"REVIEW Appraisals" are back-in favor during these Slow-Times > USPAP Violations > State Boards

[Sadie]

To wit:
Now under Federal law, if a lender, Fannie Mae, or any other person becomes aware of USPAP violations likely to have an impact on the value conclusion, then the appraiser must be reported to appropriate state licensing agencies.

Take from the article whatever you like. The logical rendering of the above sentence is as follows: If any other person becomes aware of USPAP violations, then the appraiser MUST be reported to the state" Which is absolutely incorrect. Random folks cannot be required to turn appraisers in to their respective states for investigations.

I kind of wonder if the article isn't a little bit of fear mongering. The ability of any random turning an appraisal in has always been there. The requirement is new, but with the caveat the rando must be aware of a USPAP violation as it would relate to the MVE. Thats a kind of specific random person IMO.

 

[ramrcdk]

This is a correct assumption. My mentor whom is an AG, took a gig with an AMC to do “spot check” reviews a few years back. He thought it would be easy cash however, being from an AMC, they want so many per hour.

It worked out if the appraisals were well supported, bracketed, etc. As you can probably already guess, most were not. All these appraisals had so many problems, so many errors that he couldn’t give them a pass. It was like this….

He didn’t last a week.. Lol

Was your Mentor required to ... did he 'turn-in" those Failed Appraisers? < a week, likely he didn't have the time.

I find the Article in WRE, although mindful, to be more of Advertising for an Instructor's Class.

 

[TerryRohrer]

Dodd-Frank, enacted in 2010, included the following provision, which I expect is the basis for the statement in the article:

‘‘(e) MANDATORY REPORTING.—Any mortgage lender, mortgage
broker, mortgage banker, real estate broker, appraisal management
company, employee of an appraisal management company, or any
other person involved in a real estate transaction involving an
appraisal in connection with a consumer credit transaction secured
by the principal dwelling of a consumer who has a reasonable
basis to believe an appraiser is failing to comply with the Uniform
Standards of Professional Appraisal Practice, is violating applicable
laws, or is otherwise engaging in unethical or unprofessional conduct,
shall refer the matter to the applicable State appraiser certifying
and licensing agency."

 

[glenn walker]

Was your Mentor required to ... did he 'turn-in" those Failed Appraisers? < a week, likely he didn't have the time.

I find the Article in WRE, although mindful, to be more of Advertising for an Instructor's Class.

Our legal said it was not our scope of work to decide wht is turned in . Its the Lender who has to make that determination. Its also opens up lawsuits against the reviewer because yes reviewers also get sued and their reviews are often turned into State Boards. No way all I did was report what I found and Bigger Bank USA can determine what to do with it. Can you imagine making 100 complaints a year, also making sure your review work fie is in order and your Review is also USPAP Compliant. Often the "Hunter Becomes the Hunted" No thanks LOL

 

[ramrcdk]

OP re-worded the article...

Edited the Thread-Post
BECAUSE although I copy-pasted the Article correctly, an error by the author of the WRE Article.
As intended, by viewing The Article.

Point: be mindful to carefully "review" your own Reports, don't be a Tier 3,
&
if review ramps-up Performing Appraisal Review Assignments may be the EXTRA Income you need!

 

[Dublin ohio]

That's not to say that folks who don't know appraisal terminology or methodology may misconstrue stuff, but that's why the state has investigators.

ANSI requirements come to mind. But like you said. That's why the state has investigators. I have had numerous conversations over the years with various of our state investigators. Although it is not an "official" policy. They do try to separate the "wheat from the chaff" when it comes to complaints.

 

[Vermonter]

I kind of wonder if the article isn't a little bit of fear mongering.

Every article ever written related to the appraisal industry will always contain a large amount of fear mongering

It's just the way it is

 

[BRCJR]

Dodd-Frank, enacted in 2010, included the following provision, which I expect is the basis for the statement in the article:

‘‘(e) MANDATORY REPORTING.—Any mortgage lender, mortgage
broker, mortgage banker, real estate broker, appraisal management
company, employee of an appraisal management company, or any
other person involved in a real estate transaction involving an
appraisal in connection with a consumer credit transaction secured
by the principal dwelling of a consumer who has a reasonable
basis to believe an appraiser is failing to comply with the Uniform
Standards of Professional Appraisal Practice, is violating applicable
laws, or is otherwise engaging in unethical or unprofessional conduct,
shall refer the matter to the applicable State appraiser certifying
and licensing agency."

key is "consumer credit'. D-F relates to owner occupied residential dwellings.

 

[BRCJR]

XVIII.Referrals
An institution should file a complaint with the appropriate state appraiser regulatory officials when it suspects that a state certified or licensed appraiser failed to comply with USPAP, applicable state laws, or engaged in other unethical or unprofessional conduct. In addition, effective April 1, 2011, an institution must file a complaint with the appropriate state appraiser certifying and licensing agency under certain circumstances.
An institution also must file a suspicious activity report (SAR) with the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN) when suspecting fraud or identifying other transactions meeting the SAR filing criteria. Examiners finding evidence of unethical or unprofessional conduct by appraisers should instruct the institution to file a complaint with state appraiser regulatory officials and, when required, to file a SAR with FinCEN. If there is a concern regarding the institution’s ability or willingness to file a complaint or make a referral, examiners should forward their findings and recommendations to their supervisory office for appropriate disposition and referral to state appraiser regulatory officials and FinCEN, as necessary.

Mandatory reporting -

(1) Reporting required. Any covered person that reasonably believes an appraiser has not complied with the Uniform Standards of Professional Appraisal Practice or ethical or professional requirements for appraisers under applicable state or federal statutes or regulations shall refer the matter to the appropriate state agency if the failure to comply is material. For purposes of this paragraph (g)(1), a failure to comply is material if it is likely to significantly affect the value assigned to the consumer's principal dwelling.
(2) Timing of reporting. A covered person shall notify the appropriate state agency within a reasonable period of time after the person determines that there is a reasonable basis to believe that a failure to comply required to be reported under paragraph (g)(1) of this section has occurred.
(3) Definition. For purposes of this paragraph (g), “state agency” means “state appraiser certifying and licensing agency” under 12 U.S.C. 3350(1) and any implementing regulations. The appropriate state agency to which a covered person must refer a matter under paragraph (g)(1) of this section is the agency for the state in which the consumer's principal dwelling is located.

 

[Terrel L. Shields]

Federal law states that all rappsaisls must be "reviewed" is toothless as a "review" can be a QC only compute or clerical staff checklist.

exactly - and the smaller the bank the less likely these "administrative" reviews are very thorough. A more detailed "technical" review might uncover more errors.

Not sure about other States.

Anyone can file a complaint in Arkansas and Oklahoma...anyone. And at least in AR it can be anonymous. A fellow in Hot Springs had a complaint filed against him, was sanctioned, appealed to a court and beat the board, yet at no time did anyone know (apparently) who turned him in...