Unintended consequence of reviews

[John Hassler]

You're still issuing fault where there is none to issue, although that may be because you lack the ability to understand it right. An appraiser either has integrity or he/she doesn't - and the fees/expectations of the clients should not alter that obligation. The system was broken WAY before your 'F/F pipeline have gravitated to the lowest-cost least-competent' appraisers. The reason we have turd appraisers training new turd appraisers is because their trainers were turds and their trainers were turds. Now, the F/F standards may contribute to the length of tenure of turd appraisers, but I know lots of appraisers who do F/F work - who are very conscientious about their work. I also know GC's who don't work for F/F who are completely lost in the sauce.

Your logic doesn't hold.

Now we’re getting some where. F/F-type lenders have added to the “length of tenure” of the donkeys to the detriment of the competent. Sure, there are appraisers out there with strong sense of integrity and ethics but they are getting squeezed out financially by those without less, sometimes much less, because that’s who the market is seeking out and hiring.

I would say this has been going on for at least 20 years and now look where we are. If you were trained in a fee shop prior to 2005 you are probably a pretty good appraiser. Afterwards, not so much unless your own integrity led you to learn better. Just an observation after 40 years.

 

[DWiley]

I would say this has been going on for at least 20 years and now look where we are. If you were trained in a fee shop prior to 2005 you are probably a pretty good appraiser. Afterwards, not so much unless your own integrity led you to learn better. Just an observation after 40 years.

Based on my personal experience, I would say that what you described has been going on much longer than that. It has been going on ever since I started in the early 80s.

I was trained in a small firm led by a person who had been trained at an S&L. He had multiple designations and certainly knew how to do things correctly. Yet, he did not train the staff appraisers on analysis - I only learned that after I took my courses. Then I had a decision to make.

 

[Dale Floyd]

I was trained by a brilliant mind in finance, who understood banking, management, and was a member of AI. He was the bank's owner, chair, and appraiser back in the day.

Nobody better than Mr. D. in understanding money, and he understood the process - but his appraisal methods involved his mood of the day or the quality of the borrower. I began my real education through books, classes, and finding others who understood the profession more clearly that were willing to mentor me a little bit. And then FIRREA happened. lol

 

[Dale Floyd]

It would be helpful if reviewers were trained as appraisers, in my view. I've reviewed tons in my career, and understanding the perspective of the process was always vital for me.

 

[alebrewer]

If you were trained in a fee shop prior to 2005 you are probably a pretty good appraiser.

This is pure speculation to support your untenable argument, so no - we're not getting somewhere now. Continue to cast dispersion on the mean ole lenders and F/F. Those directly to blame for their poor performance, however, are the appraisers - both the trainers and the ones being trained. It's little more than a cop out to blame lenders for the poor performance of our constituents.

I'd offer an opposite - yet equally speculative argument about those trained prior to 2005: they were trained even more poorly than those after. My dad was appraising in the '70's and '80's - prior to computers (at least as we know them), analysis software, etc. He - and all his appraiser pals - couldn't run a regression if someone was doing it for them. Technology (and the subsequent analysis tools available to appraisers) has advanced WAY faster than most of the old timers could keep up with - yet that's who was training the next batch of appraisers.

Just because you've held a credential for 3 years does NOT make you qualified to train a future appraiser. Has nothing to do with the lenders.

 

[DWiley]

One can argue about the percentage of appraisers who do not know how to properly develop an appraisal, but one thing is clear from a myriad of posts in this very forum - that number is not zero. As simple evidence, I would point to posts asking for guidance on how to support the GLA adjustment that they have been using for years, but are now being questioned about by a reviewer or underwriter. They simply do not know how to respond to what, on its surface, is a very simple question - how did you derive the GLA adjustment rate? Even if they used the "list" method, they should have enough technical knowledge to provide a response that sounds legit.

How does one obtain a state-issued credential as a real estate appraiser and not know something so fundamental? What is broken in the system today that allows that to happen, and how can it be fixed?

 

[John Hassler]

Based on my personal experience, I would say that what you described has been going on much longer than that. It has been going on ever since I started in the early 80s.

I was trained in a small firm led by a person who had been trained at an S&L. He had multiple designations and certainly knew how to do things correctly. Yet, he did not train the staff appraisers on analysis - I only learned that after I took my courses. Then I had a decision to make.

There are always exceptions. .

I also started in the 1980s (1984) and it was a far different world. Sample appraisals were required to get on “the approved panel” before you completed a single report for a lender, and I had packets with three samples plus resume ready to overnight on a moments notice. It was a big deal to get on a lender panel and your would include them on your resume. When speaking with a User, they were actually conversant in appraisal.

Contrast that with today when the requirement is to have a license, insurance, and the conversation is ‘how cheap can you do it?’ And who would brag on their resume about all the AMC panels they are on?

No, it’s a different world now with far less demand for competency.

 

[Terrel L. Shields]

who do not know how to properly develop an appraisal

It does not help that CE which used to stand for CONTINUING EDUCATION seems more now to stand for COMPLIANCE ESTABLISHMENT focusing not upon teaching or reinforcing the methods and techniques of the business rather focused upon form and procedure.

With every state now apparently on board with "diversity training" and "ethics" as if A- we don't know that it is against the law to discriminate, and B - we have no financial incentive to discriminate, and C - few of us have any (im)moral reason to do so... when do we get back to having CE stand for EDUCATION and not some social score of our morals?

Yes, it seems remarkable that some appraisers absolutely do not know how to even do a paired sale, let alone sensitivity or even single linear regression. Excel has been around a long time. And the quick and easy routines of that program can do any of the tasks we use mathematically. And it's amazing to me the number of appraisers who do not even have a cost book let along know how to use it.

 

[alebrewer]

And it's amazing to me the number of appraisers who do not even have a cost book let along know how to use it.

I was with ya till this statement... But then again - I'm sure you'd expect that from me.

 

[TerryRohrer]

I was with ya till this statement... But then again - I'm sure you'd expect that from me.

Well, he did list it in its order of importance!