aggie appraiser said:

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Regarding some of the comments about having a condo or a manufactured home used as a comparable sale for a site built home, it's hard to believe those things happened. I have never seen it done or even heard of it happening. Things like that need to be investigated.

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Subject house was a single story by the way.

Can't say that I've ever seen a manufactured home used as a Comp for a built on site structure. That in and of itself should show it was a bogus appraisal...at least that's my opinion.

so many potential problems with the example

What did the appraiser say when the mobile home was questioned? Apparently he was trying to bracket quality/condition and gross living area.

I'm going to look up the appraisal I referenced with a condo as a comp for new construction, 3/4 acre lot in a country club community.

Can't get the snip of the adjustment grid to show up Aggie appraiser but the deal closed May 27 of this year. 4,800 SF to be built, 3/3 acre lot and comp 1 is 10 year old condo. I couldn't have made this up.

What do these people say when they get called out?

I don't know what to say.

Yeah, that's bad.

Who would call them out? As a bank we can't communicate with the appraiser at all.

I'm frankly less impressed with sale #2 than I am with the manufactured home. (Assuming the associated adjustment can be supported)


In the end, it all comes down to the reconciliation. What does it say? I see one possible comparable in that report. (It happens, especially with odd ball properties) if the other two were given no weight in the reconciliation then I have less issues with this mess.

I look at it differently. In general, I really don't think "banks" care (not lenders on here, but the generic bank they work for).

I truly believe that banks would prefer to let the buyer/seller agree what market value is but that politically it became unfavorable to trust people to do the right thing.

So they've taken the approach that if an appraiser (third party) agrees then they are above scrutiny.

This of course leads to less than qualified people in a role with way too much power, but honestly I really don't think the banks care since it keeps them relatively insulated.

About 70% of our loans stay on the bank's balance sheet so we do care about appraisals. As mentioned we can submit additional comps for consideration but all the appraiser has to say is they're not suitable and it's case closed.

jja79 said:

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Who would call them out? As a bank we can't communicate with the appraiser at all.

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jj you are right then wrong. Lenders cannot contact appraisers about value. In any way. But we can talk to them on administrative level. Say invoice bookkeeping stuff.

At the end of the day, I never call an appraiser. And they are not held accountable in the system. It needs to be fixed.

jja79 said:

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About 70% of our loans stay on the bank's balance sheet so we do care about appraisals. As mentioned we can submit additional comps for consideration but all the appraiser has to say us they're not suitable and it's case closed.

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And this. Fooking right on.

Administrative level is another situation entirely. We can't communicate with them concerning the report, their conclusion or the quality of the work.

How do you go about holding appraisers accountable though?

Is there a review appraiser for the lender who handled this? In commercial, I used to have a review appraiser for the lender who is an MAI that reviewed all of my reports and sent feedback with questions. Something like the above happening would not have been ok.

Dallas there is no checks and balance in the system right now and that's the problem

All a review does is see if all the blanks are filled in. If you want to contest the value estimate you appeal to the appraiser who did the report. That's crazy.

Oye.
Good luck in your future endeavors.

p_bubel said:

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Oye.
Good luck in your future endeavors.

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And?

I've been in Mortgage 14 years. And what Mr. p?

Edit: waist of my time.

jja79 said:

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Several specific examples of appraisal issues are cited here. Can you cite any specific instances of regulatory action, court cases involving value conclusions, comparable sales used, reconsideration of value requests or changes made by review appraisers that you're familiar with? I got into the banking business 37 years ago and I can't think of one.

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Yes, I can. I know a guy who had his FHA certification pulled for a while and a guy who is under investigation for fraud for a couple of appraisals for a specific lender that was targeted. One of the files in question is a performing loan.

We discussed numerous times how we've had our comparable sales questioned by the new Collateral Underwriting program. I can think of three times recently where my comparable sales were challenged by realtors/lenders/borrowers. Once, I added several new comps and increased the value significantly. When I asked the builder for comps, they said they didn't have any. When the appraisal came in low, they asked me to reconsider my value and redo my work. I had asked for the data and the builder was lazy and didn't do their job. I changed the report because it was the right thing to do and I want my work to be right, even if it takes two times to get it right. Two other times I didn't change out the comps. One because they didn't challenge my work with closed sales. The other, the borrower wanted me to use sales that were on lots that were 5-7 times larger than the subject. I've taken the time to explain to people what they need to do if they feel my appraisal isn't fair, but they rarely can provide evidence that supports their position.

Reviewing reports, I have changed the values or redone the reports probably over half of the time. It turns into a major pain and the fee isn't worth the work, so I try to avoid review work. One that comes to mind, the original appraiser pulled comps from a superior section of the subdivision (gated and on acreage) and put the value on those comps and not the comps that were not gated and on much smaller lots.

I'm surprised you don't have the ability to get an appraiser off your panel if they are not turning in good work.

I don't know what good this does, but there are appraisers who are conscientious about their work.

I've been involved in numerous challenges to the value conclusion over the years. That's not uncommon.

I didn't say we don't try to remove appraisers who turn in poor work more often than they should.

Got a lot of football to watch today and golf to play tomorrow so y'all have a great weekend.

Surprisingly the only addition I will add is this. You cannot challenge an appraisal with your opinion. You cannot challenge your appraisers professional opinion. You have to find material defects in his/her logic/research. You can only argue facts. Find the holes in his work and call him out on it, i.e. room counts, gross square footage issues, bathroom counts, finish grade, major builder upgrades i.e. hard woods vs. laminate, outdoor living spaces,

I have found, once you find a crack that they cannot deny, additional correct value comes along.

When you appeal based on errors, poor choice of comps, etc you still have to appeal to the appraiser you feel is in error. That's a bad system.

That is where the AMC comes into play.

Deats which AMC are you getting real value appeals? I want to sign up.