REVIEWS

[jtrotta]

There has been many a discussion on this item, mostly from folks that stumbled upon someone else's work and then made a review of their own, because the product had been supplied. I have been of the opinion, that when you "PEEK" you are not suppose to. 8O

In the new 2002 "USPAP" it clearly states what a "Review" is and what specific's surround it. I would advise everyone to become familiar with it and follow it's definition. Also, it specifically points out the "Competency Rule" in the review process. :x

*Attention should also be paid to the section regarding;

"The Appraisal Review Requirements In This Standard Do Not Apply To" 8)

 

[George Hatch]

I'm not sure I'm following you. You are apparently referring to lines 1124 - 1130 in the 2002 edition:

"The appraisal review requirements in this standard do not apply to:

The activity of review or audit in the context of other professions, such as accounting;

An appraiser's study of work prepared by other types of experts, such as engineers or other consultants, or to work prepared by an appraisal consulting assignment under SR 4 and 5;

and review of an appraiser's work by non-appraisers, such as in an adminitrative review."


So in the first case, our definition of "review" is not the same as may be used by other professions, such as accounting. We have our own definition.

In the second case, "appraisal review" is not the same thing in USPAP as "reviewed the engineeer's report' or "reviewed the title report". In other words, SR-3 doesn't apply to non-appraisal work, not even another appraiser's consulting work as defined in SR 4/5.

In the last case, SR-3 does not apply to administrative reviews. As professional appraisers, we would seldom have occasion to do an administrative review unless we were engaged in some kind of non-appraisal activity. An example of this would be if I had both an appraisal license and was a mortgage broker, and was reviewing an appraisal for one of my loan packages to decide which program to fit it into. That would be an administrative review because I'm a user, not a reviewer. Or if I were purchasing a complex property type that I am not familiar with and I wanted to know what the pros think. Again, it's an administrative review because I'm a user, not a reviewer.



To ask a related question, let's say a client or a relative shoves someone else's appraisal report in front of an appraiser and asks for their opinion. The appraiser takes one look at it, spots some obvious 'flaws' and comments "This is crap, burn it". I would say that that appraiser just made a review, the only question being did they go through all the steps necessary to develop a credible opinion (3-1) and express that opinion the way its supposed to be communicated (3-2 and 3-3).

This scenario is related to the appraiser who is asked to express an opinion of value over the phone on a property they have never actually seen. They are still responsible for that opinion of value and the report, even if there is no contract for services.

The implication I got from your post was that if your client provides you with a copy of someone else's appraisal report, you are somehow spying or otherwise violating the Confidentiality section of the Ethics Rule in USPAP by looking at it and developing and communicating a review on it. I would disagree with that line of thought because the client is allowed to give you the report (its their's to do with as they will), you are not violating Confidentiality in speaking or reporting anything to your client, and you have no obligation for confidentiality with respect to the original appraiser. Handing the report to the approriate regulatory agency shouldn't be a problem either, as long as it came into your hands legitimately. That said, I'd get the client's permission before I sent it up.

Whether we like it or not, our work gets compared to the work of others, particularly in the case of 'duelling appraisals" on the same property. We need to have the means to defend ourselves and the public against the bad actors within our ranks.


On the other hand, I may have just misinterpreted your original post and went off the deep end. If that's the case, let me apologize up front.

 

[jtrotta]

George no you didn't; but since you asked The first sentence under the heading "Standard 3:" says- "In performing an appraisal review assignment" and this is where I have a problem; if the Lender passes along someone else's work and has not asked you to perform "an appraisal review assignment" why does everyone here feel they have the automatic right to perform a review??? 8O

Now to me it gets sticky from that point, as you have not been asked, but the Lender has supplied you and you, yourself and your ego have decided that this is "your job" to do, when it is not :?

To go a little further; we then go to the "Competency Rule" which clearly states; applies to the reviewer (who was never asked to perform a review), who must correctly employ those recognized methods and techniques necessary to develop credible appraisal review opinions and also avoid material errors of commission or omission. (If you were not given the "appraisal in question" as a review assignment - are you not now in viloation, as you have pre-determined negativity in that report??) and the last line is- A misleading or fraudulant appraisal review report violates the "Ethics Rule".

It is my opinion that if do not have an assignment order to perform a Review, you should not even peek, but return the report post haste. Of the 20 years in the busines, I have been offered other reports to pre-view, but to date have never accepted any; the fellow I originally worked for pounded that into our heads before anything else; his basic theory was; if some of the information is wrong, you've already wasted your profit time on something that is insignificant; get it right from the start and you won't be re-writting this report 2 & 3 times. And most importantly your suppose to arrive at a value without "bias", when you pre-view someone else's work you have sub-consciously absorbed that data and it is no longer your unbiased opinion. 8)

 

[Ray Ohler]

Great solution here. Let all the mortgage brokers (unlicensed and otherwise) and "desperate" homeowners get out oujii boards and AVM's to "assess" loan security and DISMISS all the appraisers, a lot of which couldn't qualify for a job at a convenience store. Let all the "public" companies "shred" all the documents they want, HEY, wait a minute, with "E-Commerce" they won't have to do that. Press a button, IT'S GONE. Back-ups didn't work. "IT'S NOT OUR FAULT, IT'S THE TECHNOLOGY". Millions, make that BILLIONS disappear. So what, is it YOUR money? I only made 264 million, so pay a little fine, do 21 months in a domitory, pay some "forgotten" taxes AND LET THE TAXPAYERS PICK UP THE BILL.

 

[jtrotta]

Ray, what are you talking about, did you inadvertently leave the planet ole boy 8O

Whatever it is your smokin, :lol: put it down it's caused way to much damage already :lol: :lol: Take a few days off and chill 8)

 

[Ray Ohler]

I need to take a course in self-brainwashing.

 

[Tim Hicks (Texas)]

I agree that if you have not been asked to do a review on a report, you should not. I, see nothing wrong with accepting another appraiser's report, because I have the ability to complete an unbiased appraisal no matter what is furnished to me. As I see it, Mr. Trotta, the second appraiser is usually furnished the first appraisal when they don't come in at the nice lofty value that the first one did anywhere from 0-3 years ago. It is very discouraging going behind another appraiser that has "raised the bar" for whoever. The second appraiser should be able to tell the lender, borrower, whoever why their opinion is lower than the last. I don't believe that you should perform an appraisal review, but you can explain why you used the comps in the neighborhood and he/she did not or how they mismeasured the home or etc. I really don't believe that we are on witch hunt on this forum. I do believe that if you see another appraisal that was fraudulently done, you should request that the lender give you permission to send it in or they send it in to the state. I have never gotten permission and I haven't pursued it, but how else will these appraisers be stopped? We live and work in a society where the foxes are asked to guard the henhouse and doing nothing is just as bad as doing the wrong thing. My opinion, of course, I could be wrong and it would not be the first time.

 

[jtrotta]

To Ray; I needed that :lol:


Tim, I'm not on a soap box, and I do not reach any bar, if the deal doesn't fly, let'em get someone else. I will provide a Review under those guidelines which we are to adhere to and if it's "Fraud", I will do my best to prove it; but if a Lender supplies you someones else's report, for whatever reason and you keep it & read it and they are not issuing the report "As a Review Assignment" it does not fall under the -Specifics of the Review Process- as noted in USAP, is all.

After all we are all "pursuing the appraisal practice" aren't we???

 

[Steven Bonner]

jtrotta, I think you make a good point. When we are given a report to "look over and comment" on, usually as a result of our reporting a lower value, too many will do just as instructed and comment on another appraiser's work product. That is called a review and brings on all the USPAP requirements, whether we comply with them or not. And if the other appraiser is confronted with a statement about his work that came from the second appriaser, he could have a case against that appraiser. I recently started a thread on this subject, on the old board, and got a lot of helpful perspectives. Since that time I refuse to comment on another's work even when it is totally opposite of mine unless they are willing to order a review. However, I can and do comment on my work, like I don't select the highest priced sales I can find when they are not similar to the subject, I do strive to use sales that are as comparable to the subject as possible and I do not start with a predetermined value and make the report fit it.

Having said that, I believe I am a better appraiser after reviewing and viewing the work of others. I have learned some things from others, both in what to do and what not to do. But mostly I have felt better about my work after seeing that of some others. I think that is fairly typical of review work, since we generally get work that has red flags flying all over it. I have even seen reports prior to me doing mine and found interesting opinions that I sometimes agree with and sometimes don't. It's kinda like the homeowner asking, should I tell you this or that? I tell them, sure, but it may or may not make any difference. I see my primary valued skill in trade after knowledge to be my objectivity. I get paid the same thing regardless of the reported value. If the value is not there, blame it on the market not me. Objectivity is a skill I often see absent in the work of others. Theoretically your position is right but I suppose it depends on the appraiser and his objectivity as to whether he should allow himself to see another report before he does his. A wise man knows his limitations.

 

[jtrotta]

Steve; for the most part I agree and if it is so that a Lender asks you to look at anothers work "after" you've completed yours, (your unbiased opinion has already been rendered) I have no problem with that, as you may and will discover why there are differences. Because this has taken place after you've turned in your report does not cause a problem (at least for me-I just point out the differences and leave them to decide for themselves) If asked by the Client to do this, you are crossing the first bridge in the line of "Defense" of your report, make a note of it on the file cover for future reference if necessary-for your E & O provider. From the many chats here (Forum) in this area, it's the :x "Prior To" :x doing the assignment I have a problem with. Regardless of what anyone says, when you see someones else's work, you immediately look for the flaws and mentally decide if it fits within the complex USPAP & FNMA guidelines you've been taught over & over & over again, sort of the nature of the beast-we're trained to do just that.