CFPB Crackdown: Unfair Practices Hurting Consumers

This includes Appraisal payments to appraisers by AMCs

by Josh Tucker, June 5, 2024

Comments must be received on or before August 2, 2024

Excerpts: As we all know many AMCs are not paying Customary & Reasonable fee as required by TILA. They have consistently pushed down the pay of Appraisers while making undisclosed profit off consumers and prioritizing cheapest and fastest over quality and competency. The CFPB has been in communication with individuals behind the scenes and are concerned with what has been shown enough to include AMCs in their data collection process.

Now is the time to send them everything we have. To drive legitimate change, we must encourage as many appraisers as possible to submit all relevant information to the contact details provided below.



Request for Information Regarding Fees Imposed in Residential Mortgage Transactions AGENCY: Consumer Financial Protection Bureau.

ADDRESSES: You may submit comments identified by Docket No. CFPB-2024-0021, by any of the following methods:

Federal eRulemaking Portal: . Follow the instructions for submitting comments. NOTE: THE SEARCH WAS NOT WORKING ON JUNE 6. MAY WORK LATER. CAN USE EMAIL.

Email: Include Docket No. CFPB-2024-0021 in the subject line of the message.

Mail / Hand Delivery / Courier: Comment Intake —Residential Mortgage Fees Assessment, Consumer Financial Protection Bureau, 1700 G Street NW, Washington, DC 20552.

To read more, Click Here

My comments: DO SOMETHING. YOUR VOICE MATTERS. Let CFPB know about the amount of AMC fees for appraisers, plus other problems. In my opinion, AMCs are ruining residential lender appraising. I have never worked for an AMC, but I’ve been appraising for almost 50 years and understand the problems.


Appraisal Fees & Value: Lessons from Picasso & Steinmetz

By “Apex Appraiser” June 3, 2024

The Appraisal Institute has been a source of frustration and criticism within the appraisal profession for quite some time. I must admit that I have also expressed my dissatisfaction with them. Nevertheless, I must acknowledge that the new CEO, Cindy Chance, appears to be a positive change and is making some valuable points about our profession from her new position. In particular, she recently discussed appraisal fees in a piece she wrote.

In this excerpt, she shares two stories that provide valuable insights. These stories, one involving art and the other science, highlight the fact that appraising is a combination of both.

First is the story about a young woman who encountered Pablo Picasso one spring day, in a park, sketching. She begged him to sketch her. He graciously agreed, and following a few moments of study and drawing, handed her a sketch of herself. When she asked what she owed him, Picasso answered “$5,000 madam.” “But it only took you five minutes.” “No, madam, it took me my whole life.”

To read more, plus many appraiser comments, Click Here

My comments: Worth reading, plus the appraisers comments. I have been following CEO Cyndi Chance since she started working for AI. It’s definitely a “breath of fresh air” for the AI!



Appraisers Riding the Waves of Up and Down Mortgage Rates

Appraisal Business Tips 

Humor for Appraisers

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NOTE: Please scroll down to read the other topics in this long blog post on state appraisal boards, liability, appraiser insurance, price per sq.ft. up 50%, sea level rise, unusual homes, mortgage origination stats, etc


Rogers Island, Branford, CT Price: $35,000,000

Excerpts: 10 bedrooms, 6.5+ baths, 8,74t sq.ft., 7.54 acres, built in 1902

Private island: When it sold in 2018 for $21.5 million, Rogers Island made a splash as one of the largest sales in the state at the time.

In the six years since, the main residence has been renovated and now features upgraded amenities. The 7.6-acre property also offers a four-bedroom guesthouse, tennis courts, three private beaches, two docks, a putting green, and an in-ground pool overlooking Long Island Sound. Formal gardens, meandering trails, & a koi pond. Plus artist studio and tennis court.

Property also has a four bedroom waterfront guest house.

To read the Listing with 35 photos, Click Here


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Do I really have to report that state board issue to my E&O insurance? By Peter Christensen, Esq.


Appraiser fears about reporting

Whatever the reason for having E&O, when a state disciplinary matter

occurs, appraisers understandably worry about the impact that the disciplinary matter may have on their insurance. Common fears are that their insurer will not renew their policy or that the insurer will increase their premium.

These fears do have a rational basis but they are sometimes excessive. The imposition of serious discipline against an appraiser – such as a license suspension based on serious violations of USPAP or intentional wrongdoing – almost certainly will result in an insurer’s decision to not renew the appraiser’s policy or a substantial rate increase.

The second reason for reporting – renewal applications require disclosure

The other reason to report a complaint to your E&O provider is critical.

Virtually all applications for new E&O or for renewal of E&O have variations

of two questions. One question addresses the existence of past or pending

disciplinary investigations and asks something like this: “Have you been

disciplined or investigated by any state licensing, administrative or regulatory

board as a result of appraisal activities?”


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Appraiser Insurance: The Three Policies You Need for Your Business

Excerpts: As a business owner, having insurance is critical to protect you and cover the risks you face in the profession. Help you feel more confident that you have the right coverage, we’re going over the types of appraiser insurance you need and why you need it.

Errors and omissions insurance
General liability insurance

Commercial property insurance

Why is general liability insurance important?

Without general liability insurance an appraisal company may be responsible for paying large out-of-pocket expenses for things like: Legal fees, Compensation to injured parties

Reputational harm, Property damage repairs

Commercial property insurance

This type of appraisal insurance keeps the physical aspects of your company safe. If you have an office (yes, a home office is included in this), commercial property insurance will keep you from being financially liable to damage to the property.

Why is commercial property insurance important?

Life happens, right? When the unexpected happens at your office, the last thing you want to deal with is paying out of pocket. Commercial property insurance covers the cost when it comes to: Fire/Explosion, Vandalism, Storm damage, etc.

To read more, Click Here

My comments: I have always had the three types of insurance listed above. I always use an appraiser E&O broker, but I use my general insurance agent for the other two above, plus my rental property. Some E&O companies may also cover these types of insurance.

The June issue of Appraisal Today is my annual E&O issue, which includes lots of information, liability tips, and information on where to get insurance.


The Price per Square Foot of an Average U.S. Home Has Jumped More Than 50% Since 2019

Excerpts: home’s price per square foot is a somewhat overlooked real estate feature. When shopping for a house, buyers are usually focused on the total size, list price, and location.

But price per square foot is a crucial metric, and it’s now grabbing some rare attention: The latest monthly housing report from® reveals that the typical listed price per square foot grew by a whopping 52.7% from May 2019 to May 2024.

In contrast, the typical listed home price increased by 37.5% over the same period to its current nationwide median of $442,500.

“The price-per-square-foot metric is an important one to pay attention to,” says senior economist Ralph McLaughlin. “The change in that metric is a more solid measure of how much more a home is worth over time than looking at changes in median list price.”

“The median list price can fluctuate even if the market is stable,” McLaughlin explains. “For instance, an increased share of smaller homes on the market could lower the median list price without affecting the overall value of homes.”

“Price per square foot can really be deceiving,” explains Cara Ameer, a bicoastal agent with Coldwell Banker licensed in California and Florida. “A smaller home can have a higher price per square foot versus a larger one, and that can skew the numbers.”

So rather than focus only on price or price per square foot, Ameer recommends using comparables, or “comps,” to provide a more complete idea of a home’s value. This takes into account the home’s condition, upgrades, location, lot size, and other features to make a more informed decision.

To read more, Click Here

My comments: Although appraisers don’t like to use price per sq. ft, if

only because it does not consider land values, it can be an indicator of the overall “big picture” of a larger market. The Ultimate Water View?


Underwater Lot in Alameda (San Francisco Bay Area) Surfaces on the Market for $400K

Listing agent comments:

The listing is quite upfront about the splashy property: “This is a water lot,” it states, adding that the parcel is “an investor’s/developer’s opportunity where location, location is everything.”

However, building in a water lot has its own special set of challenges.

The perfect buyer “is someone who is not afraid of the challenge of being creative,” says listing agent April Jones, with April Jones, Broker.

Interested parties would need approval from the following agencies: City of Alameda, Army Corp of Engineers, Water Board, Public Works and Bay Conservation and Development Commission

To read the listing agent comments (worth reading – finding the listing location, etc.), Click Here.

To read the complete listing and see the aerial photo of the lot with the location indicated, click here

My comments: Many thanks to reader Joe Lynch for telling me about this. The info was first published in a small San Francisco newspaper.

I have lived in Alameda since 1980. In the 1950s, this part of the western waterfront on Alameda Island was developed, including lagoons, apartments, and a shopping center called South Shore.

They made the lagoons from the rear part of the land from the Gold Coast Homes (classic homes, very expensive). The homes were on the bay waterfront. I wonder if the land taken was below and/or above the bay water level. I have appraised many of the homes on the Gold Coast, both on and off the lagoons. I never knew about any lots underwater.

For many years, I have known that there are lots under San Francisco Bay waters in other parts of the Bay that are privately owned. Google “Where can you buy lots underwater in San Francisco Bay?” There are lots of them! San Francisco Bay is very large.

I have no idea what could be done with this lot. Challenging appraisal assignment!

Underwater properties , vacant and improved, will increase due to sea level rises all over the world, including identified low lying areas next to San Francisco Bay. Across the street from my office, a former marina is being redeveloped into housing. The developer had to add 2 ft. of soil because of sea level rise risks. Ground bay water level has always been high here. There are no cemeteries. FEMA mapped the west coast risks a while ago.


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, Click Here.

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 go to Or call 510-865-8041, MTW, 7 AM to noon, Pacific time.

My comments: Rates are going up and down. Many appraisers are not busy. Some are busy, usually with non-lender appraisals.

Mortgage applications decreased 5.2 percent from one week earlier

WASHINGTON, D.C. (June 5, 2024) — Mortgage applications decreased 5.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Applications Survey for the week ending May 31, 2024. This week’s results include an adjustment for the Memorial Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 5.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 16 percent compared with the previous week. The Refinance Index decreased 7 percent from the previous week and was 5 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 4 percent from one week earlier. The unadjusted Purchase Index decreased 16 percent compared with the previous week and was 13 percent lower than the same week one year ago.

“Mortgage rates moved slightly higher last week, with the 30-year conforming rate reaching 7.07 percent – its highest level since early May – despite incoming data indicating somewhat slower economic growth,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “After adjusting for the Memorial Day holiday, both purchase and refinance application volumes were down, with purchase activity specifically 13 percent below last year’s level.”

Added Fratantoni, “Government purchase volume was down less, helped by growth in VA applications. The market is relying on first-time homebuyer demand, and many first-time buyers do use government lending programs.”

The refinance share of mortgage activity decreased to 31.1 percent of total applications from 31.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.7 percent of total applications.

The FHA share of total applications increased to 13.2 percent from 12.7 percent the week prior. The VA share of total applications increased to 12.1 percent from 12.0 percent the week prior. The USDA share of total applications decreased to 0.3 percent from 0.4 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) increased to 7.07 percent from 7.05 percent, with points increasing to 0.65 from 0.63 (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 $766,550) decreased to 7.21 percent from 7.22 percent, with points decreasing to 0.41 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.87 percent from 6.85 percent, with points increasing to 0.96 from 0.95 (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 6.75 percent from 6.66 percent, with points decreasing to 0.63 from 0.69 (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 6.37 percent from 6.64 percent, with points decreasing to 0.63 from 0.77 (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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