Verifying Sales

[NLCApprMgr]

In my last thread, I got an earful from appraisers about how money makes the mare go, that I get what I pay for, etc. One of my biggest issues is that appraisers rely on MLS and public record for their verification process. Nobody contacts a broker, a buyer, or a seller to get any further understanding about the sale that wasn't in the MLS. There may be issues surrounding a sale that are not in the MLS that influence the sale price and require attention in the sales grid.

As an example, I am reviewing an appraisal on a duplex. The appraiser provides three sales ($215k, $270k, $280k). My first reaction is why the one sale is so low compared to the others. The appraiser explains that these are basically the only three sales in the market in the past year. I do my research, and I agree with the appraiser; these are the most appropriate sales. Still, was there something else about the one sale that made it so much lower?

I found out who the listing broker was and sent an email. He responded in an hour of my email, and we talked about the sale for 15 minutes. I found out that the property required a complete interior overhaul that probably cost $35k to $40k. This information would not be contained in either the MLS or the public record. And you can guess that the appraiser made no adjustment for condition.

So, I now have to present this to the convening authority for review, who then has to present it to the appraiser, who then gets to consider our request and accept or deny our research. The ability to provide a loan to a worthy borrower rests in the hands of a lazy appraiser and a governmental bureaucrat.

 

[Joe Flacco]

Many appraisers do contact a broker, a buyer, or a seller to get further understanding about sales.

 

[Elliott]

NLCApprMgr said, Nobody contacts a broker, a buyer, or a seller to get any further understanding about the sale that wasn't in the MLS.

Just curious, what kind of appraiser did the lender or AMC hire? How much did they pay for the appraisal to the appraiser? I would guess an appraiser without much experience was retained and paid the lowest price they could worm out of the market. They didn't hire an experienced, ethical appraiser.

Its not accurate to say "nobody" verifies sales, good appraisers verify sales. Your not hiring good appraisers.

 

[Lee Lansford]

In my last thread, I got an earful from appraisers about how money makes the mare go, that I get what I pay for, etc. One of my biggest issues is that appraisers rely on MLS and public record for their verification process. Nobody contacts a broker, a buyer, or a seller to get any further understanding about the sale that wasn't in the MLS. There may be issues surrounding a sale that are not in the MLS that influence the sale price and require attention in the sales grid.

As an example, I am reviewing an appraisal on a duplex. The appraiser provides three sales ($215k, $270k, $280k). My first reaction is why the one sale is so low compared to the others. The appraiser explains that these are basically the only three sales in the market in the past year. I do my research, and I agree with the appraiser; these are the most appropriate sales. Still, was there something else about the one sale that made it so much lower?

I found out who the listing broker was and sent an email. He responded in an hour of my email, and we talked about the sale for 15 minutes. I found out that the property required a complete interior overhaul that probably cost $35k to $40k. This information would not be contained in either the MLS or the public record. And you can guess that the appraiser made no adjustment for condition.

So, I now have to present this to the convening authority for review, who then has to present it to the appraiser, who then gets to consider our request and accept or deny our research. The ability to provide a loan to a worthy borrower rests in the hands of a lazy appraiser and a governmental bureaucrat.

From the folks (men and women who are appraisers and who have had, or have, positions that give them a good perspective as to quality of appraisals for use in residential lending) whose experiences and opinions I trust (and, coincidentally, mirror my own experiences), what you cite is much more common than not.

 

[Joe Flacco]

From the folks (men and women who are appraisers and who have had, or have, positions that give them a good perspective as to quality of appraisals for use in residential lending) whose experiences and opinions I trust (and, coincidentally, mirror my own experiences), what you cite is much more common than not.

I don't think anyone argues that what the OP describes is common. It's his use of the word NOBODY.

 

[Michigan CG]

There are many appraisers who were never trained to verify a sale. There are many appraisers who have never been exposed to the correct way of doing things including verifying a sale. There are many appraisers who would call what you are describing as Scope Creep.

There are many appraisers who do not understand the "credible" as described in USPAP.

You have already "met" some of those people on this site, you are bound to "meet" more.

About half the people on here are going to very much enjoy your presence on this forum, the rest not so much.

 

[JTip]

Range of $215k-$280k.

You wanna memoir on the sales used for a three digit bank fee?

I see those partictular verification 'details' disclosed on an appraisal once the fee hits four digits.......

Keep on slingin' the $1 McDoubles but don't ask for bacon, it will cost you.

 

[NLCApprMgr]

Clarification

I apologize if I used the term "Nobody". I will say this. I have not seen one appraisal where the verification included any of the following terms: "Buyer", "Seller", "Listing Agent", "Selling Agent", or "Outside Broker".

With regard to our hiring process for appraisers, our company has no control over appraiser selection. We utilize national AMCs and the VA Portal; they select the appraiser. Damned AIR forces this issue.

 

[NEINAPPR]

I asked you in the previous thread what AMC your company utilizes and you failed to respond. Is there a reason you don't want anyone to know? The AMC may have nothing to do with the facts or it may have everything to do with them. You really can't complain if you utilize the services of some AMC that broadcasts orders to the person who will get the report done the fastest for the lowest amount of money. Lenders are the ones that are ultimately responsible for the appraiser selection if they use an AMC or if they don't. When I got a roof put on my house I read reviews and I didn't go with the lowest cost (or even the second or third lowest). When I had some trees cut down this fall I did the same, I paid almost double the price of my lowest quote. People can claim what a person is paid should have no affect on quality and all I can say is hogwash! Nothing in the real world works that way, you pay cut rate fees you can darn well expect a cut in quality somewhere, and this holds true if it is fast food compared to fine dining or the selection of an Attorney. If you ever NEED an attorney are you going to get the cheapest one you can find and expect them to be as good as the high paid ones? Again I ask you what AMC does your company use?

 

[mark hurlock]

In my last thread, I got an earful from appraisers about how money makes the mare go, that I get what I pay for, etc. One of my biggest issues is that appraisers rely on MLS and public record for their verification process. Nobody contacts a broker, a buyer, or a seller to get any further understanding about the sale that wasn't in the MLS. There may be issues surrounding a sale that are not in the MLS that influence the sale price and require attention in the sales grid.

As an example, I am reviewing an appraisal on a duplex. The appraiser provides three sales ($215k, $270k, $280k). My first reaction is why the one sale is so low compared to the others. The appraiser explains that these are basically the only three sales in the market in the past year. I do my research, and I agree with the appraiser; these are the most appropriate sales. Still, was there something else about the one sale that made it so much lower?

I found out who the listing broker was and sent an email. He responded in an hour of my email, and we talked about the sale for 15 minutes. I found out that the property required a complete interior overhaul that probably cost $35k to $40k. This information would not be contained in either the MLS or the public record. And you can guess that the appraiser made no adjustment for condition.

So, I now have to present this to the convening authority for review, who then has to present it to the appraiser, who then gets to consider our request and accept or deny our research. The ability to provide a loan to a worthy borrower rests in the hands of a lazy appraiser and a governmental bureaucrat.

I have a question.

Do you think if you paid a reasonable fee for the work expected and allowed the appraiser to determine their schedule for completion rather than dictate the fee and turn time as a condition of earning a living that you would be here complaining about quality?