2 months ago for $220K. Once I found 14 models matches that all happened in the 3 months preceding the appraisal- only 1 (the absolute highest) was in the appraisal.

Guess I have to ask the appraiser why he/she chose the comps they did, no? You do NOT want to hear most of the answers.

Am I a great believer in letting a computer tell us the value? Nope. Am I a great believer in having as much data as I can reasonably get my hands on to analyze? Yep.

What is most interesting, though, is what happens in such a review process. The mortgage broker pressures the appraiser to come in with the highest possible value. Then the funding source looks at the AVM and gets a guy like me to ask some really hard and embarrassing questions of the appraiser.

So do be prepared to defend/explain your selection of comps and your thought process. Sometimes, even those model matches are not relevant- like when only the subject has the panoramic view of the ocean and none of those model matches do. Might as well discuss that in the first place, no?

The day will come when all this data is economically available to the individual appraiser. It will make our jobs easier. You will get fewer questions.

Until then, be careful out there.

Brad Ellis, IFA, RAA