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2017 Tech Insights
By Charles Warr, SVP of Business Information Services, Valuation Partners
These days, it’s hard to go even 24 hours without learning about some new technology that is designed to make our lives easier. We’re living in an on-demand, tech-driven era and everyone is out to develop the next big thing or an app that will revolutionize the way we do something.
The mortgage and housing industry is no different. Every day, we hear about some new software or platform designed to streamline some process and make things better for business or consumers.
Appraisal technology has come a particularly long way. But among the wealth of products and services being developed to help this sector run more smoothly, there are three main drivers that should be on every professional’s checklist when it comes to taking one’s business to the next level.
Appraiser Productivity
There’s no question that both appraisers and AMCs want more business. The more reports that appraisers complete, the more money they will make, generally. And AMCs need quality appraisals completed quickly to generate more lender business. Whichever side of the business you’re on, more is better. The problem on each side is time. It takes time for appraisers to drive from one location to the next—especially in rural areas—then return to an office to generate reports and handle revisions.
Fortunately, great progress has been made in mobile technology, which is undoubtedly the future of appraising. There are many mobile tools available for appraisers that increase efficiency and accuracy by providing real time access to data sources from the field. Device-agnostic, web-based platforms have also improved productivity. Whether working from a laptop, tablet or smart phone, appraisers can accept appraisal assignments and post status notes in real-time from any device at their convenience. If an appraiser is out in the field and a recent report needs to be adjusted, web-based appraisal forms enable the appraiser to make minor modifications and resubmit the report from their mobile device. In the past, appraisers would have to wait until they got back to their desk to make such corrections. Today, simple problems like typos or additional commentary can be fixed from anywhere.
An important part of mobile technology is for appraisers to be able to perform work online or offline no matter the device. An appraiser may occasionally be in an area without service, for example. Recent advancements now take care of this so that everything will synchronize once the appraiser can access the Internet. This makes things much easier for appraisers to move from one job to the next then pick up where they left off later.
As more and more companies put out mobile technology, there will be many tests done on software for application (app) technology versus those that have web-based technology, where a browser and some sort of Internet connection is needed. We’ll likely see that most will develop web-based forms then follow up with improved applications for phones and devices. Systems will be allowed to connect so the user can still access the web-based version regardless of the device, or load what is probably a more efficient app on their device.
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Better Access to Better Data
Productivity also increases with real-time integrated access to online data sources. Essentially, this gives appraisers all the data they need for their appraisal reports, such as comparable searches, historic records and other information that can be immediately pulled into the report. This alleviates the need to rekey some of this information, which saves time and reduces the risk of typos. Instant access to data sources and the validation of public records data have had an immeasurably positive effect on appraiser efficiency and appraisal quality.
Third party data can also be utilized to create hybrid valuation products, which is something we’ve done at Valuation Partners. In certain cases, we provide these products to clients for free as a companion piece to the appraisal. For example, appraisals on loans submitted to Fannie Mae and Freddie Mac are run through Collateral Underwriter (CU), which scores appraisals based on the GSEs’ UCDP data. When an appraisal results in a score of 4 or 5, we can leverage third-party data to create our Market$en$e reports, which can determine whether the report might require commentary by a quality control (QC) reviewer. This gives clients additional confidence about an unusual appraisal when they go to package their loans.
Data analytics enables appraisal vendors to view an appraiser’s ability to accept assignments and to submit assignments from a mobile platform, as well as make the automated review process as transparent as possible. Delivered through the right platform, such tools can provide immediate feedback to the appraiser based on a client’s specific requirements or UAD revisions and rules that might create trouble upon submission. These tools enable appraisers to amend reports at the time of submission, so they can hopefully sail through quality control and get delivered to the client immediately.
When there is a question of value in a report, an AMC can make available third-party data from courthouse records or listing data to the appraiser. An AMC should not necessarily provide a list of nearby sales, but appraisers could query this additional data on their own. It’s important to point out that a lot of push back can happen when it looks as though an AMC or a client is trying to steer an opinion of value. From our standpoint, we want to give the appraiser additional tools to use because when it’s helpful to them everyone benefits. However, it’s important that appraisers have access to the same tools and data being used internally by QC staff to ensure everyone is on the same page.
Something that can really ruffle an appraiser’s feathers is client requirements. The client, or lender, might have guidelines and assignments based on the loan program they are going through or internal underwriting requirements. These requirements should be provided in a concise form, specific to the client, with each appraisal order. Since it would be difficult to sift through multiple pages of requirements the client might ask for, adding that to an automated data rule set might be beneficial. If the client requires more than three comparable sales, for instance, this would be included in the automated rule set. Upon submission, if an appraiser overlooked a specific rule or requirement, this would fire an alert indicating what the client is looking for in their guidelines. In most cases, this will avoid a lot of post-delivery grief. Let’s face it, once a report is submitted, the hope is that it’s done and won’t have to be reopened. If this can be addressed at the time of submission instead of later, it’s better for everybody.
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Ongoing Push for Transparency
Today’s appraisal technology is moving toward a more collaborative environment, which is a win for everyone. In the past, most appraisers worked alone and were valued for their objective, carefully researched opinion of value. Today, however, there are many more compliance concerns and new rules with which to grapple. These dictate a more transparent and team-oriented approach between appraisers, AMCs and lenders—especially when it comes to meeting a lender’s requirements. For example, “appraiser independence” can still exist and be encouraged but everyone should have access to the same information, the same data and the same requirements. Not only should this information be easily shared among all parties, it must be easily understood as well.
Transparency truly happens when the appraiser sees what everyone else sees. There’s not one set of rules for an appraisal and a different set in QC. There might be a more detailed checklist for things that require manual viewing but the appraiser should have the same set of tools that an AMC’s customer service and QC teams use when going through the workflow process. Everyone is happier when true transparency occurs and rules are presented directly up front with additional information as part of scope of work for how to perform the assignment, including no surprises post-delivery. For complete clarity, all client requests should be presented to the appraiser with the order and then again at the time of submission. That level of transparency really avoids a lot of grief after the fact.
When all is said and done, the professional appraiser remains the cornerstone of a healthy valuation industry. You are the ones out in the field and your input is invaluable when deciding the right technology and platforms AMCs use in their operations. Appraisal productivity, data analytics and transparency are obviously the biggest drivers behind today’s appraisal technology. But it begins with AMCs asking appraisers what would help make their jobs easier and the looking for these features in the tools we use or develop; then ensuring everyone has access to them so everyone stays on the same page. Done right, the result will always be quicker, higher-quality appraisals and happier appraisers.
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About the Author
Charles Warr is Senior Vice President of Business Information Services with Valuation Partners, a subsidiary of The William Fall Group, a national provider of appraisals and valuation services and products for the real estate and mortgage industries. Warr is a 20-year veteran of the valuation industry, beginning his career as an appraiser and he still holds a certified residential appraiser license in Ohio. He can be reached at cwarr@williamfallgroup.com.
Send your story submission/idea to the Editor: isaac@orep.org
by Mike Ford, CA AG, AGA, GAA, RAA, Realtor(r)
From the article “If an appraiser is out in the field and a recent report needs to be adjusted, web-based appraisal forms enable the appraiser to make minor modifications and resubmit the report from their mobile device. In the past, appraisers would have to wait until they got back to their desk to make such corrections. Today, simple problems like typos or additional commentary can be fixed from anywhere.”
ANY appraiser that makes these kinds of corrections while out in the field without access to their work file is a damn fool!
Not all technology saves and appraiser ‘valuable time’-when compared to the value of their time defending themselves before state boards when some technology advocating speed is everything over quality and reliance pushes them into foolish mistakes. “Real Time”? Uh huh. Is there something so earth shaking & time sensitive that I need ‘real time’ technology and access to my unsafe and not secure ‘cloud based storage’ ?
There are reasons why certain companies have the reputations they have. I’d urge the rest of us to always exercise caution and USPAP compliance over the newest of the new fangled time saving, ‘can’t live without them’ gimmicks of the week.
-by Tom Horn
Charles, all of your points are well taken. I would like to add my take on the transparency angle you speak of. If all of the data that lenders have through the Collateral Underwriter (CU), especially the statistical data, was available to the appraiser it would help us to do our job a lot better. At the present time, this information is not available to the appraiser and it feels like it is being used as a “gotcha” type of thing where it is used after our appraisal is complete to try and catch us doing something wrong when you compare our reports to what the “Big Data” says. If the process was truly transparent this valuable data would be provided to us up front to help us provide a better product. Thanks for letting me give my two cents worth.
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