What if.

[Couch Potato]

It would be great! I could go into the lending business and never worry about a default.

 

[Lawrence R.]

For the more negative drivel.

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 .

(My BOLD, Underline, large print, and italics...)

Ease up, guys....

It was my thought that this was a good idea, or even viable...i had suspected, as came out in this thread, that many lenders may already be doing this...I was hoping to smoke that out...

Sometimes you guys jump off on me in a way that makes me wonder if you even read my posts anymore, or if you just react to what you figure I am trying to say...

Strange.

 

[Ken B]

In Lawrence's defense, this topic was the subject of debate a year or so ago and a couple of heavy hitter CGs were promoting the idea that an appraiser should consider risk factors associated with the borrower when valuing a property. One CG, in particular, made a compelling argument for evaluating borrower risk in the appraisal process. The majority of the participants agreed that risks associated with the borrower were meaningless to the appraisal process.

I think what Lawrence is trying to establish is a "grading" system for appraisers based on loan performance. Theoretically, it sounds like a good idea. Practically, there are too many factors outside of the appraiser's control which can cause loans to go bad.

When a loan goes bad, should the appraisal be reviewed to determine if a less than credible report was associated with the lending decision? I think that is already being done.

 

[Offshore]

Sometimes you guys jump off on me in a way that makes me wonder if you even read my posts anymore, or if you just react to what you figure I am trying to say...Strange.

Excellent point. The goofy clique which is embedded in here all hours of the day would have reacted far differently if one of their own had broached the same question. Even so Lawrence it's their turf and you should have known better. Ten lashes, a yellow card and a stern warning from the mods for you!

On topic, FHA had a default scorecard identifying the appraiser a few years back, but I think they discontinued it.

 

[c w d]

Attaching appraiser liability to loan performance is not anywhere approaching a sound idea. We'd spend most of our time trying to verify information that was only available from the client. The client could completely manipulate that whole process. And in the end, even if they didn't we would spend many hours, more than the actual appraisal, evaluating a loan and our risk to only decline the assignment.