SuggestionsWanted.

[J in Florida]

Great.

Get ready for it folks, there will be a LOT more of this coming. Her (and any of our) report could be a tight as a freaking demo, but it won't matter. She'll (we'll) still have to spend time and money to defend it. This could happen to any report any one of us have done since the run-up started until the top of the market. We were barely paid enought to do the report in the first place, now we'll have to spend time and money, and get paid nothing, to defend it over again with the proverbial fine tooth comb.

This is why I don't feel the borrower should even get a copy of the appraisal (nor should they be required to pay for it). I understand the argument of skippy being able to hide behind the intended user language, but we are all targets for lawsuits on every report we do. Those $200 AMC 24-48 turns with the possibility of being sued sound real attractive, huh?

 

[Couch Potato]

Get on the bandwagon and hire a lawyer to sue your insurance company?

How could the insurance company refuse to represent an appraiser client who is being sued for fraud if the fraud allegation has not been tested? Is it possible that the carrier reviewed the allegations and the appraisal and find that the appraisal has the potential for fraud?

This concerns me because I don't understand the nuances of my own policy or the E&O industry.

Thanks.

Fraud is not covered under any insurance of which I am aware. Money to pay for a lawyer in such cases should be calculate in everyone's fee structure. Remember the time to build a relationship with a good lawyer is before you need them. If you don't understand your insurance policy, consult an attorney so that you do understand.


I agree with the advice to get a review done on your work by an appraiser with which you have no relationship. A reasonable judge will likely toss the case against you if you have clear evidence you did nothing wrong. Then again, a review could show you screwed up and should try to settle ASAP. Either way, an independent opinion on your work would be invaluable to your case.

 

[ZZGAMAZZ]

The salient point is that the carrier doesn't represent an appraiser whose work is fraudulent. The carrier does represent an appraiser who might be guilty of negilgence, or incompetence by error of commission or ommission.

There must be an intermediary procedure in place for the carrier to determine whether the allegations are material. Otherwise every suit would allege fraud rather than negligence.

There must be an arbitration protocol for the appraiser to find out why his carrier is refusing to represent him. Otherwise why carry E&O insurance?

 

[Couch Potato]

The salient point is that the carrier doesn't represent an appraiser whose work is fraudulent. The carrier does represent an appraiser who might be guilty of negilgence, or incompetence by error of commission or ommission.

There must be an intermediary procedure in place for the carrier to determine whether the allegations are material. Otherwise every suit would allege fraud rather than negligence.

There must be an arbitration protocol for the appraiser to find out why his carrier is refusing to represent him. Otherwise why carry E&O insurance?

No, fraud is much harder to prove and the person filing suit is far less likely to get paid suing an appraiser for fraud. Only an idiot sues an appraiser for fraud.

 

[Greenback]

...They allege that I inflated the value.

Depending on the competency of your state board, you may go as far as asking the board to investigate your work. Then, if you are ticked off big time, reverse the accusation in your favor before they can get another leg to stand on (attack them before they keep attacking you).

If I was accused of inflating value, I would want a highly reputable appraiser defending me or a reputable state board. I don't see a Lawyer being competent enough to prove inflated value of an Appraisal, unless the reporting was so obvious common sense would directly point it out.

I think its safe to say that the majority of so-called professionals that work within the industry cannot even read an Appraisal, thus fully comprehend them.

I would base everything I did on socio-economic behavior and economics/land economics. The accusation of an inflated value of an Appraisal is basically saying, they are more educated than you in land economics and can prove you wrong in the Real Estate Market Place no matter what. Its my opinion that, Lawyers don't practice land economics, much less a typical borrower. Use what you know? I would.

Just my opinion,
Goodluck to you..

 

[The Warrior Monk]

The homeowners are not your client, nor did you perform an appraisal for them.

How does your state handle privity?

 

[ZZGAMAZZ]

To the OP: Did your insurance carrier tell you why they were not represent you?

 

[Deleted member 80407]

Nancy,
When did the NJ market peak? When did values start correcting or declining? If your market peaked in 2005 and the property was purchased in 2005, then maybe the improvements made after the purchase did not add any value what so ever but rather washed the decline in value within the market. Knowing the answers to the above questions will help to determine a frivolous complaint.

Example: If property was purchased for $500,000 in 2005 and the market has declined 10% between 2005 and 1/07, an investment of $50,000 in remodeling would be washed by the decline in value.

Did your report contain any comparables or paired sales supporting a gain in value (past sale to current sale) from remodeling?

 

[Michigan CG]

Nancy, before you post any more please PM or e-mail me.

Thank you.

 

[c w d]

Nancy, remember, anything you say here can and most likely will find it's way into your case. I would not get as specific as discussing the details on an open forum.