How to Fight Real Estate Agents’ Appraiser Blacklisting

How to Fight Real Estate Agents’ Appraiser Blacklisting

Excerpts: When a real estate agent “blacklists” an appraiser, the result is often that the agent’s lender/AMC contacts will stop using the appraiser completely (at the agent’s request), or occasionally, the lender will continue to use the appraiser but not assign the appraiser any of the transactions that that particular agent works on. In the case of the latter, sometimes the appraiser will be assigned an order only to have it canceled later that day once the real estate agent sees the appraiser on the order and calls the lender or mortgage broker to complain. I’ve talked to appraisers who have this happen several times a year with the same agent…

Having an order canceled and reassigned is sometimes the first and only indication to the appraiser that something fishy is going on, but some appraisers who abruptly stop receiving work from a client often don’t have to look far to figure out why. While “blacklisting” is sometimes more discreet, some appraisers actually have the real estate agent call them and tell them explicitly that they are going to actively prevent the appraiser from ever working on one of their transactions.

To read more, click here

My comments: Lender blacklisting has been around for decades. I remember when the blacklists were shared among lenders. Some appraisers said it was good to be on the blacklist of the not-so-ethical lenders.

Savvy AMCs (and lenders) often just don’t give the appraiser any more work. Putting an appraiser on a blacklist can be a big issue.

Good article with practical tips from Richard Hagar and the author.

Appraisal Business Tips 

Humor for Appraisers

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Complex Residential Properties for Appraisers

How to Identify a Residential Complex Property

Excerpts: A complex one-to-four family residential property is defined as a property that meets at least one of the following criteria:

  • The property to be appraised is atypical
  • The form of ownership is atypical
  • The market conditions are atypical

“Below we dig a little deeper into each type of complex property outlined above, providing detailed descriptions and examples of properties that would fall under each of the three categories.”

To read more, click here

My comments: This is the best explanation I have read about this issue. All appraisers encounter complex properties. You may or may not decide to accept the assignment. Always check the info you have on the property before accepting the assignment. Or, you find out after starting on the appraisal that it is more complex than you thought. I regularly turn down assignments because it will require more time, or I don’t want to “reinvent the wheel,” as I may never do another like it, etc.

Mortgage lending appraisals are very, very cyclical. When you are very busy, I recommend turning down these assignments to make more money. You will have lots of time during the slow period to accept these assignments.

In ancient history, before AMCs, I often did the tough ones for loyal clients as a favor. AMCs will go down the list, sometimes for days, trying to find an appraiser. One called me yesterday about a mixed-use property that their lender client said was residential. From online information, it looked like commercial on first floor. The issue was highest and best use, of course. I told them I did not know any commercial appraisers who work for AMCs, plus the fee would be over $2,000. You have to know that city’s local zoning regulations, requiring local expertise to determine the highest and best use.

The Bottom Line: Don’t Risk Your Appraisal License if it is too complicated for you!! I get many calls from appraisers having problems. This is always my answer. I have returned fees up to $2,000 after spending lots of hours on the assignment.

Appraisal Business Tips 

Humor for Appraisers

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Age adjustments in appraisals

Age adjustments in appraisals

By Jamie Owen

Excerpts: Sometimes, two homes with wide age differences can have the same effective age. For instance, a thirty-year old home may have an effective age that is the same as a fifty-year old home, if the fifty-year old home has been renovated to a degree that is comparable to the younger home. If this is the case, while there is a relatively wide age gap, no age or condition adjustment may be supportable.

Once the home is lived in, it can never be considered “new” again. Subsequently, a new home typically has a higher market value than one that has already been lived in. The joyful homeowner makes these choices, the home is built, and they move in. Now starts the wear and tear. The degree of wear and tear depends much on the homeowner and how well they maintain their home. With new homes, typically homeowners go for a number of years without needing to do anything major to the property. However, at some point, they will need to.

To read more and see some fun animated gifs and a video, click here

My comment: Written for homeowners (an excellent marketing tool) but interesting comments for appraisers. I love Jamie’s blog posts!!

Humor for Appraisers

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

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Homes with Major Structural Problems for Appraisers

Homes with structural problems for appraisers

Take a break and see some very strange things that can happen!!

Excerpt: For nearly 30 years, Alpha Structural, Inc. has developed a powerful reputation as the number one foundation engineering and repair, landslide repair, earthquake, and structural rehabilitation contractor in the Los Angeles area.

In this post, they share photos from its engineers’ day-to-day work, including all the funniest, most bizarre, and downright dangerous things they discover.

To check out the text, photos, very humorous comments, and leave your own comments, Click Here !!

My comments: I have appraised a lot of hillside homes and seen a lot of foundation damage, including strange ways people try to keep the damage from getting worse. One house was slowly moving down the hill. I appraised it as land value plus interim use as a rental (a very slow market at that time). Many thanks to long-time appraiser and friend (30+ years), John Regan, for this Most Excellent Link,!!Getting too many ad-only emails?

Appraisal Business Tips 

Humor for Appraisers

Covid-19 Residential Appraisers Tips on Staying Safe

 

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Why Comp Photos in Appraisals?

Why Comp Photos?

by Richard Hagar, SRA

Excerpt: First, don’t even think about not doing it! To begin with, it’s required. Inspecting the exterior of every comparable isn’t a USPAP requirement, by the way, it is a Fannie Mae, Freddie Mac, Federal Housing Authority (FHA), and Department of Veteran Affairs (VA) requirement.

However, FNMA’s requirement goes directly to the heart of USPAP’s “scope of work” rule. USPAP defines scope of work, in part, as: the type and extent of research and analyses. The scope of work section of the 1004 appraisal states “The appraiser must, at a minimum: (3) inspect each of the comparables sales from at least the street.” So, when an appraiser agrees to an assignment and its required scope of work, they have agreed to personally inspect the exterior of each sales comparable used in the appraisal. There is no way around this; an appraiser can’t contradict the certification requirement by inserting a qualification within the appraisal. In other words, it’s your job; you are being paid to personally inspect each sales comparable—so do it!

To read more, click here

My comments: Last week’s newsletter had a very popular negative post on comp photos: Original Comp Photos: Dangerous, Unnecessary. This week is the other side!! I know what it is like to drive many miles to take an original comp photo that I somehow forgot to take. But, I am more comfortable if I take another comp photo again as I forget about the details sometimes. I have used MLS photos when I cannot see the comp from the street.

Hagar discusses the many aspects of original comp photos, including the limiting conditions on the Fannie forms. In my opinion, the statement is somewhat uncertain. “…inspect each of the comparables sales from at least the street”. Does this mean original photos and always driving by? I do not have this statement in my non-lender appraisals, plus many other Fannie statements. However, many lenders and AMCs have this in their requirements.

On the other side, I used to travel to Canada to speak at appraisal conferences. At that time, taking original comp photos was not required for lending purposes. Few appraisers did them. They said they had “seen it in the past”.

Appraisal Business Tips 

Humor for Appraisers

Covid-19 Residential Appraisers Tips on Staying Safe

For Covid Updates, go to my Covid Science blog at covidscienceblog.com

Click here to subscribe to our FREE weekly appraiser email newsletter and get the latest appraisal news!!

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 USPAP, comp photos, adjustments, Bias, mortgage origination stats, Covid tips for appraisers, etc.

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