Appraisers' Free Forum

There is some real hair splitting going on here! 62 pages for appraisers, 6 pages for realtors (brokers and salespeople).

http://com.ohio.gov/real/docs/real_Appr ... ipline.pdf

I couldn't read all 62 pages, but I am a fan of the method of reporting that is used in Ohio. Very useful information.

As for hair-splitting, I didn't see any. What is a problem for appraisers is that they accept assignments for de-minimus fees, which implies, no....justifies, a de-minimus SOW and then if the regulators get a hold of it they require de-maximus adherence to every known standard. Sort of a self-contained file for cheap-quick appraisal report. I see the need for documented support for appraisals, but the clients will not pay what it costs to create it. It seems when reports come under scrutiny of the state the business the focus becomes 100% academic. I've never heard an regulator opinion say, "they got what they paid for."

Seems like Ohio may be playing that version of "kick the can." Somebody needs to inform the cops that the SFR lenders aren't contracting for regulator versions of USPAP compliant appraisals. That is just the way it is. It must change, but don't expect any understanding from any of the established appraiser clubs, boards or institutions. I recently had the opportunity to work with some appraisers who were turned in by a competitor. Being from a state where no complaint, other than one from a mortgage broker, goes unpunished, we knew trouble was unavoidable. The allegation from the complainant was fraud. Three guesses what the sanction was. Appraiser didn't maintain a complete work file, $1,000.00 fine and 30 hours of classes. Seems the summary report contained some adjustments the support for which was not in the work file. Well there goes 100% of the profession in CO I am acquainted with. I defy you to find any official list of what must be in any appraiser's work file. I don't think one exists.

Does anybody seriously think sense will ever come of this? I certainly do not think appraisal standards should be lower, but the witch hunt must end. I haven't done it yet, but a SOW for these AMC cheapies has got to be developed. Then, at least if the AMC agrees to the attenuated SOW for the attenuated fee, an appraiser may have a leg to stand on in court. I do not expect the regulators here to be impressed with the law any time soon, so the solution does not lie in that quarter. Seems the regulators' job is focused on increasing revenues via fines.

Anybody want to help?

I don't want the state to decide how much to adjust for what line item. It seems some nit-picking is about persoanl preference and or underwriting guidelines and not USPAP violations. However, I have been old that the appraisals are pretty bad and they stack up complaints to make the punishment more severe.

Nonetheless, maybe they will publish a list so we can make appropriate adjustments and not get in trouble for failing to make a fireplace adjustment.

I was reading (skimming) through this, and ran across a reference to the appraiser not having reconciled a two-year-old prior sale of, say, $27,000 with the sale price of $70,000. They said it violated USPAP not to do that. I was thinking, "This is BS. There's no requirement in USPAP to reconcile prior sales with current sale prices." So I continued reading--for another whole page--of other stuff this guy did on two appraisal reports (or was it three?) They revoked him. Good riddance.

Maybe the Ohio board didn't spell out that particular violation in enough detail to suit me, but there was enough other stuff to fully justify the revocation.

The seven-day suspensions aren't much of an economic sanction. Neither are the $300-$500 fines. But now those guys will have to report that they've been disciplined and suspended. E&O will go up (if they can get it at all). Credibility with clients will go down. I think Mickey-D's is hiring.

Joker wrote:I don't want the state to decide how much to adjust for what line item. It seems some nit-picking is about persoanl preference and or underwriting guidelines and not USPAP violations. However, I have been old that the appraisals are pretty bad and they stack up complaints to make the punishment more severe.

Nonetheless, maybe they will publish a list so we can make appropriate adjustments and not get in trouble for failing to make a fireplace adjustment.

It really is about holding the regulators to reasonable standards. USPAP lacks published specifics, intentionally I am told, enforcement should not. And yet enforcement continues without them. That is why I am a fan of Ohio. At least they publish transgressions of what they consider important in detail after the fact, which gives appraisers notice. That helps the entire industry.

USPAP requires that appraisers maintain a work file. Where is the list of what must be in it? The industry needs at least that much specificity to meet minimum standards of due process. Without publication of standards, the boards are acting capriciously even though they want sincerity.

I don't think the state should be making up adjustments either, but if proper support for adjustments is missing from a work file, then the state must be held a least to the standard of telling us what support is acceptable. We all know extraction from the market by paired sales will leave most things unadjusted. So what do they want for their $1,000.00?

I caught that one too, Jim. Why on earth should it be mentioned and stated to be a violation? As I said, it seems that the bad eggs are being tossed but by what standards are we all now expected to uphold? I've never reconciled a 2 year old expired listing and I certainly wouldn't feel the need in a case where the listing was higher than the appraised value.

You've got to remember that these are summaries, not legal documents. They're not prepared by high-end people, but by administrative assistants. It may be that failure to explain a $50K price increase in two years was significant to the reviewers, and got interpreted as the governing factor in a decision that was aimed somewhere else.

Besides, there was enough else wrong with that guy's reports that his removal from the profession was of benefit to all of us.

Edd said................"I haven't done it yet, but a SOW for these AMC cheapies has got to be developed. Then, at least if the AMC agrees to the attenuated SOW for the attenuated fee, an appraiser may have a leg to stand on in court."

I totally agree. Everyone wants cheap and fast. You can not do thorough & accurate analysis & report writing, etc. for fast and cheap. USPAP does not permit less...unless it can somehow be defined in the SOW.


PS: I like the report that Ohio puts out because it basically explains everything. However, I do not like the format it is in. It is very difficult to read 77 pages of this runon format. After looking at the 77 pages I came up with a '2 column' approach. Left column is what they did & the right column is the law they busted. I took one of their shorter complaints and copy/pasted it in the column layout. Looks pretty good. I think I'll email it to the state. Maybe they will change the way they report these.

Here's my idea for an easier to read complaint list. I copy/pasted the last complaint in the 77 pages.

tel wrote:Here's my idea for an easier to read complaint list. I copy/pasted the last complaint in the 77 pages.

That's the way to go about - IMHO!

Next case in line!