Verifying Sales

[hastalavista]

I guess I never understood why you need to call a listing agent for a sales price, when they are the ones that imput the sales price into the MLS. If I called an agent to confirm a sales price, I'd expect them to tell me to read the GD MLS listing, the sales prices is listed right there. If public records confirms it, then you have a good sale.

Doesn't seem terribly complicated.

Chad:

I'd agree with you if all one were to do is to call and verify the sales price.
I will always confirm the sale price. I'll also confirm the physical condition of the property, I'll ask if there were any credits, I'll ask if the buyer was an owner-user or investor, I'll ask if there were any special motivations or considerations, I'll ask if there were any identified repairs or work the buyers intended on taking on immediately upon closing or if there were any issues that affected the negotiated contract price, I'll ask if there were multiple offers, and I'll ask the agent his/her opinion of the current market.
Then, I ask if there is anything else he/she thinks an appraiser should know.

It is amazing what one can learn if one takes the time to speak with the market participants who are actively brokering the transactions within a market (declining, rising, stable, inventory levels, etc.).

Then again, maybe I don't know my markets as well as others, so there is no need for them to confirm what they believe they already know.

:new_smile-l:

 

[mark hurlock]

I never thought of it like that; I guess I should be glad things are as they are. :laugh:

I can tell you that, based on my experience, not many appraisers do call and the agents/brokers I speak with thank me for doing so.
With rare exception, the agents/brokers I call upon are more than willing to provide help and information.

And, I get a number of referrals from them as well. There really is no downside (as I see it) to taking the time and effort to make the calls/send the emails. :new_smile-l:

When I call a realtor, I am very well aware that I am taking their time. I am very well aware if everyone called like I do, they would stop being helpful. I have an appreciation for those that help me when I need it. I do not expect them to do it for every single sale ever considered by every single appraiser.

It sounds great in theory, like if you need repair costs just ask a contractor for free as though these people enjoy donating their time for free.

 

[togatour]

You had better put on a hard hat and duck...I can't wait to see the responses that come as a result of this post.

BTW, I am the Chief Appraiser at a secondary market participant and have been unable to discern any meaningful overall difference in quality between AMC and non-AMC produced appraisals.

So Tim, does that mean that the AMC appraisals, on average, are of good quality in your opinion? Or, are you saying that non-AMC appraisals are of below acceptable quality, just as the AMC appraisals?

I hope you answer is the former. Otherwise, you are part of the problem too. It does not take long to weed out weak appraisers, I have done enough review work to identify weak appraisers, good appraisers, and just plain ignorant appraisers. Some of the weak ones need some more mentoring and education and some are just not competent or ethical enough to survive. As a Chief Appraiser, you are in a prime position to identify quality work. But if all you utilize is AMC panel appraisers, you are missing a large number of quality appraisers who do not work for AMC or low fees.

To make a blanket comment that there is no discernible differences between AMC and non-AMC reports is misleading. I do, however, think there may be a BIG difference between Chief Appraiser's at lender who use AMC panels vs. those who do not. I can not imagine any of my CU or direct lending clients ever accepting or not identifying a sub par report. And they pay north of $400.

Can honestly say that if someone forced you to pay $500 per 1004UAD/MC that you would still use the same AMC panels because a better option was not available?

 

[hastalavista]

When I call a realtor, I am very well aware that I am taking their time. I am very well aware if everyone called like I do, they would stop being helpful. I have an appreciation for those that help me when I need it. I do not expect them to do it for every single sale ever considered by every single appraiser.

Well, for better or worse, based on many of the posts I read in this forum, I don't anticipate much change anytime soon in the number of appraisers who call vs. don't call.

So, I guess you and I, and the others that do call, are in luck.

 

[Lycabull]

You said:

VA appraisers also quote their own fees for VA 1004's

Care to quote your source for that?

http://www.benefits.VA.gov/HOMELOANS/documents/docs/cleveland_fee.pdf

 

[timd354]

So Tim, does that mean that the AMC appraisals, on average, are of good quality in your opinion? Or, are you saying that non-AMC appraisals are of below acceptable quality, just as the AMC appraisals?

I hope you answer is the former. Otherwise, you are part of the problem too. It does not take long to weed out weak appraisers, I have done enough review work to identify weak appraisers, good appraisers, and just plain ignorant appraisers. Some of the weak ones need some more mentoring and education and some are just not competent or ethical enough to survive. As a Chief Appraiser, you are in a prime position to identify quality work. But if all you utilize is AMC panel appraisers, you are missing a large number of quality appraisers who do not work for AMC or low fees.

To make a blanket comment that there is no discernible differences between AMC and non-AMC reports is misleading.
How is that a misleading statement...it is just my opinion based upon my observations over the past 4.5 years in secondary market.
I do, however, think there may be a BIG difference between Chief Appraiser's at lender who use AMC panels vs. those who do not. I can not imagine any of my CU or direct lending clients ever accepting or not identifying a sub par report. And they pay north of $400.

Can honestly say that if someone forced you to pay $500 per 1004UAD/MC that you would still use the same AMC panels because a better option was not available?

I am the chief appraiser at a secondary market mortgage insurer. We do not order appraisals but underwrite the loan package that is provided by the lender (which already includes an appraisal). Some of our lender clients use AMC's, some use internal appraisal panels, and some utilize a mix of panel appraisers and AMC's. Most of the appraisals we receive are of acceptable quality, but we are picky with whom we do business with. Obviously, we decline to insure mortgages where we determine that the appraisal is unacceptable. It is my observation that the overall quality of AMC and non-AMC appraisals are similar (based on my 2.5 years experience as a Chief Appraiser and an additional 2 years experience working at one of the GSE's. Based on my observations, what seems to affect overall appraisal quality most is not whether an AMC is utilized but who the lender is. Frankly, I am surprised that this is the case, since prior to working in the secondary market I had assumed that AMC appraisals were generally of lower overall quality than non-AMC appraisals.

The other chief appraisers and other secondary market participants that I know have also not been able to identify a discernible difference in overall quality between AMC and non-AMC produced appraisals. Additionally, several have also expressed surprise that this is the case.

 

[Marty Boone]

If I determine that more information is needed regarding a sale I call the listing agent. I ask my questions and they provide a response to my questions. I don't call every listing agent for every sale. I have never had any problems getting the information that I need to verify condition or motivation. I was trained to pick up the phone and call. My verification sources are public records, MLS and agent (either by calling them or the information provided on the MLS by the listing agent). I write the information from listing agents on the MLS print out and then it goes in the work file, Done.


"The ability to provide a loan to a worthy borrower rests in the hands of a lazy appraiser and a governmental bureaucrat." If this is really true, where do you fit in? Step up or step out!

 

[Doug Wegener]

Turn times

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.

An agent who responds in 15 minutes is the exception and not the rule. Usually they wiil respond within a day or two if they are going to respond at all to an email. Some will require a phone call and they are not always easy to get hold off. You can spend days trying to get an answer. Some will not return phone calls to an appraiser.

Now when you couple that with the turn times demanded by AMC's, something has to give.Appraisers who do not meet requested turn times are punished in their rating by the AMC.Appraisers who are quicker are given preference by the AMC for future assignments.

In other words, the more time you take to do due diligence, the more they will punish you.

Do you see something wrong with the way AMC operates?

If appraisers were given adequate time, you would see better appraisals

 

[ockyappraiser]

" Originally Posted by NLCApprMgr View Post
We use eight AMCs and the VA Portal. No, I am not going to name them. I inherited them, and have not had enough experience to cast aspersions or drape praise on any of them. I will say this...the level of competency expressed in the reports I have reviewed only vary minutely between the AMC and VA appraisers. VA appraisers have ten business days to complete the appraisal, and based on my reviews and comparison, giving the AMC appraiser more time does not relate to a better quality appraisal. VA appraisers also quote their own fees for VA 1004's; so throwing more money into the process also provides no greater bang for the buck.
You had better put on a hard hat and duck...I can't wait to see the responses that come as a result of this post.

BTW, I am the Chief Appraiser at a secondary market participant and have been unable to discern any meaningful overall difference in quality between AMC and non-AMC produced appraisals."

I find it interesting that no one is countering these statements. The only party that can confirm that "more time" equals "better appraisal" is the end users, two of which posted above.

A lot of claims go slinging around on these forums that those that turn in 48 hours from inspection are sub par appraisers. I have done many reviews done by some of the "old boys" in our area that take two weeks on an appraisal assignement and found them very "thin" on support and analysis.

One other thought. Realtors are by mandate advocates. I find it amazing that the same appraisers that complain that realtors lie, exagerate and push appraisers for values when the appraiser is doing the purchase inspection. . .believe every word that the realtors tell them when they call them on the comps.

Let's say for the sake of argument that two appraisers were defending a report on the same subject. Both had the public record info. One called the agents and noted their "verbal" comments. The other reviewed interior photos of the comps and the seller's disclosures in addition to the public data. When it came to defending their reports. . .which would have the better case? The one with the copies of the seller's disclosures in their workfiles and could produce interior pics from MLS? Or the one that "verbally" confirmed details with the realtor but had no actual proof of those statements?


__________________

 

[Terrel L. Shields]

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.

I guess some of us here do not like being called a nobody.

I just finished a triplex where 1 unit was remodeled, 1 was in fair shape but needed all new paint, and one unit was indescribably bad. I figure maybe $30,000 work. It is one of many sales in that subdivision, which the entire mess was repo'd. The pricing is all over the map.

Even relying upon the MLS isn't much help. A couple of the duplexes in the project were if pretty decent shape. A couple were in horrible shape.

These are very individual issues. I will refrain from asking about who hires your appraisers or what you pay, but you see that quality has long since gone out the window in favor of quantity.

But I would like to ask. You are going to get a "reconsideration" of the appraisal and provide the appraiser with the additional information. Hopefully, they have enough sense to revise the report. If they don't I hope you have enough gumption to turn the report into the state.

Now what happens? Will that appraiser be blacklisted by your bank? Or will they continue to use them without a word? Will they pull them in and sit them down and say, "How can we fix this? Is the turn time and fee so low that you are unable to complete the report? Do you realize we expect you to know what is in and out of the comps?"

Even Pavlov's dog recognized the connection between the bell and food only when the food was actually there.

Keep posting. I certainly don't want you to take any of this personal. But the lender and the appraisers certainly need to get on the same page and this is a learning opportunity for both of us.

If every appraiser called every listing agent for every sale they considered for every assignment, how many realtors would continue to take calls from appraisers?

Text them on their cell...it's like catnip. They can't resist replying.

When you have a "low" comp, that's the time you really need to know. I will eschew a close sale if I don't have the "right" data and a price to match.

One thing I love about Realtors. When they list a small farm with a manf. home, about half of 'em will have 16 pictures in the MLS...Nary a one of the MH interior and likely the #1 pix is a barn or pasture scene. Talk about flagging the MH as "bad"...you just did it.