What if.

[Lawrence R.]

What if appraisers were held responsible for the loan performance on the houses they appraised?

I mean, how about some sort of tracking tied to our license number?

For sure, you could have a foreclosure ratio...maybe a delinquency ratio, and also a sale to appraisal ratio for foreclosed properties.

Caveats:

I know that appraisers who do low volumes would possibly be affected more harshly.

I know that foreclosures can sell below a good appraised value just b/c it is a foreclosure...

But, as these numbers shook out, a benchmark could possibly be established based on volume, total dollars appraised, etc?

Any thoughts?

 

[JRS at OBX]

Ok, so what if my main clients were subprime lenders. I would have a much higher foreclosure ratio than the appraiser that just does divorce work. Loan performance doesn't always have anything to do with the appraised value.

I know of one house I appraised that was foreclosed on, the owner was shot and killed. His wife couldn't afford the payments. Should that be a negative mark on my record? I didn't shoot anybody.

 

[Lawrence R.]

Hard to reply with head bitten off...


LOL


Ummm. I suppose this would really only tie to appraisals for a loan. Divorce work wouldn't be in that arena usually.

and yes, it would quickly become apparent that every appraiser(doing a reasonable amount of work) would have some amount of foreclosure tied to his appraisals.

as I said, as time went on, we may find that it is perfectly normal for even the best appraiser to have (who knows) 3 to 5 percent of the loans he appraises go bad.

that is why we could have other statistics to compare as well, such as the resale to appraised ratios...

Again, if you only do 3 appraisals a year, it may be very different...but I think that possibly number that could be used for comparison might emerge....

and before anybody thinks that I am personally advocating this--I am not.

This is simply a hypothetical. A post on another thread piqued my curiosity about this.

 

[Mr Rex]

If they send me their credit and employment history and let me decide if they qualify and I want to do the assignment based on the borrowers qualifications, I wouldn't have any problem with it. Oh yeah, I'll need the MB's 3% for qualifying them.

 

[Tom Woolford]

I don't think I want my performance judged due to folks who have lost jobs, got divorced, or a loan officer who falsified docs. Now if you want it base on unsatisfactory reviews by qualified people operating under USPAP, fine. I have not had to defend a review in almost 10 years.

 

[JRS at OBX]

Hard to reply with head bitten off...

I didn't bite, just chewed a little... lol

:icon_mrgreen:

 

[Scott Lanz]

Sure, I have a thought.

You can start this by offering to be personally responsible for all the work you do via your contract. Let me know how it works out for you.

 

[liberated]

I believe that other considerations should be taken into account for this thought process. I live in an area with among the highest bankruptcy, foreclosure and fraud ratio in the country; moreover, the majority of mortgage loans over the past 10 years have been subprime loans. With these factors in mind, one must consider that appraisers in metropolitan areas with similar demographics would suffer a higher foreclosure ratio due to the increase in bankruptcy, foreclosure and fraud; therefore, I do not believe that what is proposed in this thread could be completely accurate.

 

[c w d]

What if appraisers were held responsible for the loan performance on the houses they appraised?

I mean, how about some sort of tracking tied to our license number?

For sure, you could have a foreclosure ratio...maybe a delinquency ratio, and also a sale to appraisal ratio for foreclosed properties.

Caveats:

I know that appraisers who do low volumes would possibly be affected more harshly.

I know that foreclosures can sell below a good appraised value just b/c it is a foreclosure...

But, as these numbers shook out, a benchmark could possibly be established based on volume, total dollars appraised, etc?

Any thoughts?

How would this prevent bad appraisals? All it would do is make the appraiser responsible for an irresponsible lender as the appraiser could be spot on but the lender could lend the money to someone not closely qualified for such a loan.

 

[JRS at OBX]

NC tried to pass a bill that would include the appraisers name on the deed of trust. It's similar to what you are talking about.

Here is a discussion about that bill.

http://appraisersforum.com/showthread.php?t=134061