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Working RE has hosted a number of webinars designed to help appraisers protect themselves from influence and maintain appraiser independence.
–How to Limit Liability, Maintain Appraiser Independence, and Fight Influence
–Appraiser Review and the Law
–Surviving AMCs: Get Paid and Protect Yourself
Editor’s Note: With over 1,000 appraisers participating, the results of this new survey shed some light on the state of appraiser independence in the last quarter of 2013.
Appraiser Independence Survey Results
by David Brauner, Editor
We hear a lot of appraisers complain that illegal influence and violations of appraiser independence continue today despite new federal and state regulations designed to remove it from the process. This survey hopes to shine light on what some of you are experiencing. The results of the Appraiser Independence Survey are mixed.
Over 1,000 appraisers participated in the survey; over 300 left additional comments to illustrate their points. The survey remains open if you’d like to participate. (To participate, visit the new WorkingRE.com and click Blogs/Surveys; Surveys; Appraiser Independence Survey.)
You will find the questions below, along with the responses by percentage (rounded). You can find the comments at WorkingRE.com, click Blogs/Surveys; Surveys; Appraiser Independence Comments. Many are thought-provoking and troubling. The following are representative of many.
“I have never been removed from a panel but I certainly see a decrease in business as soon as I am under the sales price. This happens with both appraiser management companies (AMCs) and lenders. There is never an explanation, just a sharp reduction in orders.”
“Pressure and undue influence are alive and well. Nothing has changed with all the additional regulation except the pressure is more subtle. Now it’s called ‘Reconsideration of Value.’ No one respects or appreciates the appraiser’s professional independent opinion. Everyone has an opinion and thinks they know the value, including the Realtors, loan officers, mortgage brokers and homeowners.”
“Our firm of 11 appraisers lost two very large clients due to pressure from loan officers and Realtors. It was more important to make the loan than to have a credible appraisal. On one we complained through the Consumer Financial Protection Bureau and the FDIC and heard from no one.”
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Survey Questions
The percent number represents how appraisers answered (rounded).
1. Since HVCC was implemented (5/09), Your “Appraiser Independence” has:
A. Increased 27%
B. Decreased 33%
C. Remained about the Same 40%
2. How often do you feel there is an attempt to influence your value conclusion?
A. Never 22%
B. Infrequently 22%
C. Occasionally 36%
D. Fairly Often 14%
E. Regularly 6%
3. Within the last year, you believe you were “dropped” from an AMC/Lender roster or lost work for not meeting conditions/requests that you felt were contrary to an accurate appraisal:
a. Never 23%
b. Infrequently 18%
c. Occasionally 32%
d. Fairly Often 16%
e. Regularly 11%
Quick Analysis
The response to question one shows that (only) 27% of appraisers who answered the survey feel more appraiser independence since HVCC (73% don’t). Question two shows that nearly 56% of appraisers feel an attempt to influence their value conclusion occasionally, fairly often or regularly; with only 44% saying this occurs infrequently or never. As per question three, 59% of respondents believe that- occasionally, fairly often, or regularly, they were “dropped” from an AMC/Lender roster or have lost work for not meeting conditions/requests that they felt were contrary to an accurate appraisal. Only 41% say this happens infrequently or never.
According to those contributing to this appraiser independence survey, appraisers haven’t made it to the Promised Land of independence quite yet. (To take the survey, visit WorkingRE.com and click Blogs/Surveys; Surveys, Appraiser Independence. )
by Adrienne Wagner
A problem occurring here in Colorado is that the realtors have a new weapon against appraisers who “don’t appraise properties high enough” to close their deals – threaten the appraiser with a complaint at the State Board against their license. This happened to me and I have heard other appraisers say they, too, are being threatened with this. The bigger issue is that Director Marcia Waters, who is not an appraiser, believes that this is “not intimidation” and that appraisers are not appraising properties “high enough”. She is only too glad to “investigate” any appraiser for this type of complaint and totally ignore the reality that this is an act of undue pressure, intimidation and retaliation. I filed a complaint with against the realtor involved, with the Colorado Real Estate Commission, only to be told by the investigator for the Commission “I did not even read your complaint and I am dismissing this. Appraisers are NOT allowed to file complaints against realtors – we just can’t have that.” This is a huge bone of contention at this point. One of my many thoughts on the matter is – if a licensee, either appraiser or realtor, files a complaint against another licensee, then both licensees files need to be pulled and investigated by a non-partial panel of both appraisers and realtors in order to resolve the issues. I would not be surprised to find that this is occurring in other states, as well, but for some reason, no one wants to talk about it. Thanks for letting me voice my concerns here.
-by JOSEPH FASSARI
I think we nned to be informed about insurance. Especially about regulatory exclusions. While I have not noticed the addendums shown from other policies my current policy has me concerned:
J. Based on or arising out of any actual or alleged violation of:
1. The Employee Retirement Income Security Act of 1974;
2. The Securities Act of 1933;
3. The Securities Exchange Act of 1934; or
4. Any state Blue Sky or Securities law;
Or any rules, regulations or amendments issued in relation to such acts, or similar state or federal
statutes or regulations, including any claim based upon common law principles of liability;
I or us need what we can do to protect ourselves. I am not or have any knowledge of any claims against me. I have always used proper judgement. This does not mean my appraisals are perfect. I do know FDIC is on a witch hunt.
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