Appraisers' Free Forum

Bill Caudell · by **Bill Caudell** on Fri Oct 05, 2007 12:16 pm

Never thought much about working for a bank. Therefore, I need some opinions from the forum posters.

My license level is Licensed Residential and if/before I accept a job from a bank, I have a few questions.

If, I am competent to review commerical and the review does not require an opinion of value, but the transaction value exceeded $250,000, would I be performing an assignment not allowed at my license level?

I looked in USPAP and DPOR (Virginia) and still am not certain. Contacted (e-mail) DPOR, no reply yet and just figured I would post here for insight and opinions.

Also, I wonder what most probably would/could/should/should not happen with and/or to my relationship with my local (somewhat small town/region) peers?

I would look at that (Licensed reviewing CG) very similar to "skippy" reviewing my work, and not certain I would like being in that position. Therefore, I post this question in hopes of getting serious replies.

Anyone with past, similar experience, or anyone just want to put your 0.02 worth in, to the above stated, please respond.

Joker · by **Joker** on Fri Oct 05, 2007 12:39 pm

I would say that given your license level, you would be outside the scope of your license to review a commercial appraisal. That doesn't mean that you are incompetent, but that you aren't licensed to do it.

If however, you are an employee of the bank and they understand that point, then there may not be a problem with it (subject to your state regulations).

I am not sure I understand the question about your peers. Do you mean will they take issue with you reviewing their work if they have a higher license level than you and the review is outside the scope of your license? If so, then you could anticipate some resentment.

The best answer, keep working toward increasing your license level.

Edd Gillespie · by **Edd Gillespie** on Fri Oct 05, 2007 1:40 pm

You are in the position of asking if you are competent? Let me put it this way, and it is snotty, if you have to ask you are not.

Each state sets its own levels of licensing and what goes with what, but I understand they are pretty similar. Federal oversight is being tried for appraiser and its a dismal failure, but for now we have this sort of hybridized authority to answer to that is more monster than anything. In CO no doing commercial stuff untill you get certified. So it may be that you need to ask somebody in Virginia. My bet is you are not going to be doing this review and probably should not. Good learning opportunity though if you can finesse that part.

How can you consider reviewing what somebody else did when you don't know how to do it yourself? That's sort of review 101.

Bill Caudell · by **Bill Caudell** on Fri Oct 05, 2007 1:41 pm

Joker wrote:I would say that given your license level, you would be outside the scope of your license to review a commercial appraisal. That doesn't mean that you are incompetent, but that you aren't licensed to do it.

If however, you are an employee of the bank and they understand that point, then there may not be a problem with it (subject to your state regulations).

I am not sure I understand the question about your peers. Do you mean will they take issue with you reviewing their work if they have a higher license level than you and the review is outside the scope of your license? If so, then you could anticipate some resentment.

The best answer, keep working toward increasing your license level.

Yes, a concern is resentment, as in my market it is a "close nit" group of appraisers. Respect both ways exists presently and I like that and hate the idea of it becoming strained.

Bill Caudell · by **Bill Caudell** on Fri Oct 05, 2007 1:50 pm

Edd Gillespie wrote:You are in the position of asking if you are competent? Let me put it this way, and it is snotty, if you have to ask you are not.

Each state sets its own levels of licensing and what goes with what, but I understand they are pretty similar. Federal oversight is being tried for appraiser and its a dismal failure, but for now we have this sort of hybridized authority to answer to that is more monster than anything. In CO no doing commercial stuff untill you get certified. So it may be that you need to ask somebody in Virginia. My bet is you are not going to be doing this review and probably should not. Good learning opportunity though if you can finesse that part.

How can you consider reviewing what somebody else did when you don't know how to do it yourself? That's sort of review 101.

Re-read my post, please. I clearly state if competent to do so, would I be exceeding my license, and clearly stated I have inquired with state board. Have not gotten a response as of yet.

Also, it would not per say be an assignment, it would be a full-time job (employee/employer relationship) with a local bank.

Edd Gillespie · by **Edd Gillespie** on Fri Oct 05, 2007 2:06 pm

Bill Caudell wrote:Re-read my post, please. I clearly state if competent to do so, would I be exceeding my license, and clearly stated I have inquired with state board. Have not gotten a response as of yet.

Also, it would not per say be an assignment, it would be a full-time job (employee/employer relationship) with a local bank.

OK I reread it. Same answer.

But I guess the last part reveals it doesn't even matter under USPAP if you graduated from high school or speak english since you will be providing valuation services and it doesn't matter if you are competent or even breathing. They can't get you when you operate outside of USPAP, so you are asking the wrong question. USPAP and the state board could care less. I do, but your board and any TAF guys can't do anything and don't care.

Jim Plante · by **Jim Plante** on Fri Oct 05, 2007 2:18 pm

Bill, your board's going to be your best source on this one; I think it'll depend on their viewpoint as much as anything. Since you *are* licensed, they may hold you to the state's restrictions.

On the other hand, you're an employee, and don't even have to be certified to review anything, since you're doing it for your employer.

W/R/T resentment, I think you can nip that in the bud. If your appraisal community is a close-knit one, then when you get a commercial report to review, call the appraiser and ask him if he's got time to walk you through it. Tell him you're over your head and out of your league, but you've gotta do it anyway. I think you've been around enough to separate the BS from the gold. And you've always got the forum here to fall back on in the event you think you're being bullshat.

tel · by **tel** on Fri Oct 05, 2007 8:51 pm

Bill, I am a CRA & would not touch that review with a ten foot red highlighter.

I would tell the client I would not do the review for the following reasons.

1. I am a LRA.
2. Even though I feel I could do credible work on the review, there is a a possiblilty an LRA doing the review would raise 'competency' issues, and that might put your bank in a negative situation. My goal is to protect my client, and opening you up to possible complaints is not protecting you or me.
3. May I recommend Xxxxxx Yyyyyyy. I have heard nothing but good about his/her ethics and competency.

Goodpasture · by **Goodpasture** on Fri Oct 05, 2007 9:54 pm

Bill Caudell wrote: If, I am competent to review commerical and the review does not require an opinion of value, but the transaction value exceeded $250,000, would I be performing an assignment not allowed at my license level?

USPAP does not address license levels. It does address competency. Underwriters review appraisals. Have a knowledgeable person doing them is a step up. If you as a licensed appraiser cannot follow the logic of an appraisal, and determine whether or not the appraisal is valid, then the appraisal is not credible. Not to a Licensed, not to an underwriter, and not to a lender.

The only question is "will the state allow it" and only your state can answer it. If they say "no" then ask them if they hold underwriters and processors to the same standard.

Bill Caudell wrote: Also, I wonder what most probably would/could/should/should not happen with and/or to my relationship with my local (somewhat small town/region) peers?

Whether you are a trainee or a Cert gen, when you challenge an appraisers work, expect an angry response. A professional appraiser will address the issues you raise concerning a report. A skippy will attack you for your license level, and should probably be put on a do not use list.

Bill Caudell wrote: I would look at that (Licensed reviewing CG) very similar to "skippy" reviewing my work, and not certain I would like being in that position.

The only real question, is "are the reviewers problems with the appraisal credible." If you use your position to run your competition out of business, then you are not credible. If you use your position to clarify issues so your bank can make informed business decisions, then your license level is irrelevant.

Edd Gillespie · by **Edd Gillespie** on Fri Oct 05, 2007 10:59 pm

Goodpasture wrote:If you as a licensed appraiser cannot follow the logic of an appraisal, and determine whether or not the appraisal is valid, then the appraisal is not credible. Not to a Licensed, not to an underwriter, and not to a lender.

Sorry, as good as the rest of it sounds, I'm just not buying that one hook line and sinker. There are plenty of licensed appraisers who have no logic in their own appraisals. I am not casting aspersions at Bill. Your comments seem to indicate that review is a walk in the park. Appraisers of all of those you mention should be more aware of their own shortcomings and responsibilities with respect to review. I just don't think being licensed as an appraisers automatically bestows the wisdom a reviewer needs.

I had an opinion from a reviewer the other day who insisted that SFR sites had to be adjusted by the square foot. The comps themselves belied that, but the guy had a license so he had to know what he was doing. After all he works for what some call a large AMC. This wasn't even a commercial appraisal, just a simple littel FHA SFR fixer upper deal.

I fear appraisers are going into review because it is a paid position and they expect to hack appraisals to pieces, not because it is their opportunity to be of service and improve the profession. Fine with me if you get paid and you should be well paid, but remember what the profession and the public trust needs from you.

Goodpasture · by **Goodpasture** on Fri Oct 05, 2007 11:11 pm

Edd Gillespie wrote:
Goodpasture wrote:If you as a licensed appraiser cannot follow the logic of an appraisal, and determine whether or not the appraisal is valid, then the appraisal is not credible. Not to a Licensed, not to an underwriter, and not to a lender.

Edd Gillespie wrote:There are plenty of licensed appraisers who have no logic in their own appraisals.

That is a competency issue, not a license level issue. I know of cert res and cert gens who display no logic.

Edd Gillespie wrote: Your comments seem to indicate that review is a walk in the park.

No, I am assuming that, in accordance with the original premise, that the appraiser, regardless of license level. is competent.

Edd Gillespie wrote:Appraisers of all of those you mention should be more aware of their own shortcomings and responsibilities with respect to review. I just don't think being licensed as an appraisers automatically bestows the wisdom a reviewer needs.

Again, a competency issue. Being certified doesn't automatically bestow anything either.

Edd Gillespie · by **Edd Gillespie** on Fri Oct 05, 2007 11:24 pm

You see we agree. I knew you meant a appaisal license is not a knighting of knowledge and good sense. I am more than willing to agree that certification isn't either, and I don't think I said that I did or implied it. We may depart here though. I think reviewers, like appraisers, should be required to know what they are doing whether it is administrative desk top or field.

Who's watching the watchers? What a mess.

Goodpasture · by **Goodpasture** on Sat Oct 06, 2007 1:28 pm

Edd Gillespie wrote: I think reviewers, like appraisers, should be required to know what they are doing whether it is administrative desk top or field.

We have three types of reviewers out here, and we need just one type. One type is hired to affirm the original appraisal, and unless the report is egregious, it gets rubber stamped. Another type takes the opportunity to shred whatever is presented and is particularly comfortable if what he is shredding is from his competition. The other type is one that follows the logic presented in the report, identifies unreasonable and unsupportable assumptions, identifies illogical statements of "fact." Verifies the data presented, and applies USPAP to the analysis. This last type needs a firm understanding of USPAP, the ability to understand the methodology and terminology used by the appraiser, the logic and development process of the appraiser, and an understanding of the appraisal process and how it was applied in the report being reviewed. This is not something that is addressed by any licensing level.

I think one thing that needs to be done by some appraisal organization somewhere is to establish standards for reviewers that lead to specialization in that field. Just as attorneys specialize, (tort, contract, real estate, etc) and Doctors take special classes in diverse fields for their specialization, so should appraisers. A Cert Gen who does high rise office buildings exclusively has no more business doing a house than a Cert Res has doing a high rise office building. And neither one should be doing reviews unless they are trained in reviews. But once a person can handle reviews for one type of property, I see no difficulty in him doing reviews across the board simply because the process of reviewing is similar across the board. It is like a restaurant reviewer.......he doesn't have to know how to prepare the dish. He simply has to know if it is good or bad. If he uses his magazines review to promote the competition he is unethical. If he is hired by the restaurant manager to give a glowing review, regardless of the quality of the food, he is a Skippy. If he gives an honest report as to the quality, taste and presentation of the food, he is a good reviewer. And for that kind of reviewer, licensing is irrelevant.

Otis · by **Otis** on Sat Oct 06, 2007 4:49 pm

Goodpasture wrote: I think one thing that needs to be done by some appraisal organization somewhere is to establish standards for reviewers that lead to specialization in that field. Just as attorneys specialize, (tort, contract, real estate, etc) and Doctors take special classes in diverse fields for their specialization, so should appraisers. A Cert Gen who does high rise office buildings exclusively has no more business doing a house than a Cert Res has doing a high rise office building. And neither one should be doing reviews unless they are trained in reviews. But once a person can handle reviews for one type of property, I see no difficulty in him doing reviews across the board simply because the process of reviewing is similar across the board. It is like a restaurant reviewer.......he doesn't have to know how to prepare the dish. He simply has to know if it is good or bad. If he uses his magazines review to promote the competition he is unethical. If he is hired by the restaurant manager to give a glowing review, regardless of the quality of the food, he is a Skippy. If he gives an honest report as to the quality, taste and presentation of the food, he is a good reviewer. And for that kind of reviewer, licensing is irrelevant.

[font=Comic Sans MS]I agree with you completely, except from the aspect of me (CRA) reviewing a commercial report (I can review it to see if it flows, has credible and correct information about the rentals/sales/leases, etc., but I would not say that I would be qualified to ascertain if the appropriate approaches were utilized and if so, were they completed in an appropriate and correct manner - JMHO). However, in reference to Bill's question, I would strongly suggest that he get a firm "written" response to this particular question from his state board. We can provide our opinions, ideas and suggestions here, just like on any forum, but it comes back to "who has the power to approve or disapprove (slap his hands)".[/font]

Goodpasture · by **Goodpasture** on Sat Oct 06, 2007 5:15 pm

Otis Key wrote:[font=Comic Sans MS] However, in reference to Bill's question, I would strongly suggest that he get a firm "written" response to this particular question from his state board. [/font]

I doubt the state board has any regulations requiring licensing of any kind. Remember, he is not being asked to provide an opinion of value. Just an opinion on the credibility of the report. I, for one, applaud the Bank for taking this out of the underwriting/processing department, and hiring someone with a fundamental knowledge of appraising.

Appraisers' Free Forum

Opinions/Facts Please

Opinions/Facts Please

Re: Opinions/Facts Please

Re: Opinions/Facts Please

Re: Opinions/Facts Please

Who is online