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Statute of limitations for appraisals
Why You Should Keep Your Workfile for 7 to 8 Years
By Peter Christensen, Liability Insurance Administrators, www.liability.com

Excerpt:

In 2013, many lawsuits against both residential and commercial appraisers continue to relate to appraisals performed years ago at the peak of the real estate price bubble, 2005 to mid-2008. These lawsuits are filed by borrowers, lenders, investors or the FDIC and typically allege that an appraiser’s inflated value resulted in the plaintiff borrowing, paying or loaning too much money.  The plaintiff blames its loss on the appraiser and sues for damages.

When reporting a claim like this to our office, one of the most common questions a defendant appraiser will ask us is about the applicable statute of limitations. The question is usually something like: “I did the appraisal in 2005, more than five years ago. I threw out the workfile because USPAP only requires me to keep files for five years. Won’t the lawsuit be dismissed based on the statute of limitations?” The answer to that question is almost always “probably not.”

The purpose of this Claim Alert is to clear up misconceptions that appraisers read and hear regarding statutes of limitations and to advise appraisers about the importance of retaining workfiles well beyond USPAP’s bare minimum recordkeeping requirement.  A good workfile is the appraiser’s defense tool kit when a claim comes in.  Without that workfile in hand, the appraiser’s defense counsel will usually be hampered in his or her ability to defend a claim.  Our advice on this issue is simple: keep your workfile for seven to eight years (unless a longer period is required under USPAP’s special requirement for assignments where the appraiser has provided testimony).  The discussion that follows should help you understand why.

My comment: Worth reading. You can be sued at any time, for anything, by anybody. Be careful out there. Have I always kept my files for over 5 years? No. Three years ago I significantly downsized my office at got rid of a lot of appraisal files  over 5 years old. Mistake!!!

http://www.liability.com/claim_alerts/statute-of-limitations-for-a-claim-against-an-appraiser.aspx

Revisiting The Green Hornet
By George Opelka, ACI

Excerpts:

Introducing Form #17-PRA

In the late 1950s, my Dad (Gregory Opelka) taught real estate appraisal courses in the evenings at the Savings and Loan Institute in downtown Chicago. Through his teaching ventures, he was invited to serve as an appraisal consultant to the U.S. League of Savings and Loan Associations. Additionally, he wrote a monthly appraisal column for publication in the Savings and Loan News, a trade magazine-a division of the U.S. League. As a result of an early consulting-writing assignment with the U.S. League, my Dad created appraisal form “#17-PRA” in 1962.

The appraisal report form was presented to the Appraisal Committee of the U.S. League for review and consideration for adoption and use by savings and loan associations across the United States. The form was initially presented on green paper with green ink strictly for marketing spin. The form was approved for nationwide members’ use by the U.S. League’s Appraisal Committee and was numbered form #17-PRA, Professional Residential Appraisal by the U.S. League staff. Form #17-PRA was then printed and sold by the Accounting Division of the U.S. League. Remember, this occurred in 1962 (pre-ACI), so the completion of this form was intended to be a handwritten field report, and submitted accordingly.

It wasn’t until after the form was released and in production when the appraisal staff of the First Federal Savings and Loan Association of Indianapolis submitted a report critiquing the new form. This critique was published in a monthly professional trade magazine of the Society of Residential Appraisers. Of historical note, it was this local Indianapolis S&L appraisal committee that affectionately dubbed the new form “The Green Hornet”! Ironically, the name stuck and even today, almost fifty years later, the Green Hornet continues to charm and identify with the residential appraisal process.

The URAR ERA

In 1984, twenty-two years after the birth of the Green Hornet, a new initiative to create a standard appraisal form was spearheaded by the Society of Real Estate Appraisers. A committee was formed out of this initiative, wherein the Society of Real Estate Appraisers appointed F. Gregory Opelka, MAI, SREA, SRA, as Chairman of a new Uniform Appraisal Form committee. He was directed by the SREA to select and work with appraisal representatives from the Appraisal Institute and several various government agencies. Howard Sears, acting President of the SREA called for the development of a new common form. Aside from the SREA, the Institute, Fannie Mae, Freddie Mac, FHA and the VA, there were a few other government agencies, and all were actively involved in the development of this new form.

The advent of the personal computer provided better tools to develop the successor to the Green Hornet-an appraisal form using spreadsheet-like software. Initially, my Dad designed the new form in Visi-Calc and then shifted to developing it in Lotus 1-2-3.

My comment: I wonder what would have happened if a standard lending form was never developed? I remember when every relocation company had a different form. What a hassle!! I don’t even want to think about what if every lender had a different form….

http://appraisalbuzz.com/buzz/features/revisiting-the-green-hornet