Where Do You Think "geographic Competency" Begins And Ends?

[George Hatch]

cert 12. I am aware of, and have access to, the necessary and appropriate public and private data sources, such as multiple listing services, tax assessment records, public land records and other such data sources for the area in which the property is located.

The certs thought MLS important enough, I assumed GH meant it as part of the same data a local appraiser has access to...perhaps these polls to be meaningful need to be more specific , if not we answer from our own perspective.

I thought it was important enough to include it as one of the fundamental assumptions in the poll I posted. Precisely because I didn't want it to be a variable that would unduly influence the responses.

 

[hastalavista]

"Today, there is a push to use third-party inspectors to collect the data. Will you adopt this change or continue to collect the data yourself? Or will you hire a trainee to collect the data for you? Either way, first generation inspection apps are dead because you’re not going to pay anyone to fill out a 1004 form in the field on their iPhone. You want high efficiency when you’re paying the bills.

The key to making this decision and others like it is remembering that you are in the valuation business. You produce and sell property valuations – that does not ever change. What does change, is how you produce property valuations. If you always aim for producing valuations better, faster, cheaper, it’s hard to go wrong when selecting new technologies to invest in."



https://www.appraisalbuzz.com/are-you-an-early-adopter/

I highlight the last sentence just for JG!!!!

I thought this was a good article. I understand Bradford (Clickforms) has a product to sell.
In the article, it didn't advocate one way or another who was doing the inspection. In the article, it talked about a change in the data collection process at the inspection. From what I got out of it, rather than digitally filling out the form, now one enters the information in a more in-the-field friendly format, and the information (I'm presuming) is then populated into the form.

Full disclosure: I know Jeff Bradford. We are not drinking buddies, but have worked together on appraisal presentations (I also use Clickforms). One of the best things I heard him talk about was how Big Data was really starting to make its move into the laps of the clients and there would be more push for appraisers to adopt some of that technology. He gave this warning (which I will summarize):

These tools can be helpful, but don't use them as a substitute for your knowledge; the danger is if too many appraisers just default to the automated answer; if that happens, clients will begin to ask themselves, "If the appraiser always agrees with the data, how much added value to the process does the appraiser provide?"​

A very relevant discussion even though it was uncomfortable for some.

His advice in red is good as well: We want to produce our product to a higher quality (better), as quick as we can, and at a reduced cost. All three are inter-related. If I cannot get better with faster and cheaper, then the new technology is not a likely option for me!

(I might pay more for better quality and faster: I might pay less for faster and the same quality. What I cannot do is pay less for faster and worse quality or less for the same speed and worse quality).

 

[Meandering]

Still not an appraisal standards issue as such. Those regulations are aimed at the lenders' conduct, not appraisal standards or appraiser conduct. The feds don't directly regulate appraisers - the states do.

It doesn't matter where the requirements a USER has come from, those requirements still form a user expectation within the context of a SOW decision.

You want to repeat that from the competency rule. About laws and regulations that apply to the assignment? Or do you want to say the TILA does not apply to the assignment, it only applies to?????


I can’t wait to read this. Go ahead and explain why TILA is not applicable to the residential lending appraisal

Haven’t read a good bedtime story in awhile.

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[Mr Rex]

To some geo-compentency begins (and ends) at the end of their personal driveway or as far as their eye can see from there or the most remote area of their respective MLS coverage. Myopic thought processes are not limited to appraisers but seems inherent in some. I have personally performed appraisals 4 + hours from home in beach front communities for several different private clients over the years. I made the clients aware of my lack of geo competency in the area(s) and that it would take some due diligence to come up to speed etc. In the end I was able to spend several days to a week at the beach and provide the clients what they wanted, an unbiased opinion of value. These were some of the most rewarding (monetarily and developmentally as an appraiser) that I have ever done. I wish I could do this more often, maybe with a 50/50 split between beach front summer assignments and ski slope front winter assignments as the ideal. In any case, developing Geo Competency is not Rocket Surgery that requires years of local occupancy as some might suggest. Does that mean the end of the local yokel best appraiser? Hardly. Sometimes it is what it is as it always is when developing an opinion of Real Estate value...

 

[George Hatch]

You want to repeat that from the competency rule. About laws and regulations that apply to the assignment? Or do you want to say the TILA does not apply to the assignment, it only applies to?????


I can’t wait to read this. Go ahead and explain why TILA is not applicable to the residential lending appraisal

Haven’t read a good bedtime story in awhile.

.

I never said that. You're laughing at a strawman and mischaracterization of your own fabrication.

Those laws and regs are enforceable on the lender by their respective regulators. Appraisers are not subject to regulation and discipline from the banking regulators; we're regulated by our respective state boards based on the state laws and regs, not the federal laws and regs.

What the users need from the appraiser comes under the category of assignment conditions for those particular assignments regardless of the origins of those requirements. The requirements of the COMPETENCY RULE apply to all the elements of an assignment. If we screw up on one of the elements the lender needs then that's where the USPAP violation comes in and it will be the USPAP violation - not TILA - that our regulators cite us for.

Geez, you seem to be in dire need of a laws/regs course as well as a USPAP course, to better grasp where these requirements begin and end. The reason we need to be familiar with the lender's obligations under FIRREA and TILA is to better understand what they need to be in compliance, not because those requirement apply directly to us.


Do this: go back into the discipline notes for licensees in your state and see if they cite any violations of federal laws/regs in their disciplinary notes. See if your state board is enforcing TILA on appraisers (they aren't). I think what you'll see are violations of state law and USPAP references.

 

[Renee Healion]

To some geo-compentency begins (and ends) at the end of their personal driveway or as far as their eye can see from there or the most remote area of their respective MLS coverage. Myopic thought processes are not limited to appraisers but seems inherent in some. I have personally performed appraisals 4 + hours from home in beach front communities for several different private clients over the years. I made the clients aware of my lack of geo competency in the area(s) and that it would take some due diligence to come up to speed etc. In the end I was able to spend several days to a week at the beach and provide the clients what they wanted, an unbiased opinion of value. These were some of the most rewarding (monetarily and developmentally as an appraiser) that I have ever done. I wish I could do this more often, maybe with a 50/50 split between beach front summer assignments and ski slope front winter assignments as the ideal. In any case, developing Geo Competency is not Rocket Surgery that requires years of local occupancy as some might suggest. Does that mean the end of the local yokel best appraiser? Hardly. Sometimes it is what it is as it always is when developing an opinion of Real Estate value...

MR I limit geographically so I can take more interesting work. By sticking to a reasonable area, I can gain more competency, learn more to do more interesting work. In such a small area, I have done tribal land, oceanfront, high-performing new constructions, property in a 100-yr old camp meeting community (limited market), among other things. That is in the last year (doing my tax prep as we all argue this weekend, so I have been looking at the mix.)

You know what, all this growing and thinking and reading and research is exhausting! lol Enough with "interesting"--I would like some of these "typical" sfrs of which Geo speaks! Not to churn like our production brethren here, but for a breather.

 

[Meandering]

I never said that. You're laughing at a strawman and mischaracterization of your own fabrication.

Those laws and regs are enforceable on the lender by their respective regulators. Appraisers are not subject to regulation and discipline from the banking regulators; we're regulated by our respective state boards based on the state laws and regs, not the federal laws and regs.

What the users need from the appraiser comes under the category of assignment conditions for those particular assignments regardless of the origins of those requirements. The requirements of the COMPETENCY RULE apply to all the elements of an assignment. If we screw up on one of the elements the lender needs then that's where the USPAP violation comes in and it will be the USPAP violation - not TILA - that our regulators cite us for.

Geez, you seem to be in dire need of a laws/regs course as well as a USPAP course, to better grasp where these requirements begin and end. The reason we need to be familiar with the lender's obligations under FIRREA and TILA is to better understand what they need to be in compliance, not because those requirement apply directly to us.


Do this: go back into the discipline notes for licensees in your state and see if they cite any violations of federal laws/regs in their disciplinary notes. See if your state board is enforcing TILA on appraisers (they aren't). I think what you'll see are violations of state law and USPAP references.

Best you re-read those laws again and see who they are not enforceble on.
Cause if you think it’s appraisers, you are sorely mistaken. And while you are re-reading the TILa, you can consider why USPAP says “The appraiser must determine the SOW...”. For the intended use. Not for the intended user. Not for whatever assignment conditions the client decided. Nope appraisers have to know this law applies to the assignment and the appraiser determines the SOW considering the requirement of the TILA, along with any other law or regulation applicable to the assignment.

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[George Hatch]

The appraiser is responsible for identifying all the applicable expectations as an appraisal standards requirement, not a banking requirement, per se. That's why we need to know what is required of these lenders by their regulators. That doesn't mean those laws apply specifically to the appraiser - they apply to the lender. It's the lender who gets tagged by the feds if they take an appraisal in that is inadequate. If/when the lender or even the feds complain to the state then the appraiser answers to the state.

This is basic stuff. i shouldn't be having to explain it to you.

This is all a meaningless tangent anyways. The banking regulators are reconsidering exactly what they do and don't need on a regular basis, and that will include whatever alternative valuation products they allow the lenders to use. That some of these lenders have already been using alternative products for certain situations speaks for itself as to what is and isn't carved into stone and circling the Sun.

Lookit, I intend to stick to the same program I've been doing unless/until the environment in which I work changes. Which it hasn't so far, but it might someday. I do not mind one little bit if you make the same decision for what you do. It was never my intention to convert you or anyone else to one side or the other in this discussion - only to prompt you guys to kick it around a little to see what makes sense to you.

 

[Eli]

The appraiser is responsible for identifying all the applicable expectations as an appraisal standards requirement, not a banking requirement, per se. That's why we need to know what is required of these lenders by their regulators. That doesn't mean those laws apply specifically to the appraiser - they apply to the lender. It's the lender who gets tagged by the feds if they take an appraisal in that is inadequate. If/when the lender or even the feds complain to the state then the appraiser answers to the state.

This is basic stuff. i shouldn't be having to explain it to you.

This is all a meaningless tangent anyways. The banking regulators are reconsidering exactly what they do and don't need on a regular basis, and that will include whatever alternative valuation products they allow the lenders to use. That some of these lenders have already been using alternative products for certain situations speaks for itself as to what is and isn't carved into stone and circling the Sun.

Lookit, I intend to stick to the same program I've been doing unless/until the environment in which I work changes. Which it hasn't so far, but it might someday. I do not mind one little bit if you make the same decision for what you do. It was never my intention to convert you or anyone else to one side or the other in this discussion - only to prompt you guys to kick it around a little to see what makes sense to you.

Your consistent. You preach intended use/user, experience.


You ignore antitrust law and criminals that were never prosecuted in mortgage fraud.

You ignore many other market influences in the mix.

Why don’t you want more credible and reliable for public instead of fastest and cheapest?

Your getting on my nerves. Don’t worry about it. Lol

Ignorance is bliss.


GH, there is a huge dichotomy in your stances. You may not be trying to present the dichotomy but you are none the less.

 

[Carnivore]

I see most of this as simple bean counter economics and efficiency of lenders. Faster, cheaper and no delays all the while with the same profit margin. Faster they can produce a loan the more profit they realize because they can generate X number of loans in a shorter period of time. Dehumanize the whole process and Boom one button push mentality. You don't even have to come face to face with an actual person. Apply on-line, instant credit, instant employment verification. What is left? The collateral.

How can you speed that up? Well first lets reduce the cost of the valuation and speed up the time to delivery. The desktop is a official way to let Appraisers have runners. Remember Skippy used runners.

Is there another profession that's experiencing the same type of Technology evolution. Look at the medical industry. Decades ago when I was a child a Doctor would actually come to your home. Now its totally different. Sometimes you never even see a Doctor. You make an appointment on-line. You go to the Medical Facility. You check in with a person or like me I check in for Healthcare at a Federal Healthcare Facility Terminal with my ID card. I sit down. Person Calls me in. Takes my vitals just sitting in a high tech chair. I see a person who reviews my meds and validates the refill series(I order refills on line). I may or may not see my doctor. Most of the time I don't. I see a PA or a RN. then I am done. I am out of there scheduled to come back in every six months. Many only come in for Well Care Visit annually.

So who else is going to have to adapt and change? AMC's! One thing AMC's have got to do is open end some of their fee structure system. Almost every assignment outside of Urban and Dense Residential(cookie cutters) has to be an open ended Fee. Lenders want a standard across the board fee! They know that most of the loans will fit into the set fee. Smart AMC's know that this is not true. They will also have to adapt and automate much of the review process. Smart one will do that, others will not and they will fall away and die. Smart AMC's will recognize based on address that a particular residential assignment will require a much higher fee and better trained/experienced appraiser.

So I could go on and on and I am sure I missed many things. I think you get the point. So I have one last point to make. You CG's are not immune to this Technology Revolution. Having said that, you CG's have a leg up on Residential and that is you are better prepared to adapt to changes.