Tidewater Initiative Question?

[nicholz12]

I have almost 20 years on the VA fee panel...doubt I will quit. What I was saying is...If you don't agree with the VA appraisal policies that is an option.

You're right... I doubt I will quit. But, I've pondered this question re- VA JE for some time and actually brought it up w/ VA... I didn't get much out of their response.

 

[Calvin the Airedale]

We all acknowledge that the VA possesses JE should they choose to use it. The question is have they ever done so as regards TI?

Scan the AF website or publications for their opinions on TI. The AF's approval is based on a conversation between two people, Brenan & Kifer, held off record.

Contrast the TI decision with the hand wringing and committee meetings that go on at AF for almost every other decision and pronouncement and tell me how normal its approval seems.

 

[Don Clark]

We all acknowledge that the VA possesses JE should they choose to use it. The question is have they ever done so as regards TI?

Scan the AF website or publications for their opinions on TI. The AF's approval is based on a conversation between two people, Brenan & Kifer, held off record.

Contrast the TI decision with the hand wringing and committee meetings that go on at AF for almost every other decision and pronouncement and tell me how normal its approval seems.

Then why not refer this question to the AARO or your state regulatory board? The state regulators are the only ones who have enforcement powers. So far I know of no state that has been concerned about the matter. Almost all the concern has come from appraisers, mainly those who are not on the VA Fee Panel.

http://www.aaro.net/

Since I have been involved with the TI since it's beginning, and before it was VA policy nationwide, I believe it is consistent with the minimum requirements in USPAP. Others disagree, and that is their right. But, to continue to argue the point on this forum is a waste of time and will lead to no resolution. Someone has said to keep doing the same thing over and over expecting different results from what you have had in the past.....is the mark of insanity. I don't know. I just believe that we shoud agree to disagree and move on.

 

[Jim Onderisin]

It's called the Golden Rule....them what's got da gold makes da rules!

The entire intent was to circumvent the "reconsideration" process for the VA staff at the regional offices. Prior to Tidewater, the appraiser would complete the appraisal and submit the report to the VA. The VA would then send the appraisal report to the lender. The lender would then notify buyer that the property did not appraise for the contract price. The buyer's agent would then notify the listing agent who would notify the property owner. The agents involved would discuss the appraisal and if they believed the appraiser erred someone would submit a request for reconsideration to the VA who would then notify the appraiser. Very cumbersome.

With Tidewater the appraiser notifies the SAR (staff appraiser reviewer) directly and holds off on sending the appraisal report for up to two days. The SAR contacts the loan officer who contacts either the buyer or the buyer's agent who calls the listing agent who then submits a whole laundry list of sales to the appraiser...most of which are not comparable. The appraiser looks over the data, finds no support for a value change, adds comments to the appraisal report about what and why and sends the report to the VA. The only difference? The VA isn't in the middle of the process making their (VA) job easier and putting more on the backs of the appraisers.

Does the process violate USPAP? The VA and Appraisal Foundation says no. Supposedly the reason being no value is indicated and there is no report. Purists say Yes because the appraiser has communicated a "verbal" appraisal with a "less than" the contract price. The VA counters with...'we have jurisdictional exception which trumps USPAP".

Does this put a target value before the appraiser? Yes, in my opinion but then so does having a contract price in the first place. Does it compromise the appraiser's independence or bias the appraisal process? Probably. Does anyone really care? Only the appraiser apparently. Regardless of how we feel or what we believe is really right it is the policy of the VA and we live with it...or quit.

There is also another current issue concerning appraisals done for the VA which is probably contrary to USPAP. That concerns liquidation appraisals where the VA has instructed the appraiser put None for the name of the borrower and None for the name of the lender/client on the appraisal report. Many of us believe this is misleading and contrary to USPAP. Again...another Golden Rule!

Cheers, Mike

Mike: You present a good summary of and rationale for the Tidewater process. However, the process doesn't compromise my independence, and I speculate it doesn't compromise yours. My value opinion is not dependent on the subject's contract price or additional market data supplied by the POC, unless that data is more comparable than my appraisal's data. If it is more comparable and I should have known about and analyzed it, the POC's data corrects my errors, it doesn't compromise my independence.

 

[The Matrix]

It was my understanding that the Tidewater Initiative was a compromise deal between the VA and the National Associaition of Realtors. VA was losing market share, particularly in the Tidewater area of Virginia, at or near the apex of the mortgage bubble. The "Curmudegenous old VA appraisers" were killing too many of the realtors deals...so VA's market share was being lost to conventional lenders and appraisers that were more pliable and open minded. At that time, the NAR was pressuring the VA to open the the VA panel to anyone that was licensed (or could fog a mirror), similar to what FHA did earlier when they opened that panel. VA did not want to open their panel, so they reached a political compromise with the NAR to institute the Tidewater Initiative, which was put in place along with a 40% increase in the number of VA appraisers nationwide. Tidewater seems to have solved NAR's problems with low VA appraisals, and secondly it did reduce the number of requests for a reconsideration of value being sent to the VA's regional centers. In my mind, Tidewater breaches the objectivity and impartiality requirements in USPAP. Tidewater creates a bulleye and sanctions the Point of Contact to exert pressure on the VA appraiser, overtly or covertly to hit the contract price. Tidewater simply is bad policy and it should be rescinded.

If Tidewater was put in place to enhance objective appraising...why are all Tidewater requests implemented to increase appraised value?

 

[Mike Garrett RAA]

It was my understanding that the Tidewater Initiative was a compromise deal between the VA and the National Associaition of Realtors. VA was losing market share, particularly in the Tidewater area of Virginia, at or near the apex of the mortgage bubble. The "Curmudegenous old VA appraisers" were killing too many of the realtors deals...so VA's market share was being lost to conventional lenders and appraisers that were more pliable and open minded. At that time, the NAR was pressuring the VA to open the the VA panel to anyone that was licensed (or could fog a mirror), similar to what FHA did earlier when they opened that panel. VA did not want to open their panel, so they reached a political compromise with the NAR to institute the Tidewater Initiative, which was put in place along with a 40% increase in the number of VA appraisers nationwide. Tidewater seems to have solved NAR's problems with low VA appraisals, and secondly it did reduce the number of requests for a reconsideration of value being sent to the VA's regional centers. In my mind, Tidewater breaches the objectivity and impartiality requirements in USPAP. Tidewater creates a bulleye and sanctions the Point of Contact to exert pressure on the VA appraiser, overtly or covertly to hit the contract price. Tidewater simply is bad policy and it should be rescinded.

If Tidewater was put in place to enhance objective appraising...why are all Tidewater requests implemented to increase appraised value?

Believe it or not, I have had agents ask for a reconsideration because they believed my appraised value was too high Of course this was on a short sale

 

[nicholz12]

It was my understanding that the Tidewater Initiative was a compromise deal between the VA and the National Associaition of Realtors. VA was losing market share, particularly in the Tidewater area of Virginia, at or near the apex of the mortgage bubble. The "Curmudegenous old VA appraisers" were killing too many of the realtors deals...so VA's market share was being lost to conventional lenders and appraisers that were more pliable and open minded. At that time, the NAR was pressuring the VA to open the the VA panel to anyone that was licensed (or could fog a mirror), similar to what FHA did earlier when they opened that panel. VA did not want to open their panel, so they reached a political compromise with the NAR to institute the Tidewater Initiative, which was put in place along with a 40% increase in the number of VA appraisers nationwide. Tidewater seems to have solved NAR's problems with low VA appraisals, and secondly it did reduce the number of requests for a reconsideration of value being sent to the VA's regional centers. In my mind, Tidewater breaches the objectivity and impartiality requirements in USPAP. Tidewater creates a bulleye and sanctions the Point of Contact to exert pressure on the VA appraiser, overtly or covertly to hit the contract price. Tidewater simply is bad policy and it should be rescinded.

If Tidewater was put in place to enhance objective appraising...why are all Tidewater requests implemented to increase appraised value?

Yes, indeed, hit the target, covertly, and in some cases blatantly.

 

[nicholz12]

Believe it or not, I have had agents ask for a reconsideration because they believed my appraised value was too high Of course this was on a short sale

I have never been told my value is too high.
That would be interesting to find out how many other VA appraisers had a request for ROV as it's too high.

 

[John "Corky" Harry]

I had a reconsideration request about six months ago. It was a short sale. The Market Value was about twelve percent above the contract price. Both agents went nuts. They provided a couple of additional sales, that with adjustments, supported my opinion. I need to check to see if the sale ever took place.

 

[Fritz in NY]

NAR is a huge organization. Anyone with 1-2 weeks of classroom training and a bucket of money gets in. Test is a joke, and yearly pay dues and bi annuallly take 20? hrs of C.E. (I'm excluded from that thank god)
They have $$$ and we do not because of the numbers/dues base.
I know for a fact as a REALTOR member for more than 25 years and an Cert. Res. App. that we as appraisers have much more education, training (2+ yr mentor), and liability in the game than a Realtor.
I just had the biggest Realtor in my area argue about a low value and supplied me with comps 1.75 & 2.25 miles away, crossing a major interstate and expected me to use them...I had 4 comps with in 4 blocks........Tidewater IMHO is a waste of OUR time to satisfy NAR members. But, hey the VA pays the best here so I'll keep takeing Realtor supplied comps to pacify them....