Lender's Review Staff: Education/Experience in Question

[Charlotte Dixon]

Did a job for a Mort. Broker a month or so ago (I might add, the only one I do a little work for) and got a copy of a review which was done on it. MB asks me to address the following:
Review Appraiser Working For Lender: "Appraiser did not adjust for an interior townhouse unit vs. end townhouse unit. An end unit WOULD be worth more"

My Response: Review Appraiser did not read report. See Comments Section, Sales Comparison which states "Utilizing the matched pairs analyses, no difference in value was noted when comparing end vs. interior unit townhouses in the current market" ...and... (answering review question) The Review Appraiser's conclusion that there is a difference in value between end units and interior units appears to have been taken from that review appraiser's "mind-set"..The RA has no knowledge of our local market (being in Oregon, and we're in Delaware) and ironically displays no knowledge of paired sales. Adjustments are taken from the marketplace and the RA's comment that end units WOULD be superior to interior units is unfounded and disturbing. :twisted:

All hell broke loose. My MB said he can't turn that in or the loan will be denied & I shouldn't get involved in a p-ukin-g contest. I reconsidered, buckled under and rewrote it being as gentle as I could, but now I'm sorry. I should have let it fly and it would have eliminated my last Broker client. But, not fair to the Buyer/Seller.

Aren't we all just sick and tired of all this horseshipp :?: Like was said before on here...these review appraisers think they have to pick apart an appraisal to keep their jobs. This appraisal was a RUSH, RUSH, and now it's tied up on some dumb-bell's desk, probably trying to figure out what "paired sales or the matched pairs analysis" could possibly be. :roll:

 

[airphoto]

Charlotte ..

you gotta learn the politics .. make your point with gentle questions.

After referring to your report ..

1.) Please have your review appraiser forward to me his matched- pairs analysis whereby he arrived at the difference in valuation between end units, and non end units.

2.) Please provide me with review appraiser's resume, and copy of his license/certification.

3.) Please provide me with documentation as to review appraiser's geographic competency - specifically in my market.

Thank you ..

 

[Doug Walters]

Charlotte:
Was a matched pair sent to the RA in support of the statement? If not, its just an empty, boilerplate comment that the RA sees everyday. He/she has offered an opinion on their perception that an end of group townhouse or rowhouse is "worth more" (not a good choice of words on the reviewer's part). This comment is understandable for a variety of reasons that most appraisers readily know for the property style described. It is not a mindset, but a market supported observation with which the report under review contradicts. Rather than being upset with being questioned, ask yourself if the reviewer is correct. Something could have slipped by on the rush job. Or, if your observations are correct, you have been asked to prove it! That happens sometimes. I wouldn't view it as being whipped, its just that someone did read the report and had a question. We sometimes take personal offense to being questioned about our work when we see so much garbage that doesn't seemed to be questioned by anyone anytime.
Doug

 

[Charlotte Dixon]

Doug,
The matched pairs were quite obvious to any appraiser with even just a little experience. Two end units were cited and one interior unit. The subject is an interior unit. After adjusting sfla and condition, they all adjusted out at the same number. This appraisal was a text book case...of course, in my opinion :wink: The review appraiser's comments included: "doesn't make sense" and "WOULD be". Regarding my condition adjustment, I elaborated and wrote that comp #1 received a positive adjustment, indicating inferiority as compared to the subject (which was in average condition). I noted that comp #1 was in avg.-fair condition, having been a rental for two years, as verified by lisiting Realtor. The subject and comp #1 are each 6 yrs. old. The RA said "that doesn't make sense since both units are the same age; why would an adjustment be made"? :idea: This person has no reading comprehension skills. Thanks for your response, Doug, but I disagree with your analysis.

 

[jtrotta]

Charlotte
Airphoto offers very good advice - this is a political venue and you do have the right to an explanation, as provided in USPAP. Read the review section and you will find your answer within the writtings there.

Good Luck 8)

 

[Don Clark]

8) Charlotte:

You did it right. Don't be baffled by the BS you sometimes get as a response here. Airphoto has it right. I am forever amazed at how incompetent some RA's are. BTW, lack of jurisdictional competence is a violation of USPAP. So, as airphoto said, ask for a copy othe the RA's resume, license number, then forward your response to his/her state regulatory agency along with a copy of the appraisal and the original statements by the RA. I had a RA in Richmond, Virginia state that an Appraisal I had done in Virginia Beach, Virginia(almost 100 miles from the RA's market) was flawed as I had not adjusted for an inground swimming pool. What swimming pool says I? Well the MLS listing says it has an IGSP and you did not adjust for it. Idiot, says I, an IGSP is inground sprinkler system in my market, and the subject and all comps have an IGSP. The lender would not give me the RA's name or license number.

Keep up the good work Charlotte, and give the hell :twisted:

Don

 

[Anonymous]

When I have problems with an underwriter I always insist on talking to the idiot. I once had an underwriter who did not want to accept a comparable on a barrier island because it was over three miles away. I explained that the property was on an island, and the whole island was the market area. The underwriter asked what a barrier island was and informed me that she knew nothing about the New Jersey shore, she had never seen the ocean, she was in Iowa and she had never written an appraisal.

 

[Doug Walters]

Don,
I wouldn't refer to everyone's responses as BS, but their opinion based on their interpretation of what has been presented. If Charlotte's report contained the commentary she noted in a later response I would agree that the reviewer missed it and should be mature enough to admit it. If, however, it wasn't contained in the report but in the response to the review questions, then the reviewer was right in asking for it. Experience has taught me to be gracious rather than arrogant when dealing with a less experienced underwriter or reviewer. Yes, I know is can be a PITA, but it may be a tip off to writing a better report the next time.
Doug :wink:

 

[Charlotte Dixon]

Don,
Thanks for the support. It is especially appreciated when coming from a respected peer and instructor of appraisal practice.

Charlotte

 

[Paulette in Texas]

The really scarey part is when they don't understand paired data analysis or matched pairs. Sometimes they are WAY up the food chain and that is really scarey. Yeah we have to play politics sometimes in our answers, although sometimes they paint a big bold target on their foreheads and then it is let 'um rip. We will try only so far and then it is Katie bar the door.

Our policy: report followed by ONE polite answer and then if they still don't get it: I am NOT responsible for the tartness of my answers. Funny, we never hear back after the really tart stuff. Of course, we are known for paired data analysis, additional comps, and absolutely volumes of explanation almost to the point of being a narrative. So, if they keep pushing: then it is in their face.

Every time, I have had this scenario, it has never failed that the borrower was a HUGE risk with crap for credit. We are not their whipping boys. And we will only be pushed just so far.

We take pride in our work, go more than the extra mile, deliver a quality product. After that: suck lemons. Partins in Houston
Rotts Rule and Shih tzus holding its own.