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

[George Hatch]

Meaning? Considering some appraisers work I've seen, working well above their skill set, an honest, howbeit dog-in-fight broker can be an improvement over an imbecile.

Yeah, but if we're comparing for the effect of the different roles on the service then the apples to apples comparison would involve people of more/less equal levels of performance in their respective fields. Not the unequal comparison of our idiots to their rock stars.

Which you always do, and which I was obviously correct in anticipating you would do again in response to my initial observation. Which is why I worded it that way.

And BTW, in your haste to criticize appraiser licensing the manner in which you ignored the impartial/unbiased angle implicit in the comparison between the outside appraiser and one side's "broker friend" jumps right out.

 

[hastalavista]

Right now I just feel like hanging out with my kids.

Nobody can find fault with that!

 

[Terrel L. Shields]

Which you always do, and which I was obviously correct in anticipating you would do again in response to my initial observation.

I guess I missed your initial observation. Sorry to offend you so.

 

[Meandering]

This is actually good news and has been consistent with what I've said before.
The "good news" is that the risk of the alternatives are being evaluated. Although the rating agencies' past* has been a bit checkered, so has everyone else associated with the mortgage meltdown (rightfully or wrongfully).

If these products are deemed more risky, then that risk will (or should) be baked into the terms/conditions of the loan.
You want a PIW or alternative? You only qualify under these conditions and within those conditions, your LTV is limited to X and/or your interest rate will be Y basis points higher.
Investors can decide if they want to purchase the riskier tranche or not; obviously, the riskier the tranche, the higher return they will demand (ergo, a higher interest rate to the consumer). Higher interest is one way to mitigate risk; another is to reduce the loan amount (and, there are more ways than those two).

The higher cost to the borrower if these types of transactions are riskier would, presumably, create a ceiling on how many of these types of transactions occur.

The danger is not in the type of valuation technique/process. The danger is, not identifying and pricing the risk of the transaction if the valuation technique creates a greater risk.

But let us face reality here: If the loan is such that the LTV is sub 50%, collateral risk may be so low that it doesn't matter.

Therefore, and again as I've said, the fight (the winnable and, from my perspective, legitimate) against these types of alternatives is not within the appraiser regulation (USPAP) arena, it is within the banking regulation (including securitization) arena.


* Some may have forgotten... when the rating agencies were hauled before lawmakers and were being sued, one of their defenses was that their ratings are simply "opinions" (just like appraisers). Part of the flack they caught was that some said for certain public transactions, they were required by regulation to rate the instrument (just like appraisers are required to perform appraisals for certain covered transactions) so because they were required, they should be held to a higher standard. However, a debt instrument doesn't need to be rated; it only needs to be rated to qualify for purchase by a certain investor-profile. Unrated securities typically pay a higher rate of return.
The similarities between the rating agencies and appraisers, and the type of instruments they rate and the type of valuation techniques we use, are pretty strong in some ways.

Actually the really good news is that
Appraisers no longer need background checks because they won’t be going into other people’s homes and taking pictures of their bedrooms

Oh all those lovely posts and threads in the archives.

Where is that screaming now over these “inspectors”? Actually where is the vetting of these “inspectors” and how do appraisers access that information and their background checks?

How do appraisers qualify the info comes from a “reliable” unbiased source? How do we know these inspectors are not perverts with grudges and bad credit, with something to hide?

 

[George Hatch]

I guess I missed your initial observation. Sorry to offend you so.

You didn't miss anything. You responded to the observation I made in the manner that I predicted you would. Nor am I offended. All you did was validate my prediction.

If your name isn't Terrel, why do you think 2 sides of the same transaction would prefer to use an appraiser instead of the broker friend one of them knows?

 

[George Hatch]

Actually the really good news is that
Appraisers no longer need background checks because they won’t be going into other people’s homes and taking pictures of their bedrooms

Oh all those lovely posts and threads in the archives.

Where is that screaming now over these “inspectors”? Actually where is the vetting of these “inspectors” and how do appraisers access that information and their background checks?

How do appraisers qualify the info comes from a “reliable” unbiased source? How do we know these inspectors are not perverts with grudges and bad credit, with something to hide?

I'm sure that to whatever extent the users find your questions to be important to them they'll address that in their process.

Whether they do or they don't, it's not our problem. You're only responsible for what you do, not what your clients or users or their other vendors do.

 

[Mr Rex]

Only an appraiser can take the photos (see AMC rule B549.) Only an appraiser can do the "inspection" (most appraisers aren't qualified to inspect a dog house). How can I develop a credible opinion of value under USPAP if I didn't personally inspect? (Take the 15 hour USPAP class and a test before continuing) Is this the end of the world as we know it? Obviously it is, just as it has been for the last 30 years. Go away. It will provide the leeway for those not so faint of heart or reactionary to changes in the continue to thrive. Thank you for your hard headed lack of response to changes in life and appraisals as we currently know them. You will hardly be missed as things move forward. You may consider a career in leather/craft buggy whip making as the up and coming thing. Google Adam and Eve for a source for your finished products.

 

[Meandering]

I'm sure that to whatever extent the users find your questions to be important to them they'll address that in their process.

Whether they do or they don't, it's not our problem. You're only responsible for what you do, not what your clients or users or their other vendors do.

It was never our problem to begin with.
It was always only a straw argument for those who wanted into the pockets of appraisers.
Kinda like, "We're following presumption 1" after years of advertising, "We're playing a flat fee".
They can't keep their lies straight, and now, the money will stop flowing to them.
The problem for res appraisers is that they most likely have no experience working with any value, other than market value. That is sad, because they then miss the opportunity to do private work for investors.

Joe seems a smart guy, as did Notrav that disappeared quietly. So to Joe I will say, take some commercial classes, learn from a good commercial appraiser how to do investment value appraisals. Learn how to apply the if, then, else scenarios to the residential market, and you will find good paying private work . All those "flip this house" wanna be's are looking for "professionals" that know how to make it financially beneficial to them, and to show them how. With tight inventories in the residential market, rents rise, which makes more investor wanna be's.

Think hard Joe. If you want to "be a business" and not just be "self employed" you need to be out there advertising every day, be in the faces of your clients, and potential clients, everyday. You have to know how to "sell" what you know, not just wait on someone to sell it for you and then notify you of work you will do, because they "sold" your service for you and will take a chunk out of your pocket for that. Sitting on the sideline instead of "working your business" is just an indication that self employment is preferable to being in business. Res lending work is not a "business". Never was, no matter how many brokers you knew, because it was still the brokers that placed orders once the lender accepted you, and it's the broker that pushed the sale of your services to the lender to be accepted.

If a service business is what you want. You have the license, go do it, or, go back for better training and then go do it.

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[TC]

Res lending work is not a "business". Never was, no matter how many brokers you knew, because it was still the brokers that placed orders once the lender accepted you, and it's the broker that pushed the sale of your services to the lender to be accepted.
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I have to disagree with that statement. Majority of my clients were banks/S&Ls with any brokers I had taking those loans to the banks. I grew my biz by word of mouth and meeting clients face to face. How is that not a business? Being a res mortgage appraiser in today's business model is being an indentured servant. Name another business in this country where you never meet your clients. Not for me.

 

[Meandering]

Sounds good TC, but still not a business.

Even if you look at your local carpenters. They get the job and are responsible for the final outcome. No one who serves by "the grace of the governor" ever investigates to see if the that carpenter owned a hammer on the day you "bought their service" No state investigator will ever be sent to verify those where 6 penny nails used, and not 10 penny nails. It might have had the outward appearance of a business, but you could not send another carpenter to do part of the work without full disclosure and certification to the client, to which, the client had to approve. Still was just self employment. You might have had the option to use Kodak film or Fugi film in your camera, or to hire Photo Mat or the local drug store to process your film, but that was only to get around employment and tax laws. You could not contract with Photo Mat to process all your film, if your client decided they only wanted pictures from Fugi.

But you did have greater options and opportunities for a wider selection of clients to work for. And there-in you find a big difference. Businesses have customers that buy their services. Appraisers have always had clients, to which the Appraiser owes something to, other than just the product purchased. Appraisers never had any "customers" only "clients".

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