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Realtor Ethics

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The scrutiny and limits on # of trainees for appraisers is greater now than in the past, however the client ordering of fast/cheap is problematic. RE agents efforts at interference have had zero impact on that, it has resulted in certain clients imposing a 30 mile limit for appraisal ordering.

I certainly don't see RE agents as solving the problem, any positive impact their interference with appraisal matters will have a far greater negative impact. The stress and time wasting they wreak with their threats of filing complaints and sending poor data ROV is the final straw that has even more good appraisers exiting the field. RE agent/REALTOR forays into appraiser matters to date has been a disaster from the housing collapse followed when they controlled selection via mtge broker with rubber stamping of prices rampant, to their grabbing valuation business by doing BPO's for lenders on the REO and short sales that followed the collapse, to their winning the right to an ROV that is adding unpaid hours to appraisers obligations, to their covert arrangements with lenders for lists of go to number hitters to their bully tactics of refusing entry to appraisers to their media articles about how appraisers are slowing down the market by low balling, etc.

One only has to look at most MLS listings to see the ineptitude of agents regarding property. They list a condo as a townhouse if it has a townhouse design. They list above ground pool as it is is an in-ground pool. They call a corner of balcony sliver of view as a full ocean view. They add garages to living area sf. Same with guest houses. No negative feature of a property is ever mentioned, unless the property is a wreck and then it's called a fixer upper. Their comp choices on an ROV are a joke. Many of the listings are priced so badly they sit on MLS a year or more before finally reduced to a realistic price, or go into expired or cancelled. They add lot size to living area and divide that for a price per $sf of the dwelling. RE agents show such gross ineptitude regarding facts about properties it's incredulous to believe they are capable of determining appraiser competence ( besides the issue that it is outside their licence level, role as vested party and a lender allowing them to do has violated regulations)

I could see the lawsuits and restraint of trade complaints flying if appraisers took it upon themselves to vet RE agents for competence and blocking their efforts to list or sell property if we deem them incompetent or living too far from a listing .

Good stuff J. Please don't misunderstand me. I am in no way advocating re agents being the judge, however if they were to recognize gross incompetence and not be able to resolve the problem diplomatically through the appraiser or lender, then they might file a complaint through the commission and get rid of some of these incompetent low fee people calling themselves appraisers (some even without a trainee's license). I am in no way in favor of the crap that hard working honest, competent appraisers have to weed through from incompetent re agents and AMC's. Plus it looked like what DC was referring to was going through the local re board/commission, which I would think would not openly stoop to some of the tactics used by some unscrupulous individuals.
 
I am beginning to think some incompetent number hitters/fastest and cheapest that some AMC's have been and are after may be unregistered (not even trainee) minimum wage or less employees/contractors, maybe in another country.
 
I know, it is not re agents job to police appraisers, but how hard could it be for regulators to do? Come on, as well as they are trained at disciplining appraisers? Shouldn't be that hard to see if someone is following the law in appraiser selection. Especially now that the ordering is more centralized. I don't get it.
 
Good stuff J. Please don't misunderstand me. I am in no way advocating re agents being the judge, however if they were to recognize gross incompetence and not be able to resolve the problem diplomatically through the appraiser or lender, then they might file a complaint through the commission and get rid of some of these incompetent low fee people calling themselves appraisers (some even without a trainee's license).

I know you mean well with this post, and I agree with the end goal, but a realtor simply lacks the knowledge and authority to recognize and act on appraiser incompetence.

A realtor is not interested in a real appraisal report so any complaints from an agent should be taken with a grain of salt. Agents are interested in closing deals and collecting commissions not ensuring that a quality and non biased appraisal was conducted.
 
I know, it is not re agents job to police appraisers, but how hard could it be for regulators to do? Come on, as well as they are trained at disciplining appraisers? Shouldn't be that hard to see if someone is following the law in appraiser selection. Especially now that the ordering is more centralized. I don't get it.

I agree...the regulators are MIA, and imo it is deliberate...as long as lenders state they get "quality"" reports from AMC's (including their own AMC's ), the regulators don't want to look under the rock.

It would be a simple thing to audit AMC and lender ordering as to monitor which appraisers on a panel get work, and why, and how it relates to fee, experience and qualifications, . as well as outsourcing type ordering to national fee firms in bulk, where the blast email orders go that no appraisers manage to get no matter how fast they click etc .

The lack of a centralized, national complaint line dedicated solely to appraisers and offering protection and anonymity shows the regulators truly do not want to know what is going on.
 
I know you mean well with this post, and I agree with the end goal, but a realtor simply lacks the knowledge and authority to recognize and act on appraiser incompetence.

A realtor is not interested in a real appraisal report so any complaints from an agent should be taken with a grain of salt. Agents are interested in closing deals and collecting commissions not ensuring that a quality and non biased appraisal was conducted.

Depending on re agents is somewhat like trying to fight the taliban with a pea shooter. Enforcing appraiser selection laws would be more like a guided missle, bomb, and shouldn't have the bias problem if enforced by regulators. :)
 
I agree...the regulators are MIA, and imo it is deliberate...as long as lenders state they get "quality"" reports from AMC's (including their own AMC's ), the regulators don't want to look under the rock.

It would be a simple thing to audit AMC and lender ordering as to monitor which appraisers on a panel get work, and why, and how it relates to fee, experience and qualifications, . as well as outsourcing type ordering to national fee firms in bulk, where the blast email orders go that no appraisers manage to get no matter how fast they click etc .

The lack of a centralized, national complaint line dedicated solely to appraisers and offering protection and anonymity shows the regulators truly do not want to know what is going on.


It would be interesting to see who is getting the bulk of some AMC assignments and look at appraiser qualifications, turn times, fees, credibiity, reliability, geographical coverage, number of employees, number of people signing off on appraisal, etc.etc. A small group of regulators who were skilled appraisers could really do some auditing in a short period of time on an AMC to check appraiser selection criteria compliance and look for unfavorable trends/non-compliance.
 
I don't blame the agents for trying to dork appraisals - they've always done that. I blame (some of) the lenders for:


a) not doing enough of their own diligence with these appraisals, and

b) citing their lack of confidence as a reason for caving to the demands of the agent.


Like I have been saying, there are lenders out there who don't tolerate dumb appraisals in the first place and who also don't accommodate outside meddling with appraiser selection. That's the simplest solution.

Worrying about agents using value targets as their primary measure of appraisal quality is a waste of time. It's only a relevant point to the extent that the lenders allow them to do it.
 
Depending on re agents is somewhat like trying to fight the taliban with a pea shooter. Enforcing appraiser selection laws would be more like a guided missle, bomb, and shouldn't have the bias problem if enforced by regulators. :)

The best solution IMO is to address the problem ahead of time by wording the contract to indicate a local appraiser with X years experience will be recruited to complete the report. But agents don't want that. They want to be able to veto the appraiser chosen. They want to know if he's a number hitter or not.

In the eyes of an agent a local appraiser with 25 years experience could submit the most comprehensive and well supported 100 page report ever seen and if the number tanks their deal the "guy has no clue what he is doing."
 
I've had that several times. I remember one time I was appraising a house that had been somewhat overbuilt for its neighborhood of 900-1100 sf homes so I embarked on a survey of other overbuilt homes to see how they had done and used those as that basis for that portion of the size adjustments that exceeded the largest sizes in the neighborhood.

The loan originator sent my appraisal out to an SFR appraiser who made the comment - transmitted to me in writing - that as a commercial appraiser I wasn't sufficiently in tune with the market to know what I was doing, and here are three homes of comparable size that support the target value.

I strongly doubt I need to tell any of you about the nature of those alternate sales or the subdivisions they're located in.

BTW, that ROV never went anywhere, either.
 
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