"First, in regards to different individuals interpreting appraisal standards differently. I would again point out that the state boards effectively determine what kind of conduct is and is not allowed in their states by the manner in which their laws are written and enforced."
George if that was true, why do you think there's so much disagreement with the rulings made by the State Boards in N.C. and Illinois, as stated on this Forum?
"It is not up to a reviewer to determine if an appraiser should face discipline from a state board, so a reviewer is not responsible if and when that happens. The state boards make those decisions. The only thing the reviewer is doing in such a case is presenting an allegation. A reviewer had best not be making allegations if their own performance in the case is not in compliance."
The person who files the complaint or makes the allegation is directly responsible for any discipline received by the Appraiser. If he/she hadn't filed a complaint there wouldn't be any action. Back in the "Old" days I think the Lender would request a Review, but with the Appraiser's name redacted. If Lenders expected to continue using Residentials Appraisers in the future they would probably go back to that system. Otherwise the Lender would end up having their Appraisal Roster depleted.
"Secondly, as to your suggestion that others are responsible for this mess: Neither I nor anyone else in this thread has suggested that the issues of lender pressure, lender greed, lender indifference to appraisal malpractice, and a whole host of problems relating to employment of appraisers by lenders do not exist. Those issues do exist, and to be sure, they are all very real problems."
George, if what you say is true, why don't the Appraisers and the Appraisal Organizations work to eliminate that problem, because if they could, all other problems would be eliminated. All Appraisal Problem are centered around the Lenders minipulation of the Appraiser for their own benefit. The Lender has the best of both worlds. They can direct the Appraiser to meet their inflated Values, if they don't they wont use him/her. If there is a problem with inflated values, it's the Appraisers fault. The Lender is in "Hog Heaven", how can he lose.
"The thing is that we don't have any control over the manner in which our clients act. USPAP and the current system of appraiser licensing were never intended to address those issues. We do not regulate lender activity the feds do that, or at least they are supposed to do that."
That's true George, it's the Appraiser that's being minipulated by everyone, and they are also controlled by the Lenders, and that's why the Lenders have not been removed from the appraisal process. There is no doubt about it, the Lender has a conflict of interest since the lender is technically controlling the value of the property while making the loan on the same property.
"The thing that really troubles me is the avoidance of responsibility. We have no right to point the finger of blame solely at the lending community when our own house is not in order."
There is a big difference between what the Lender does and what the Appraiser does. The Lender controls the Appraiser, but the reverse is not true. The Appraiser functions at the descression or the will of the Lender. The Lender has to choose an appraiser, the appraiser don't choose a lender and "require" the lender to use him/her as an appraiser.
"Look at the unfolding scandals within the accounting profession. Yes, the clients are guilty of doing bad things, but the accountants who sign off are just as guilty. It is likely that the accounting profession will continue to suffer for their collective sins long after the guilty CEOs and CFOs have retired to their villas by the sea."
What's being exposed in the Accounting Industry is widespread, the Fed's will eventually select some low level executive, slap him on the wrist, and the basic problem will continue to go on. This stuff just didn't pop up with Enron and World Com. If the government had the manpower to audit all major corporations handled by these "Big 5" (or is it Big 4 now, in my day it use to be "Big 8") Accounting Firms, they would find that they are all doing the same thing, minipulating losses, and creating dummy partnerships in the Cayman's.
"The handwriting is on the wall. The government and the market will not tolerate malpractice by valuation professionals indefinitely. If we wait for them to react, then we have no control over how it plays out and what measures are used to ensure it doesn't happen again. On the other hand, if we can demonstrate that we are serious about making our system work in whatever form it ends up taking, then we will be given more lattitude in setting our own standards."
George you keep forgeting that the Appraiser has no control of his destiny, the lender has that control. If the Lender wants to eliminate you as a Residential Appraiser he can stop using you and give you a negative referral when future clients contact him. The Lender can also decide to use BPO's, and AVM's in place of the assignments you were getting. So why would you be concerned about cleaning up the appraisal profession to do appraisal work that is being eliminated? You don't seem to realize that the fraud you seem to be talking about has very little to do with anything, since it only affects the appraisal profession to the extent that the Lenders wont to use the publicity to quickly convert their system to "Short Form Value Estimate Reports" that don't require an appraiser. In otherwords the lender's purpose is to eliminate the Appraiser. So they are trying to use the Fraud scare that they are in control of to make it appear that a large number of Appraiser have a reason to falsefy a $ 300 Appraisal Report, but the only Fraud Scheme is being directed by the Lender in the form of inflating the value of the properties they are making loans on. All recent changes at FNMA and Freddie indicates that the lending industry purpose is to eliminate the appraiser so the lender can set the value at what ever figure he wants. Some Appraisers seem to relish in USPAP, but USPAP in the near future will only affect a small number of Appraisal Reports, those done by Licensed Appraisers, while the majority of Reports will go the AVM and BPO route which excapes USPAP.
"It's the difference between acting and reacting. If we are proactive, we can maintain more control over the situation; if we merely wait for bad things to happen and then react, we lose that control. Which would you rather have?"
As I indicated above, since the Appraisal Profession (as we know it) is being eliminated, what you are being proactive about is not even an issue when it comes to the viability of the Residential Appraiser over the long term. Why do you think that all these changes that are negative to the Appraisal Business have made steady progress over the past several with not one hitch or roadblock. You havde had the introduction of shorter and shorter Forms for smaller and smaller fees continually. Do you think it related to "Appraiser's Proactivity"? If that is so, I'd have to say that the Appraiser and the Appraisal Organizations have been working against themselves. The Record speaks for itself. The Reason these changes have been taking place is because of "Appraiser'sl Inactivity".
leon
