How to Handle Appraisal Pressure and Stay Ethical?

Excerpts: There’s no simple and easy way to deal with appraisal pressure. A major source of frustration for appraisers is the realization that clients do not have to follow USPAP. The ethical and performance requirements of USPAP apply only to appraisers, not to clients. In other words, USPAP doesn’t prohibit a mortgage broker from calling and asking you to develop an appraisal based on a predetermined value, but USPAP does prohibit you from accepting that assignment.

When you are faced with appraisal pressure, here are some strategies to manage the situation and still maintain your reputation as an ethical, unbiased appraiser.

1. Educate your appraisal clients

A lot of what appraisers consider pressure from clients is merely a result of the client’s lack of knowledge about appraisal standards and ethics. A lender might ask an appraiser to guarantee values beforehand simply because he or she is unaware that it is unethical for an appraiser to do so.

Avoid this by explaining why you cannot guarantee a value or remove that deferred maintenance photo from your report. You might be surprised at your client’s response if you take the time to educate him or her.

For 8 more reasons, click here

My comments: Appraiser Pressure – What To Do? Can you learn to be an ethical appraiser (or person)? Do you try to be ethical in whatever you are doing? Does it depend on who trained you? Or, do you learn from your parents when growing up? A Very controversial topic!

The Good Appraiser (for anyone who wants their number) Always gives us what we need: – Unethical Appraiser. The Bad Appraiser: A deal killer – Ethical Appraiser.

I was trained at an assessor’s office with no pressure to appraise high or low, fail to disclose defects, etc. I was very lucky. Fee appraisers are under lots of pressure. You learn that people are always looking for a value. for example, when doing an appraisal for a divorce, I always say, “If neither spouse likes my value, it must be okay.” For new clients, I make it very clear that I will not be unethical by giving them what they want upfront. I have lost many clients over the years because I was ethical.

Working with difficult appraisal clients

Appraisal Business Tips 

Humor for Appraisers

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To read more of this long blog post with many topics, click Read More Below!!

NOTE: Please scroll down to read the other topics in this long blog post on Real estate market changes, ADUs, AMC interview, unusual homes, mortgage origination stats, etc.


$4 Million Triangle House in Tarzana

Built in 1960, the main house and replica mini-me guesthouse has 4 bedrooms, 6 baths, 5,278 sq.ft., 1.35 Acre lot

Excerpt: “It’s probably one of the coolest properties I’ve ever seen,” says the listing agent Trisha Perez with Century 21 Everest. She and Gary Wolfe both hold the listing.

“It’s like you’re walking into art,” adds Perez.

She adds that the ingenious design creates the impression from the inside that you are at one with the natural world.

“You feel like you’re outside, because of the floor-to-ceiling windows and looking out to the huge trees and mountains.”

The home is part futuristic fantasy, part villain’s lair from a James Bond movie, and its jaw-dropping features start with one of the wildest gates we’ve ever seen

To read more and watch the 2-minute virtual tour. click here 

My comments: Often, real estate agent descriptions are a bit “over the top,” but this house’s description is not extravagant. ! Looks like nothing very special from the front view above. Check out the very unique front gate.


Where Will Housing Prices End 2022? New Data Predicts a 4% Drop in 5 Months and Homes with These Two Characteristics Will Be Hardest Hit

By Edward J. Pinto | Shawn Tully

Excerpts: In the Fortune article below Shawn Tully discusses the current housing market, focusing on the factors behind falling home prices with Ed Pinto, the Director of AEI’s Housing Center.

On August 22, the source that arguably features the best residential real estate data in the business, American Enterprise Institute’s Housing Center, released new numbers for July. The update’s overall theme: America has reached a pivot point where the market’s flipped from record appreciation this spring to substantial real-time declines across a number of the most overheated metros. 

The key revelation is that from August through the close of 2022, prices on a national level are tracking for the first substantial pullback in any six month period for well over a decade. To get the estimate, and it may shock you, read on.

The AEI’s July report spots three key trends. The first highlights the damage that’s suddenly engulfed the big, super-pricey western markets. For the U.S. as a whole, month over month Home Price Appreciation or HPA has decelerated sharply from an average of 2.1% from January to April, to just 0.2% in June, followed by a slight uptick to 0.5% in July. “The July increase may be seasonal,” says Ed Pinto, Housing Center’s director. “Many of the homes that go to contract in the peak spring selling season close around 45 to 60 days later in July.” It’s important to note that as recently as April, every one of the 60 markets the AEI measures posted an advance over March.

Trend one: The West’s affordability problem finally bites…

To read more, click here

My comments: Short and readable. Reprint of a Fortune interview. FYI, Ed Pinto is very data-driven. He used data twice to debunk the appraisal bias accusations. Ed has regular updates and analyses of appraisal waiver data also. I subscribe to his email updates. A Subscribe link is in the upper right of the link above. A review of what he does will be in the October monthly newsletter.


New in the September, 2022 Issue of Appraisal Today. Available Now!

  • How to get a FREE Google Business Profile. An Excellent way to get more appraisal business!
  • Fact vs. Fiction. Don’t let these four appraiser liability myths trip you up by Peter Christensen
  • Appraisals for estates and trusts – the most popular non-lender appraisals, Part 1
  • Estate/trust liability advice from Peter Christensen
  • How land contributes to value, by Jamie Owen

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ADUs and What’s In It for You?

by Richard Hagar, SRA

Excerpts: Acronyms on top of acronyms—just wait until you see Fannie Mae and Freddie Mac’s upcoming appraisal form regarding these initials.


Accessory Dwelling Unit (ADU), Dethatched Accessory Dwelling Unit (DADU), Mother-in-Law Apartment (MIL), plus a dozen other names and initials—no matter what you call them, they are becoming more commonplace and likely part of the future appraisal assignment. The new proposed “1004” form goes so far as to include a multi-line section with more than twenty questions devoted to describing, measuring, and valuing these accessory units, including a requirement for multiple interior and exterior photographs. And you won’t believe their impact on value and the size of adjustments.

Duplex or SFR with ADU?

The line between a duplex and an SFR with an ADU is blurry, and appraisers must understand the difference and complexity before quoting a fee. Fortunately, the difference is usually based on zoning (except in Seattle, Oregon, and California) which makes it critical for appraisers to research zoning definitions and determine the highest and best use of the land, as if vacant and the property as improved. Appraising a property with an ADU takes more time, is complex and likely precludes licensed appraisers from providing the appraisal (it needs to be completed by a certified appraiser). If there’s a chance your subject property has an ADU, expect to spend, at a minimum, 25% more time on the appraisal and always make sure to check its zoning and legality before you quote a fee.

To read more, click here

My comments: One of the best ADU articles I have read. ADUs seem to be popping up all over the country. I have known Richard Hagar for almost 30 years and have taken many of his classes, live and online. He is an excellent teacher. A link to his online class is at the bottom of the article above.


$99.5M Malibu Mansion

Excerpts: 4-bedroom, 5.5-bath mansion with a 7,450 sq.ft. home with 3.18-acres. Private path to the beach and endless sunrise-to-sunset ocean view.

Highlights include a tennis court with a viewing area, the pool and spa area with a cabana and fireplace, and a pergola and meditation pavilion.

To read more and see lots of photos, click here

My comments: Needs a pickleball court, or at least pickleball lines in the tennis court ;>


NAN’s Steve Sussman on the company’s growth strategy (Interview by HousingWire)

The company was the highest-ranking appraisal management company on the 2022 Inc 5000 

Excerpts: Nationwide Appraisal Network (NAN) was the top-ranking appraisal management company on the 2022 Inc 5000 list at No. 1427, with an average 451% in revenue growth from 2018 to 2021.

Nationwide Appraisal Network (NAN) was the top-ranking appraisal management company on the 2022 Inc 5000 list at No. 1427, with an average 451% in revenue growth from 2018 to 2021.

Quotes from the interview:

Over the last 24 months appraisal fees were really soaring to new heights and it would have been easy for us to dramatically increase our management fees, too. But we made a decision as a company to stick to our commitment to print our management fee at the top of every invoice. We wanted the lender and broker community to know we were never taking advantage of the market. So, whether an appraisal was $500 or $5,000, our management fee held steady. We didn’t squeeze every penny out of every order because we’re looking at it from a long view of establishing a meaningful relationship.

There were also other factors that went into our growth. One was not being afraid to raise our hands for the tough work. A lot of our initial growth in the last few years came from markets where many AMCs prefer not to work. In fact, our foot in the door with three of the top 10 lenders came in rural Texas. They all came looking to us and we embraced that opportunity. We thought, hey, if we can shine here, then we’re going to gain recognition and trust with the lender and broker community. And that’s exactly what happened: all three ultimately expanded our allocation to a national footprint after seeing what we could do in some of the really tough markets.

I always joke that on the popularity scale, AMCs probably land somewhere between a root canal and the U.S. Congress. And there’s good reason for that. Not every AMC has operated above board, and there’s a perception of AMCs that they’re not adding value to the equation.

When times are tough, you double down on your core principles, you make sure that you’re executing on every single order as though it is the most important order you ever going to see and remember just how much every loan matters right now. And just deliver absolute top-level service. And know that times are going to change — at some point we will be back to a boom cycle.

To read more, click here

My comments: Well written, understandable, and worth reading. See what one AMC says about their business, the present and future of appraising, technology, the future, bias and more topics. I wrote about the INC 5000 list in the August 19, 2022 weekly newsletter, including the highest ranked AMCs. To read the issue click here and scroll down the page.


HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample issue go to or send an email to . Or call 800-839-0227, MTW 7AM to noon, Pacific time.

My comments: Rates are going up. Some appraisers are very busy and others have little work. Varies widely around the country.


Mortgage applications decreased 3.7 percent from one week earlier

Mortgage applications decreased 3.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 26, 2022.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5 percent compared with the previous week. The Refinance Index decreased 8 percent from the previous week and was 83 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 4 percent compared with the previous week and was 23 percent lower than the same week one year ago.

“The 30-year fixed mortgage rate increased for the second week in a row to 5.80 percent, reaching its highest level since mid-July. Mortgage rates and Treasury yields rose last week as Federal Reserve officials indicated that short-term rates would stay higher for longer. Mortgage rates have been volatile over the past month, bouncing between 5.4 percent and 5.8 percent,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “In another sign that market volatility has picked up, the average rate on a jumbo loan was 5.32 percent, 48 basis points lower than for a conforming loan. This spread reached a high of over 50 basis points in July – and had narrowed – before now widening again.”

Added Kan, “Application volume dropped and remained at a multi-decade low last week, led by an 8 percent decline in refinance applications, which now make up only 30 percent of all applications. Purchase applications have declined in eight of the last nine weeks, as demand continues to shrink due to higher rates and a weaker economic outlook. However, rising inventories and slower home-price growth could potentially bring some buyers back into the market later this year.”

The refinance share of mortgage activity decreased to 30.3 percent of total applications from 31.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 8.5 percent of total applications.

The FHA share of total applications increased to 13.0 percent from 12.5 percent the week prior. The VA share of total applications decreased to 11.1 percent from 11.6 percent the week prior. The USDA share of total applications decreased to 0.6 percent from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.80 percent from 5.65 percent, with points increasing to 0.71 from0.68 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200)increased to 5.32 percent from 5.28 percent, with points decreasing to 0.48 from 0.58 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 5.57 percent from 5.43 percent, with points decreasing to 1.09 from 1.10 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 5.10 percent from 5.01 percent, with points decreasing to 0.82 from 0.84 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs decreased to 4.78 percent from 4.81 percent, with points decreasing to 0.61 from 0.74 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts. Base period and value for all indexes is March 16, 1990=100.

Ann O’Rourke, MAI, SRA, MBA
Appraiser and Publisher Appraisal Today
1826 Clement Ave. Suite 203 Alameda, CA 94501
Phone 510-865-8041

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