The New USPAP

[DWiley]

oh this is comical...

The homeowner and the lender had a different view.

 

[djd09]

The homeowner and the lender had a different view.

i cant stop laughing...oh the poor lender should of qualified the appraiser or you should have approved the waiver

 

[George Hatch]

^^^ That's another argument that you keep making in bad faith. You already know the decision process includes an internal valuation and that nobody is operating primarily off the borrower's opinion. .

 

[djd09]

yeah i know the borrowers were too risky like marin city and obviously they were not friends of fannie...

 

[djd09]

the cheap and fast whining about quality...just reaping what you have sown

 

[RCA]

USPAP is about appraiser conduct. What the appraiser actually did or didn't do.

That's an extremely superficial statement and also largely incorrect.

If public records has an error the source of that error is in the public records. MLS, building permits, surveys, title reports, termite reports, whatever - none of those data sources can be considered perfectly accurate on the 100% basis.

Measurements are never 100% accurate. It is a question of degree. One of the many flaws of USPAP is that it never answers the question: When is a measurement better than no measurement at all? That is a VERY good question that no one has answered. Douglass Hubbard would take a very loose approach here: Even rough approximations are better than none - and his whole methodology is based around that. And he has many followers, including the military.

If an appraiser uses that information there is still an error, but the appraiser isn't the one who made the error.

He may indeed be the one who made the error. What difference does that make. It goes back to the previous issue. In other words, Appraisers should be able to use approximations if that is the best they can do and it is "good enough". -- But, again, what is good enough?

It's a standard assumption that we assume the information being used is true and correct,

That's very crazy. We assume rather that that is the best information available and it helps rather than hinders the appraisal process.

and we explicitly assert that in our SR2-3 certifications. "to the best of my knowledge and belief".

Yes.

Where the definition of "misleading" that they were using becomes a problem is that "...unintentionally misrepresenting, misstating..." clause.

For example I have a very useful comparable, but the GLA is missing in the MLS. I can however go to Earth.Google.com and estimate the GLA roughly from the approximate dimensions using the Google measure tool. Is that good enough? Is it misleading? See --- you cannot answer the question, can you? You don't have a clue. Neither does USPAP.

Dumbos.

There is a misstatement, it was unintentional on the appraiser's part, it is often beyond the control or the knowledge of the appraiser but under this definition it could still be attributed to them by someone acting in bad faith.

As an illustration of the controversy,
djd09 has USED that definition - in bad faith - many times on this forum to say that if a 3rd party inspection has an error and the appraiser relies in part on that information in a desktop SOW assignment then the appraiser was "misleading". His interpretation of it is that the appraiser is 100% responsible for the accuracy of the data regardless of its cause or source.

Does USPAP give us a standard for when to trust a source of information? A solid standard or protocol that works in this hybrid case. I don't think so.

Regardless if the ASB ever intended the term to be interpreted that way, the manner in which it was worded enabled djd09 and others who want to act in bad faith and under the logical disconnect to use it that way despite the open, notorious and universally accepted common sense reality that appraisers use imperfect data all the time. In spite of the fact that appraisers qualify their usage of the information by disclosing "to the best of my knowledge and belief". Despite the point that it's impossible to perform any appraisal without the use of assumptions in lieu of certainty with some of this data. If we had to be 100% certain of every fact in support of an appraisal we wouldn't be able to complete any assignment.

100% happens with respect to some logical statements like "Did you see a house or property X when you visited it, Yes or No?" But your answer to the question: "What is the GLA of the house location on Property X?" can never be 100% perfect because measurements cannot be 100% perfect. USPAP does not define this ****. The GSEs via ANSI give us a standard for length measurements that is within one inch or 1/10 of a foot, with exceptions allowed. That's not bad. For those exceptions it is implicitly: "Do the best you can." But there is no standard for the accuracy of the computed GLA - which must take into consideration exclusion of certain areas. So even here, with the exemplary standard, long-time coming, we do not have 100% accuracy. Don't downplay this problem, btw. Because when it comes to regression on 100+ properties, we have to live with missing information and approximations of some properties under the "best we can do." premise. --- And thereby skirt the fact the USPAP has nothing to say about these issues.

That's why some appraisers disagreed with the manner in which that definition was worded. And as it turns out that includes at least some of the appraisers serving on the ASB.

In many cases, I am sure for the wrong reasons.

You should always have some engineers and scientists involved in standards, who are also somewhat familiar with the subject matter of appraisal.

 

[George Hatch]

Regardless of your desire to import engineering standards into the appraisal profession the point remains that appraisers don't generate or control or have any means of validating to an engineering standard the comparable data they use in their appraisals. There is no universal external standard that applies to how that information is generated at it's source.

 

[djd09]

wait until the unethical stakeholders adopt green building standards via SOW rule...it will be shock and awe for appraisers and the public alike..and USPAP will remain shamefully silent

 

[djd09]

who needs TAF...let ansi write the standards with fannie exceptions wtf

 

[George Hatch]

Doesn't solve any aspect of your objections. Standards are written by people and those people will have all the same human frailties as any other group of people. They'll have to take into consideration what it takes for an appraisal to be useful to its users which means at least listening to what all the different types of users think that "useful" means to them. Same as applies to the GSEs, the activities of which you are also critical of. The standards will still be enforced, it will still be people enforcing them, and those people will be selected by other people who may or may not know what they're doing when it comes to appraisals.

And after all that you're still never going to get the back-to-the-2005-market for appraisal services that you want. It won't happen because it can't happen.