Unintended consequence of reviews

[sputnam]

The question in my mind is, who did the review? Are they competent?

Was always under the impression, a reviewer would take the time to reach out to the appraiser, review the findings and come to a reasonable solution. Of course some, many almost all feel their work is the best on the planet, but the approach to the review, use to be for the benefit of all. Somehow, the GSE's decided they would put that work in the hands of the Liar Loan people, which benefits no one

Yep... it matters who does the review. Unfortunately, it doesn't always work out that way. Back in the day, one of the appraisers who worked in my shop told me that his very first job as an newly licensed appraiser was doing reviews for a bank.

 

[Surf Cat]

Almost every revision request in my practice involves a Standard 2 violation.

What are the top three violations?

 

[sputnam]

If the intent of ALL reviews was to increase quality, all clients engaging reviewers would be willing to pay a reasonable fee for reviews and a subsequent appraisal if that were part of the SOW. In my experience, more are looking for a rubber stamp at a minimum cost.

Agreed, but as noted above, most lenders are loath to hamper delivery of appraisals that facilitate the deal, regardless of the facts.

Never mind..... I misread your post. I agree. AMCs even more than Lenders but, they do always seem to be in a hurry.

 

[sputnam]

What are the top three violations?

Off the top of my head... the ones I see most involve not providing comments summarizing the support and rationale for HABU... not stating that assignment results might be affected when HCs and EAs have been used.... and, land appraisals.... no sales history or maybe... not commenting on a sales contract because it's new construction. There are plenty of others... but I think those are most common. Occasionally, I even see an appraiser who invokes the Departure Provision. Come on.... Update your templates.

 

[timd354]

You misunderstood my point, most times the lender (loan officer) does think the higher value is more credible. Maybe because the borrower does too.
I did not say they always use it.
Most of the time a second appraisal is obtained by a regulated lender because of a value concern. Very few times will a lender order a second appraisal because of an USPAP concern. They barely even know what the USPAP is.

I never worry about what sales people think or do. The only thing that matters is what the underwriteres and QA people do.

 

[Dale Floyd]

Let’s get real. There are many reviewers who are horrible, and shouldn’t be the ones trusted to turn anybody in.

 

[TerryRohrer]

That's a unsupported assumption and conclusion. For Lenders and AMCs... the name of the game is $. Always has been. The minimum standard is USPAP. All too many appraisers never do anything to advance the quality of their work. They may be 10 years into the business... and they still do appraisals like they did when they were noobs.

That is an unsupported assumption and conclusion.

 

[Sandra Koutsopoulos]

I did a bunch of reviews for FNMA & Freddie during and after the Ginormous Foreclosure Periods, and mostly the jobs were actually forensic. They knew or suspected fraud, and wanted someone to point it out and prove it. I assume they moved forward with many of those cases, because some were off-the-wall outrageous outright FRAUD. Straw buyers, houses that didn't exist, recording doc numbers that were total fantasy, sold prices that had no basis in reality, disappearing freeways. I always found it interesting to pull the threads to see how the perpetrators were thinking. A disturbing common thread I often found was that the Buyer/Seller/Borrower was the brains and recipient of the fraud, and some appraiser for 'peanuts' (I assume) put his signature an those fraudulent reports. Duh. Stupid.

In my previous life, I did forensic accounting work, and it is really interesting to see how ppl think they're going to get away with their financial manipulations.

 

[djd09]

why weren't some of the bias cases turned into the state...why do those go to civil court...how many staff appraisers vs independent appraiser receive letters..it is like a secret society filled with conspiracies and innuendos...but at least we know due dates are not an USPAP infraction

 

[Bob Ipock]

Appraisal reviews are intended to increase quality in the industry. They are intended to catch questionable reports before they are used to support lending decisions. Typically, when an AMC or Lender review spots and issue, revisions are requested. That's all good.

The down side is that AMC and Lenders rarely report bad appraisers to the state appraisal board. The reasons are understandable. They just want to close the loan. It's a big pain in the, um, paperwork to file a complaint. It takes a lot of time and effort.

However, if bad appraisers were routinely reported to their appraisal board.... maybe there would be fewer bad appraisers. Allowing appraisers to fix a report until it passes... with no other consequences.. just rewards and perpetuates bad appraising.

However, if bad appraisers were routinely reported to their appraisal board.... maybe there would be fewer bad appraisers. Allowing appraisers to fix a report until it passes... with no other consequences.. just rewards and perpetuates bad appraising.

The problem is "anonymous complaints". Some dishonest board members got a state lawmaker to get a bill passed that all complaints had to be signed. This is ridiculous and perhaps illegal. I can file an anonymous complaint with every law enforcement agency. City police, county police, FBI, SBI...you name it. Oh, bit not a complaint to the appraisal board. This very same lawmaker was sent to prison for fraud (not related to NCAB).

People are not willing to sign their name to a complaint. I have probably sent on 10+ complaints over the years and signed everyone of them. The complaint is either valid or not. Regardless if a complaint is signed or not....if an appraisal is sent in to the state board....the investigators will figure it out. I have had 5 complaints filed against me since 1991 and every single one was dismissed. No evidence of wrong doing.