"The appraiser wore no clothes - death trade"

[Elliott]

I'd like to see the study that is based on the billions saved by having an appraisal, where the appraiser let the clueless, cross-country lender know what a POS they would be lending on that eventually killed the loan, but saved the lender a boat load of money because the borrower claimed it was worth a ton of dough.

 

[Terrel L. Shields]

like to see the study that is based on the billions saved by having an appraisal

Can't prove a negative. Since these loans never make it past the round file, they are not part of the statistics.

 

[Elliott]

Terrel,
The purveyors of studies would have to actually think and design one. Its actually a 'glass half full' study. The 97% to 99% of standard, performing loans are an indicator that appraisals support the appraisal in the home loan process. We all know how well the liar loan program worked out. Who "saved" real estate values from 2007 to 2012 by properly reflecting the market?

 

[J Grant]

"Math (even in simple form) is the four letter word that most people hate to engage in, but accept as truth in a final analysis"

The above from the Buzz Article

Bernie Madoff's math ( and brokerage statements ) were impeccable, which is why he got away with fraud for so long. His math passed numerous audits, it looked that good. Math may add up and appear as "truth", but can be used to support a lie, or used to provide less than competent results even when no lie or intent to manipulate is present.

Seems the 50 PHD's working in Core Logic (referenced in an article) with their valuation programs are not faring very well. I ran RPR (core logic driven) off my MLS on two properties this morning, one on a subject I am appraising, the other on a comp, the value estimates on both were so off it was laughable.

It may come to pass that these vested interest parties with huge profit at stake may at some point persuade regulators to accept this spin as truth and succeed in their goal of marginalizing appraisers to role of data analysts, low paid of course. Way to go, Appraisal Buzz and JT, as always

 

[J Grant]

2 plus 2 equals 4, but does not "see" value or context or

2 fake diamonds + 2 fake diamonds =4,. 2 real diamonds + 2 real diamonds = 4, but with very different values attached. Even with a differential of all real diamonds, rote math does not tell us which of of the diamonds are better quality, or which might be stolen, or if ability to finance or how much supply and demand for diamonds influenced prices.

Math is number driven not value driven, even when it supposedly represents value. That is its weakness. All these decades of experts trying to tweak math to include value elements for software programs and they come up short. CMA, AVM, Zillow Zestimates, Core Logic RPR, etc none of them can make math properly factor in the disparate value elements and financing/market influences always changing and affecting real estate markets. Perhaps in other fields math driven results are highly applicable but the RE market is not like other fields.

The day when majority of buyers walk into a RE office and announce they want to buy a certain property because it is a "data point", and majority of sellers agree to prices because they are a "data point", is the day when data driven programs will be able to better analyze RE markets.

 

[factsandtruth]

They say appraisers are not competent but they want trainees to inspect properties on their on after 60days of training....!!!!

 

[Dale Smalley]

Zig Ziglar once wrote that if you put one foot in a bucket of Ice water and the other foot in a bucket of Boiling water on average you should feel fine.

 

[Terrel L. Shields]

Terrel,
The purveyors of studies would have to actually think and design one. Its actually a 'glass half full' study. The 97% to 99% of standard, performing loans are an indicator that appraisals support the appraisal in the home loan process. We all know how well the liar loan program worked out. Who "saved" real estate values from 2007 to 2012 by properly reflecting the market?

Fannie Mae and Freddy did not go under due to "bad" individual loans. They went bankrupt over their Mortgage backed securities purchased from the investment bankers.

 

[Walter Kirk]

Many of the deficiencies cited could be, and probably are, the result of lender pressure.
An appraiser doesn't get more orders if he "kills" deals so many appraisers make sure that their estimates of value meet or exceed
contract price. Many appraisers don't measure the subject or confirm comparable sales because they don't have the time to since they don't get
paid adequately after the AMC takes its large cut of the fee. I could go on but why bother?

 

[PL1957]

George Mann was the chief appraiser for a regional bank. I don't believe he ever saw an appraisal which met his standards, nor did he meet a single appraiser who was his peer. Very similar to Bob Parsons. Just be glad he's not a regulator.