We need to clean up FNMA and Freddy

[George Hatch]

appraisers have no concept of time value and money...

Again, what any individual is willing or able to do isn't the basis for the reasoning behind the rules which are established which apply to the group. They're going to operate on the known performance of the group, not any smaller subset within that group.

 

[djd09]

i just went to a cavs game (13-0)...bought a beer and a dog...they ask for payment well of course duh

 

[Surf Cat]

When this happened, it was like a gift. But you do see the reason this is not the status quo any longer right?

Well.... this process was in place way before I came onto the scene. It was all laid out during the call to the borrower to set up the inspection.

Ma'am, my record shows your property has three bedrooms, with one and a half baths and is 1632 square feet, is that correct? In the last 3 to 5 years, have you done any improvements or upgrades? Great. For my services I need to collect the check for $350, I'll see you at 10:00 a.m. tomorrow.
Boom, done. No gun to the head for their money. They knew what they were getting. Any objections and they were sent back to the mortgage broker to speak to them about the terms of payment.

Regarding the concerns about potential biases and conflicts of interest which you're eluding to. The appraiser being paid 40 to 60% less, having to produce a USPAP compliant report in 24 hours, being shoved ROV's, and being paid 30 days later, sure solved that didn't it?

Mortgage brokers are more out of control now with indirect access to Collateral Underwriter and waiver forms in front of them.....

 

[George Hatch]

I keep saying it because it's true: if the current setup has reduced the number of dishonest appraisals by even 10% then that economically and morally justifies 100% of the collateral damage to appraiser fees and working conditions. Appraisers don't matter to anyone other than appraisers. If we did then the govt would protect those interests.

Cruel and "not empathetic" to people's feelings, but true nonetheless.

 

[djd09]

Mortgage brokers are more out of control now with indirect access to Collateral Underwriter and waiver forms in front of them.....

 

[TerryRohrer]

Well.... this process was in place way before I came onto the scene. It was all laid out during the call to the borrower to set up the inspection.

Ma'am, my record shows your property has three bedrooms, with one and a half baths and is 1632 square feet, is that correct? In the last 3 to 5 years, have you done any improvements or upgrades? Great. For my services I need to collect the check for $350, I'll see you at 10:00 a.m. tomorrow.
Boom, done. No gun to the head for their money. They knew what they were getting. Any objections and they were sent back to the mortgage broker to speak to them about the terms of payment.

Regarding the concerns about potential biases and conflicts of interest which you're eluding to. The appraiser being paid 40 to 60% less, having to produce a USPAP compliant report in 24 hours, being shoved ROV's, and being paid 30 days later, sure solved that didn't it?

Mortgage brokers are more out of control now with indirect access to Collateral Underwriter and waiver forms in front of them.....

It is an urban myth that mortgage brokers have been removed from the process. Until very recently, Wells Fargo had them housed within local brokerage offices so they could interfere when an honest appraiser was assigned to their joint deals. Now, AMCs, lender owned and "independent" send out notices immediately after an assignment is accepted by an appraiser. If the appraiser is unacceptable to any of the parties, the AMC is notified and the assignment is canceled. Just a few more steps than 30 years ago, but essentially the same system.

 

[alebrewer]

Well.... this process was in place way before I came onto the scene. It was all laid out during the call to the borrower to set up the inspection.

Ma'am, my record shows your property has three bedrooms, with one and a half baths and is 1632 square feet, is that correct? In the last 3 to 5 years, have you done any improvements or upgrades? Great. For my services I need to collect the check for $350, I'll see you at 10:00 a.m. tomorrow.
Boom, done. No gun to the head for their money. They knew what they were getting. Any objections and they were sent back to the mortgage broker to speak to them about the terms of payment.

Regarding the concerns about potential biases and conflicts of interest which you're eluding to. The appraiser being paid 40 to 60% less, having to produce a USPAP compliant report in 24 hours, being shoved ROV's, and being paid 30 days later, sure solved that didn't it?

Mortgage brokers are more out of control now with indirect access to Collateral Underwriter and waiver forms in front of them.....

There just simply is no way to talk one's self out of an accusation that the borrower is - at the very least - an intended user when he/she is paying the appraiser directly for the service. Back in the day it was VERY common for the MB's to advise their clients to offer additional incentives to elicit more favorable valuations. I've had homeowners offer more money, offer things of value, sexual favors - you name it. I'm telling you - as corrupt as it is today, it's nothing compared to PTDF (prior to Dodd-Frank).

 

[George Hatch]

So file the complaint, because now there's a paper trail for the regulators to follow; whereas before there basically wasn't. That's what happens when more of the volume gets aggregated into many fewer conduits - any patterns therein become easy to identify, right down to the individual memos or emails. That's exactly how eAppraiseIT and WaMu got caught - the paper trail stood out as soon as anyone started looking. That's also why Fannie/Freddie capitulated so quickly in the face of a threatened audit of their portfolio.

We'll soon be able to prove how corrupt the AMCs have or haven't been performing WRT prompting for dishonest appraisals. Because back when I was doing reviews for the wholesale lines I was *routinely* running into overvaluations to the tune of $50k or $100k. Every week, and I was only reviewing 15-20 hours a week. So by all means, lets revisit this allegation when the dishonest AMC appraisals are proven to be as common as that.

Hypothetical question: if it comes to pass that the AMC appraisals are proven to include a lower percentage of dishonest borrower-biased outcomes, what are you guys going to do then? Because at that point all discussion about MB pressure being just as bad now as ever becomes a lot harder to argue. OTOH, if the MB pressure level is proven to be more/less the same then that will justify cutting the AMCs off on the same basis the MBs were cut off and the lenders will have to do direct engagement only. Or AVMs.

 

[djd09]

it is kool aid pouring time...

 

[George Hatch]

The feds imposed the same limitations on the CG side back in 1990, and for exactly the same reasons. It's not a silver bullet by any means, but better is always still superior to worse.

Just think, had the feds acted consistently and done the same thing to the SFR side back in 1990 then most of you would never have come up in an MB-centric market for appraisal services to begin with. Your client relationships would have only been with the lender whose money it was going out the door. Or their agent (aka AMC).

Think that one through.