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Third Exposure for USPAP changes expected

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Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
Saw where the Appraisal Foundation is taking comments on the second exposure for USPAP and a third exposure is forecast.

Just a thought - if the De Minimus is raised to the point that almost no properties require an appraisal that requires with USPAP, why bother with updating USPAP? Isn't that an exercise in futility? Or are we just talking 'job security' for the members involved?

Roger Strahan
 

Fred

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Jan 15, 2002
Professional Status
Retired Appraiser
State
Virgin Islands
The deadline for comments on second AQB expousre draft is Aug 15.
Where did you see something about a third USPAP exposure draft?
 

Terrel L. Shields

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Arkansas
>>are we just talking 'job security' for the members involved? <<

Yes, the ASB and AQB have outlived their usefulness for all practical purposes. The states don't need to have their hands held any longer, but the issue is tons of money accumulating from you and me in the form of our $25 registry fees that everybody is casting eyes on. Everyone is afraid any changes anywhere will result in that cash disappearing without them getting a bite. Subcommittee, Foundation, ASB, & AQB do this to justify their existences. They couldn't care anymore than the lawyer that got Alejandro Avila off from molesting 2 little girls cared that Avila went out and killed again. Its their job, and that justifies anything they do to keep it.
what would happen if the ASB sent out a memo that USPAP was "OK" and no changes were warranted. Do you think they would be around next year?
ter
 

John SRA

Junior Member
Joined
Jan 19, 2002
Mr. Strahan,

The Appraisal Standards Board has no current exposure draft. (I have verified this with the ASB Chair)

The current exposure draft was issued by the Appraiser Qualification Board. It deals with changes in the criteria to become a certified appraiser, NOT changes to USPAP.

Respectfully,

JC
 

Oregon Doug

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Professional Status
General Public
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Oregon
I have just received word that yes, it's true that the AQB is going to a third exposure draft.

It was also brought to my attention that the failure rate for the new USPAP instructor course was 42% and that as of now, there are only 135 qualified USPAP instructors in the US.

There are about 78,000 appraisers in the US who need the new course every two years (39,000/year) which means that each instructor needs to teach 289 students per year. Therefore, at an average class size of about 30 students, each instructor needs to teach the new USPAP course more than nine times every year.

Anyone else see a potential problem here?

Oregon Doug
 

Frederick R. Ruffell

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Jan 21, 2002
Professional Status
Certified General Appraiser
State
California
Doug you have forgotten about home study courses and on line courses for USPAP.
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Wasn't the AI instrumental in creating ASB and/or AQB :?:

Isn't the AI instrumental in creating their own data base :?:

It would appear the AI has outlived it's usefulness amoung it's members and the appraisal industry as a whole, along with some of it's other creations. The $25 per appraiser, per year is similar to a requirement for a landfill site, a monetary gain use only.
If we are the only ones who have to follow the guidelines and Lenders don't, whats the point :?: The Banking industry controls most of what we have to do, yet staff appraisers work under different rules while employed by Banks. Interesting isn't it :?


8)
 

Oregon Doug

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Oregon
Frederick: Because of the exam requirement attached to the new USPAP course, I don't believe that the new USPAP course can be approved for distance education (home study/on line) for CE requirements...good question for our next board meeting.

Oregon Doug
 

bradellis

Member
Joined
Jan 16, 2002
jtrotta,

Just to update you-

Staff appraisers who work for banks do not- I repeat- do not- work under any different rules. If you are licensed or certified then you must do your work in conformance with USPAP- period. No exemptions exist for staff appraisers.

In fact, when examiners look at the loan files and know up front that the appraisals are done by staff appraisers, they tend to look more closely at the appraisals.

My daughter is a staff appraiser. Her bank would routinely call me for answers to USPAP questions and the like. They absolutely try to get it right. Her boss told me that their staff folks kill many more deals than do the outside contract appraisers they use- by percentage.

When the loans go bad, as some do, the appraisal comes under detailed scrutiny. The secondary market asks you to buy the loan back- everyone but FHA/VA- everyone- if the appraisal is deemed to have been faulty.

Ask yourself this. If you were the appraisal manager at a bank and these loan repurchase requests showed a higher percentage of poor appraisals from staff appraisers than from outside contractors- how long would you keep your job?

You know the answer.

Now, are they subject to pressure from their LOs? Of course they are. But are not appraisers who work for mortgage brokers under the same pressure? More. They have no salary to fall back upon. Their income comes from commissions on the deals- yield spread premiums.

Sorry, J, but you have this wrong.

Brad Ellis, IFA, RAA
 

George Hatch

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Professional Status
Certified General Appraiser
State
California
Terrel,

If we're talking about cash being a big motivator for the Appraisal Subcomittee and The Appraisal Foundation, we should probably look at the numbers. The Appraisal Subcomittee subsists on the $25/year annual registry fee collected by the states from the appraisers. If you look on their website you'll see that their annual reports all have an accounting of how much money they take in and how they spend it.

Using the rough figure of 85,000 licensed appraisers, which I suppose probably includes some appraisers with multiple licenses (different states), and multiply that by $25/year, it amounts to an annual figure of $2,125,000. If you'll look at the annual budgets, you'll see that this is basically the amount they have collected every year since 1991. Of that money, about $600,000/year or so is granted to The Appraisal Foundation to partially offset their costs in funding those activities of the ASB and the AQB that are related to appraisal licensing and federally related transactions. That leaves the ASC with about $1.5 million a year to operate.

That's a lot of money to hand to a single person, but the ASC is not a single person. It's a federal governmental agency. My state appraisal board has a larger budget than that. Heck, my local water district has a larger payroll than that. Even those who despise the federal government would have to admit that any federal agency that can live on $1.5 mil a year can't be all bad. This agency deals with a very important aspect of our national financial structure. Using this perspective, the ASC is a bargain compared to other local, state, and federal governmental agencies.

There are undoubtably many government agencies that are nothing more than pork barrels to feed from, but the ASC is not among them. Nobody at the ASC (or The Appraisal Foundation, for that matter) is getting rich or even getting particularly well paid. The ASC certainly shouldn't be compared to a criminal defense attorney that gets a child molester off.

As to whether the individual state appraisal boards should be cut loose from all federal oversight and make all their own appraisal standards and licensing rules, thereby actually making the ASC and the AQB 'obsolete', that is another topic for another day.


George Hatch
 
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