More On Free Comp Checks

[Mike Kennedy]

Can you get even one USPAP certified instructor to post here without a fake name and agree with that analysis?

I don't think so.

Until "the Bible" is injected with "common sense", and revised by removal of "contract review" FIRMLY AND FINALLY establishing that an "objective, TRULY independent" value opinion with NO advance hints, suggestions, statements, "winks" or information provided by parties with vested interests

is the Only Responsibility of an Appraiser - and not "hitting or coming close to hitting THE CONTRACT NUMBER"......

Current USPAP Instructors are tasked with quoting from the "Bible" to maintain their teaching qualifications.

Appraise the Property NOT the Contract.

 

[Hiker]

And what happens if after doing the inspection the appraisal now comes in lower. The MB is ****ed. The borrower is ****ed, because he/she thinks it's a "done deal" and has paid money for the appraisal. Plus our credibility is diminished.

This is already happening today. Do six to eight appraisals in a week with no estimated values or sales info given up front for MB's and 75% will be under the MB's expectations. The loan doesn't go through, the appraiser has been paid and the homeowner is calling and *****en that the value wasn't there, their loan didn't go through, and they want their money back. You'll never hear from the MB again and that HO will be calling weekly if not sueing you.
I just received two calls today from PO'ed HO's cause they're out $350 ea.
I could of told the MB up front the value wasn't there and he probably would of called back next week with another job, but I now know I'll never hear from him.

 

[Mike Kennedy]

Appraisers are hired to render a well-supported OPINION - not to ENSURE a loan goes through.

Find a Client.........not an abuser.

 

[Colorado Guy]

And what happens if after doing the inspection the appraisal now comes in lower. The MB is ****ed. The borrower is ****ed, because he/she thinks it's a "done deal" and has paid money for the appraisal. Plus our credibility is diminished.

This is already happening today. Do six to eight appraisals in a week with no estimated values or sales info given up front for MB's and 75% will be under the MB's expectations. The loan doesn't go through, the appraiser has been paid and the homeowner is calling and *****en that the value wasn't there, their loan didn't go through, and they want their money back. You'll never hear from the MB again and that HO will be calling weekly if not sueing you.
I just received two calls today from PO'ed HO's cause they're out $350 ea.
I could of told the MB up front the value wasn't there and he probably would of called back next week with another job, but I now know I'll never hear from him.

Gordon - I understand exactly want your are saying - but you have to ask yourself two quesitons:
1. What is my responsibility under USPAP?
2. What is my time, the five-years of storage, and the risk of a state audit worth?

I believe if you answer theses quesitons - you will come to a logically descison.

 

[Mike Kennedy]

Conduct (ETHICS RULE)

An appraiser must perform assignments ethically and competently, in accordance with USPAP and any supplemental standards agreed to by the appraiser in accepting the assignment.

An appraiser must not engage in criminal conduct.

An appraiser must perform assignments with impartiality, objectivity, and independence, and without accommodation of personal interests.

In appraisal practice, an appraiser must not perform as an advocate for any party or issue.

Comment: An appraiser may be an advocate only in support of his or her assignment results. Advocacy in any other form in appraisal practice is a violation of the ETHICS RULE.

An appraiser must not accept an assignment that includes the reporting of predetermined opinions and conclusions.

 

[Hiker]

Like I said, I could of told the MB up front the value wasn't there and he probably would of called back next week with another job, but I now know I'll never hear from him.

 

[Mike Kennedy]

Did you really want him to? Replace "it".

 

[Tazmaniac]

I don't think comp checks break the Ethics Rule if done competently. Yes it is an appraisal of sorts, but in this market the lenders have to know if their numbers have a chance of working. I always Ballpark it, and ballpark does not mean Highest. It means a broad range of value based on the info provided. And you must ALWAYS make clear to them that the information given is based on the information gathered and state where you are looking, as you have not inspected the property. Lookups are essential in todays market in order to succeed, unless your'e doing REOs or something of that nature. But they must be done in a competent manner the same as appraisals be done in a competent manner.

 

[Jo Ann Meyer Stratton]

If the research is completed per the appraiser's parameters or any other input from the appraiser--it is an appraisal which would require the appraiser to have a complete work file including a signed certification that is retained for five years.

If the lender asks for all sales in the subdivision and the appraiser doesn't make any judgment alls, then a list of those sales could be sent to the lender.

I have the following comment on my order form, policy statement, etc that I provide my clients or prospective clients.

"In Compliance with the Uniform Standards of Professional Appraisal Practice, the engagement and compensation of the appraiser in this assignment will not be contingent upon developing or reporting predetermined results, opinion of value or direction of value, attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of the appraisal assignment. There is a fee for all professional services rendered. In compliance with the Ethics Rule of the Uniform Standards of Professional Appraisal Practice as illustrated in Advisory Opinion 19, "comp checks", "pencil searches", "ballpark figure", etc will not be offered. A phased assignment may be arranged with payment of fees in advance and each phase of the assignment will not be contingent upon developing or reporting a predetermined result."

 

[Marcia Langley]

Like I said, I could of told the MB up front the value wasn't there and he probably would of called back next week with another job, but I now know I'll never hear from him.

Be sure you understand what the definition of an appraisal is.

Be sure you understand what USPAP says about developing, reporting, and retaining workfiles on appraisals.

Be sure you understand what an illegal contingency appraisal is.


Taz posted:

I don't think comp checks break the Ethics Rule if done competently. Yes it is an appraisal of sorts,

(my highlight)

It is an appraisal in fact. See USPAP's definition.

If done competently and ethically it will conform to USPAP including developing, reporting, and retaining workfiles and the fee will not be contingent on any outcome (including making the deal work or receiving future assignments).