Trainee information

[TN Pro]

Need some info on trainees. What value, either loan or transaction can a trainee appraise to. I thought a trainee could only appraise up to 250k?
Ive been out of the trainee loop for quite a while, maybe the rules have changed recently.

I have a report in my possession of a home that was appraised by a registered trainee on 12/7/2007 for 360k. The subject was not visited by the supervisor and is marked not inspected on the report.
Also, this particular subdivision comprises generally of 1960's and 1970's ranchers, within the 100-170k range. The subject is a brand spanking new 2 story brick house, similar to what you would find in many West Knoxville markets. As such, the trainee had to leave the immediate market area and go 4 miles for comps. (House is in Pigeon Forge)
In my opinion, this pretty much makes it a complex assignment. There is no discussion in the report if the value of this brand new white elephant in an older subdivision is impacted by its immediate surroundings.

Anyway, any info on the trainee stuff would be gladly appreciated.
(The trainee or appraiser are not names i have seen on this forum)

Dean

 

[Thern Newbell]

I found the sponsor affidavit on TREAC's website and all it stated was the sponsor must accompany the trainee for the first 500 hours, but after 500 hours, the sponsor must be present if the property is more than 50 miles away from the appraiser's location. I think the trainee may appraise a property up to the limitation of their sponsor's licensing.

 

[TN Pro]

Thanks

Thank you Thern.
Did they change the rules?
For some reason i thought a trainee could only go as high as 250k.

Dean

 

[Willie]

Dean, I wouldn't worry about the trainee. Though he's a participant, it's the licensed appraiser who is ultimately responsible.

I don't think this is very complex. Sure it is, if you make it, which I don't think is wise. People don't build "white elephants" in subdivisions which typically run 30% to 50% of the total of this one, typically. And when they do, what are the chances you'll find one that has sold? Not very good.

So I would keep it simple. This home maybe cost $350,000 but is found in a subdivision of 100K - 170 K homes. It is a classic overbuilt home or superadequate home. It is affected by it's surroundings. People in Knoxville buy $350,000 homes regularly, but not in this neighborhood. If you have $350,000 to spend and are in that market, you will not do it in the subject neighborhood.

My best guess is, in terms of value, look at the 170K buyer or home, and ask, just how much will someone give extra for this $350,000 cost home. I'll bet the typical buyer will give more, but the final value will be closer to $170,000 than $350,000. Maybe $230,000 or $250,000 at the most, but that is foe you to decide.. I don't think you are going to find the perfect comp, and I'm sure this is not breaking you any news you don't already know. This is the problem with appraising, and where it really does come down to more of an art. I would be sure to state the quantity and quality of data is poor(if true) and that it comes down to using your opinion, and sound judgement, and say something based on common sense and universally cliche such as "one never wants to have the largest house in the subdivsion", etc.

Good luck. I wouldn't focus on the trainee. You'll have enough problems eslewhere on this one.


Edit

I take it you are doing an REO or review. If not, please discard my message. I may have read too much into it. You may just be going after the trainee and his/her mentor.

 

[TN Pro]

Willie, thanks for your post. You make much sense, and for the record, your guess of 230-250k is right were i am at right now.
No review, and no REO. Its a refi on a house that they bought FSBO from the builder at 360k 5 months ago.
Im not going after the appraiser or the trainee, i just like to have all facts known to me at all times.
I got a gut feeling at the inspection, the borrower was edgy and kept repeating how good the quality of the house was. I believe that they know that they are in trouble, and they are hoping, in my opinion that i do what the original appraiser did and go 4 miles for comps in a subdivision of 300-450k houses. Obviously, that wont happen.
Borrower also kept stating that the builder bought the lot for 100k. Lots in this subdivision would probably be in the 20-30k range, however, no lot sales in a while. The lot is assessed at 35k in the courthouse, but they have a record of a 100k sale in 2006. However it also states that the sale is disqualified, so i need to dig deep on that one.

The mortgage company sent over the appraisal from when the house was purchased, thats when i noticed it was a trainee with no supervisor inspection.
Oh well, back to the research, thanks for the advice.

Dean

 

[TN Pro]

Thern was correct, the trainee can appraise anything the supervisor can.

 

[RSW]

Dean,

I agree with Willie,

I would not worry about the trainee but rather the supervisor. It is his job to make sure the appraisal is done correctly and is not misleading.

I have had several appraisals in Sevier County in the last few years where they had a prior appraisal for 100K more than I appraised it for. I get a lot of flack but I can back up my value with strong data. That's all you can do. What does the market say today? Use the best comps available at the time of your inspection. Let the borrower go after the first appraiser but don't get involved in the fight.

Scott

 

[nikoleavers]

Trainees may appraise what their supervisors are allowed

Dean,

Trainees may appraise properties that thier supervisors are allowed to appraise as they must be under the direct supervision of that appraiser. So, CR's may appraise:
(1) All properties with a transaction value of up to two hundred fifty thousand dollars ($250,000);
(2) All noncomplex residential properties (one (1) to four (4) units).
(3) Agricultural properties, including agricultural properties with up to two (2) dwelling units, with a value* up to, but not including, one million dollars ($1,000,000).

A state certified general appraiser shall have no transaction value limits on such appraiser's appraisal practice.

Competency always applies. A trainee may not appraise a property their supervisor is not competent to appraise and may not go on inspections alone to a property they are not competent to view alone.

If you think the trainee/supervisor exceeded their "complex" limitation or their competency level, you should file a complaint with the Appraiser Commission so that corrective actions can be made. http://www.tennessee.gov/commerce/boards/treac/index.html

Nikole Avers

 

[Willie]

Dean, it's sounds interesting, especially the $100,000 lot in a neighborhood of 20K-30K lots. I am very curious. What site value did the original appraiser put on his/her appraisal? If it's $100,000, I would probably think about calling the appraiser. You mentioned you will need to "did deep" but a phone call may answer. Keep us informed.

Something is very fishy and there could be fraud involved. The original appraisers may be involved, or they may be just caught up in the scheme out of their own ignorance and lack of real estate appraisal experience. If you decide they just messed up, it could be worth a call to them. I would assure them you are not approaching them (especially the trainee) in a threatening manner, but from an educational standpoint. You may have a friend for life. That said, I would only do this if I knew they were not involved in fraud, which might be no safe assumption.

This is an interesting assignment. Again, keep us posted. We are all curious now.

 

[RSW]

Hey willie, your first name would'nt be Slick would it?