The New Appraisal Industry

[Gooooose]

"Tons? " How do you claim to know that?

ok ok perhaps tons is an exaggeration. My apologies - simply an observation from discussions with local appraisers who have trainees. The trainees are the ones going to the properties and the supervisor is signing off on the reports.

 

[George Hatch]

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Bill Status of SB3235​

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SB3235 - 104th General Assembly​

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REAL ESTATE-DATA COLLECTOR​

Last Action​

2/02/2026 - Senate: Referred toAssignments

Senate Sponsors​

Sen. Bill Cunningham

Statutes Amended In Order of Appearance​

225 ILCS 458/1-10
225 ILCS 458/5-5

Synopsis As Introduced​

Amends the Real Estate Appraiser Licensing Act of 2002. Provides that it is unlawful for a person to act as a data collector without a license issued under the Act. Provides that "data collector" means a person who is hired by an appraisal management company or mortgage lender to inspect and collect data and pictures of a specific tract of real estate for the appraisal management company or mortgage lender with the intent of the data and information, which will be provided to an appraiser for the sole basis of preparation of an appraisal, to support a mortgage on the real estate.

Actions​

The states can do what they do but this raises some interesting questions:

There are no inspection-related requirements in USPAP aside from the appraiser disclosing whether they did or didn't personally inspect.

It's a violation of the ETHICS RULE to apply USPAP to non-appraisal activities. There's no such thing as a USPAP-compliant inspection service.

They're going to have to come up with a reference for whatever the consider to be a standard of practice for this service. They can't regulate the conduct without a benchmark for that conduct. They'll also need to establish QE/CE criteria, tests, and possibly an experience requirement.

Perhaps different in this state, but in my state's regs and those of every other states' regs I've see there's always been this (or a variation thereof) blurb:



I'm curious if anyone over there has thought any of this through. As I say, the states can do what they do. But I think it's going to take a lot more for them to build a position they can effectively regulate than simply adding a small section of regulation asserting jurisdiction over this activity.

 

[alebrewer]

Checks and balances. The GSE's want to increase risk to the homebuyer and the states want to safeguard the homebuyer. Seems logical to me. Setting up regs for inspection need not involve USPAP.

 

[George Hatch]

It seems to me that a state inspection board would be better equipped to establish and regulate an inspector-lite category along with their existing programs.

One thing about the scenario is that such a program would raise the barrier to entry for performing these services and increase the time/effort/costs to the individual to participate. Constrict the supply leading to an increase in the fees.

One other unintended consequence is that if a standard of practice for non-technical inspections is established the appraisers might be required by their users to adhere to those standards in their appraisal assignments, even if not otherwise addressed in USPAP or appraisal regs. An appraiser might not be able to do that without taking the QE.

 

[chad hampton]

That’s a nice Bill, but wait till the dirty scumbags of revaa get flown in to Illinois and start making deals. It is an interesting concept, though, you need an appraisal license to perform an appraisal inspection. hard to believe that would need a brand new bill in the legislature.

I’m certainly hoping for the best. Illinois appraisal board has done some good work over the years. I’ve just seen too much corruption to get too excited anymore. There’s quite a few examples of legislators doing the right thing only to have the political process take over at the last minute.

 

[alebrewer]

Quite possibly. In Texas, TALCB rolls up under TREC. I expect something similar for inspections might work (call it THILB if you want); let them roll up under TREC. The point about appraisers being required to adhere to inspection regs is interesting. Could be that 'either' license (appraiser credential or inspector certification) could satisfy the inspection experience/education requirement...

Correct about the point about increasing fees. When you increase the barrier to entry, you restrict supply - which generally results in increased fees. The neighborhood Uber driver couldn't just stop between Uber deliveries any longer... he/she would have to procure that Inspector credential.

 

[Dublin ohio]

As for the wife, I suggest "not" getting a new coffee maker for her on Valentine's Day... I don't think that would go over too well.

Yea that ranks right up there with a new vacuum cleaner

 

[alebrewer]

Yea that ranks right up there with a new vacuum cleaner

Unless she's Italian and you're getting a new espresso maker - then you're a hero (so long as you're the one making the espresso).

 

[George Hatch]

Appraisers don't get any technical instruction on inspections. There's nothing in the QE and nothing in writing about inspections in general other than ANSI itself which only pertains to measuring.

The first appraiser who gets yoinked by the state (and not a civil suit) for violating a documented inspection standard is going to set off some serious trauma leakage.

 

[Surf Cat]

Checks and balances. The GSE's want to increase risk to the homebuyer and the states want to safeguard the homebuyer. Seems logical to me. Setting up regs for inspection need not involve USPAP.

But but but....USPAP establishes that an appraiser "must" develop and communicate "a credible" opinion of value based on thorough research, analysis, and adherence to recognized appraisal methods.

The Appraiser "must" follow USPAP , PDC does not....yet appraiser "must" provide a credible opinion and value "based on" thorough research and analysis.....by the PDC....whom doesn't follow any guidelines.... Quite the conundrum....

I understand everyone here that's been doing this long enough can look at the data, without going to the subject, without driving the comps, can get pretty close forming an opinion of value.

The above said, how many times have you all set the appointment, have the comps picked out, have the appraisal form partially filled, and have a pretty good idea what the value is going to be.... then, completely changed your mind after inspecting this subject and driving the comps? This has happened to me a lot in the past. I'm in Los Angeles county, it's amazing what people do to their homes.