The New Appraisal Industry

[djd09]

oh ok...when was the last 1004 you filled out...or the last AMC you worked for...i wont hold my breath for an honest answer

 

[John Hassler]

While some find the MB model undesirable, it was of significant benefit for consumers. The MB would have a loan packaged and ready to pit lender against lender with the winner being the borrower (and probably some extra big to the MB.

There was a statistic out circa 2012, after the MB system was all but gutted, that the spread between what the lender paid for money and what they sold it (their spread) at was at an all time high. This made sense since borrowers were effectively locked into a single lender instead of having a MB who had the ability to find the best deal.

The current system has been detrimental to borrowers.

 

[djd09]

Fannie Mae accepts the value estimate submitted by the lender as the value for the subject property. The estimated property value the lender enters in DU must be:

• based on the lender’s or borrower's estimate of value for a refinance transaction, or
• the same amount as the Sales Contract Price for a purchase transaction.

who needs appraisers...

 

[George Hatch]

oh ok...when was the last 1004 you filled out...or the last AMC you worked for...i wont hold my breath for an honest answer

True. I don't compete with the appraisers who specialize in those assignments. I'm not taking any assignments off their table.

I spent my time pumping out 1004s for the MBs and the GSE pipelines. I'm not going to apologize for later taking the financial hit and making the sacrifices it took for me to transition away from the GSE pipelines. It took me a couple years to do it and it cost me a certain amount of lost income to do it, but I came out ahead in the long run.

We all make choices and we all take risks.

 

[George Hatch]

Fannie Mae accepts the value estimate submitted by the lender as the value for the subject property. The estimated property value the lender enters in DU must be:

• based on the lender’s or borrower's estimate of value for a refinance transaction, or
• the same amount as the Sales Contract Price for a purchase transaction.

who needs appraisers...

Post the rest of it. Not just the application part in isolation of the "data driven analytics" that come next in their process. By which even you can understand is a reference to their usage of their internal AVM.

 

[Terrel L. Shields]

The entire sweatshop model that prevailed up through 2008 was built on the backs of unsupervised trainees

It happened here, but not to the extent you experienced in CA perhaps. There were basically 2 local appraisers with a sack full of "trainees" doing the work while they only checked for mistakes or assisted when asked. But faced scrutiny from regulators but never lost their licenses. Their trainees lasted an average of one year or less before the honest ones figured out they were being used and certifying lies.

I hired one and when she went to get her license, she had signed the report as well as the super, but we were double checking her comps, and he had substituted a comp she was not familiar with. We drove to find this comp and it flat out did not exist. He created it out of whole cloth with fake data to hit the number.

FHA finally caught on and this trainer got eliminated from their Roster. The other one was going thru a mortgage broker he was apparently having an affair with, and she ended up getting blacklisted by FHA as well. He escaped that sanction but sold his company to a trainee working for him who promptly ran the business into the ground when the crash occurred.

Otherwise, I don't know any of the trainers who were deliberately being fraudulent although a couple of folks were clearly incompetent with or without a trainee. And the worst of them did reviews. I had to laugh at a couple of reviews they did. One was to change the value by $2,000 but they also substituted a comp that had a basement apartment being rented. They completely missed that the house had a basement although both the MLS and assessor listed it, and obviously did not know that it was rented. I knew the renter and the home seller because I had appraised the sale.

 

[djd09]

Post the rest of it. Not just the application part in isolation of the "data driven analytics" that come next in their process. By which even you can understand is a reference to their usage of their internal AVM.

when they say lender...that is really the MB you hate so much...read and weep

 

[George Hatch]

While some find the MB model undesirable, it was of significant benefit for consumers. The MB would have a loan packaged and ready to pit lender against lender with the winner being the borrower (and probably some extra big to the MB.

There was a statistic out circa 2012 that the spread between what the lender paid for money and what they sold it (their spread) at was at an all time high. This made sense since borrowers were effectively locked into a single lender instead of having a MB who had the ability to find the best deal.

The current system has been detrimental to borrowers.

Their economic interests don't count in the safe/sound lending matrix, either. Same as the lenders' savings WRT outsourcing 100% of the appraisal process. They weren't even doing a pass-through of those costs or any of the accounting or payment processes. Those MB-controlled appraisals literally WERE 100% free to the lenders before the HVCC and D-F got to them.

 

[George Hatch]

when they say lender...that is really the MB you hate so much...read and weep

MB don't sell loan packages to the GSEs. They sell to an actual lender who then sells to the GSE.

 

[djd09]

so...they estimate value without a license or USPAP