Back to the basics

The more I read residential mortgage related appraisals, underwriter comments and comments from the quality assurance departments from major lenders, the more I have come to realize that it is far beyond time to get back to “preaching” about the basics of this industry. For those of you who have been in the business back when you would take the photos, pull it out of the camera, wait a few moments before you pulled the front off the photo before coating it with the “magic wand” to keep it from fading (thank you Polaroid), I would recommend moving on to another post.

But for the so-called experts of residential appraisal, the current brand of underwriters, and quality assurance “experts” that are being paid to “play appraiser, lawyer and industry regulator” please pull up a chair and let’s puzzle through a few of the basic of this business.

First of all, if you are going to challenge the appraisal report, and your basis for this challenge is UAD please understand this a Uniform Dataset that was mandated by Fannie Mae for the purposes of selling the loan packages to Fannie and Freddie. These dataset requirements are important and should be honored by the appraiser; however, there is no actionable items with regard to prosecuting the appraiser.

Secondly, USPAP has been made the law in all fifty states with regard to regulating the appraisal process and how the report should be presented; however, before you wish to challenge an appraisal report using the Standard Rules of this document it is imperative to take a few ethics courses so that you understand the proper use of this document. Standard 1 of USPAP is for the development of the appraisal. It is really difficult to determine if the process has or has not been followed by evaluating the report. Standard 2 was governs the reporting of the appraisal.

This is the first of several posts, the next series will address various sections of the report and presentation that seem to get overlooked more often than others.

See you around, the water cooler!

UncleZev

 

A world bereft of humor

A world bereft of humor is like a woman without sex. It may be full of wonder, or mystery, or agony and pain, but what’s the point really?

I have decided to take my daily rants and in express them here for all to see, appreciate, or disagree. My wife, family and close friends will no doubt be so pleased that they do not have to continually deal with my inner monologue as it spills back to the blog rather than being freely shared with anyone, in my community who will still listen.

In my position as a review appraiser I speak to appraisers across the country and have recently had the unique opportunity to speak to several “second generation” appraisers like myself. This has been refreshing and left me with a sense of hope and a new-found appreciation for the profession. Of course, for those who know me, I will never really lose my sardonic or sarcastic  approach towards this profession, but it has been refreshing to have a bit of life brought back into my inner monologue.

For instance, I was recently asked to mediate several situations where the client, who will always and forever remain nameless in my rants, believed the report appraiser to be uncooperative and almost incompetent in their presentation of their reports. The appraiser on the other hand was never really privy to the lender‘s attitude but was forced to try to understand the continual barrage of questions that would be brought to them daily, in some instances.

At first blush, I received the request from my manager to mediate this with a degree of frustration to think “What has happened to professional trust?” and “Why, the incredibility rude word starting with the sixth letter of the alphabet, am I even still working for this company that would ask to me mediate in situations like these?” Then I had an epiphany, which for a good Jewish boy is a bit odd to start with, but it was indeed a sudden realization that over took my thinking without reasonable proof, thus I don’t know what else to call it, but I digress. I realized that my current boss was the very reason that I even entertained working for the company that I choose. This man is also a second generation appraiser who very much understands the whole equation. He had selected me to mediate this dispute because he was looking for me to be prompt, professional, and objective. Not allowing either side to debase their arguments with petty dogma that has found its way into the lending community with regard to real estate appraisers.

Of course there are certain levels of detail that would be inappropriate to be revealed in this particular forum, but suffice it to say, at the end of the day, both the lender and the appraisers found a mutual respect for one another and the appraisal reports were accepted and funded without further hassle to the report appraiser.

I believe that many “old timers” like myself have to a very significant degree have lost sight of the actual reasons they choose this particular profession, or rather they found themselves “drafted” into the profession. The underlying reason is a drive to present a fair, balanced, opinion without favor or bias to any side of the transaction. Whether it is a legal, financial, or civil matter every transaction needs those who can separate themselves from each side and remain objective and present an impartial opinion that is based upon an analysis of the marketplace itself.

Lenders are not maniacal institutions that are hell-bent on the destruction of the “American Way”, for the most part. In turn real estate appraisers are not individuals who failed at every other attempt to make money so they settled for “pulling tape”, “crunching numbers”, and killing every possible deal so that lenders will not be saddled with collateral that the borrow can not afford.

The truth is that both, real estate appraisers and mortgage lenders, serve a much-needed role;  when they operate in a manner that is consistent with their design and function. When they do not operate in this way, it is at that time that mediators like myself and my boss are very much-needed to try to help each side “play fair”.

I want to encourage anyone still reading my blog, to “fight the good fight” there are literally millions of consumers who really do not understand the dynamics of what I have just said. It is for them “the public” that we continue to hold steadfast to our ethics and beliefs that have shaped the larger whole of the appraisal profession.

Hope to see you around the water cooler!

Uncle Zev