Desktop appraisals – Lots of Info Available!

By on March 25, 2022   /   bias, desktop appraisals, Fannie, FHA   /   Leave a comment
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Desktop appraisals – Lots of Info Available
Fannie and Freddie started using Desktops on March 19, 2022

Both a floor plan and a building sketch with dimensions and GLA calculations are required. ANSI is not required.

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March 2022 Fannie Mae Appraiser Update: 

Link to March Appraiser Update, click here:

Link to “About Desktop Appraisals” PDF with 5 pages of information, click here Watch the Noble Appraiser explore the benefits of performing desktop appraisals:
The Desktop Appraisal Discovery Link to Noble Appraiser on desktops video, click here 

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McKissock: Fannie Mae and Freddie Mac Desktop Appraisals: Your Questions Answered

Excerpts: In January 2022, Fannie Mae and Freddie Mac announced a desktop appraisal option that goes live in mid-March 2022. In various articles and opinion pieces, some claim that desktop appraisals will solve the appraiser shortage and modernize the appraisal process, while others claim that they will cause the demise of the appraisal profession.

Here are a few of the 16 questions answered

  • What is a desktop appraisal?
  • Does USPAP require me to complete an inspection?
  • What data sources are used for identifying the subject’s relevant characteristics?
  • Are there any state restrictions?
  • Must I be competent in the subject’s market area?
  • Are extraordinary assumptions allowed?
  • Does the limited scope of work mitigate my liability?
  • Won’t these types of valuations be risky for the lender

To read more, click here

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Bradford Software Webinar Floor Plans for Desktops – Discover Your Options with 7 Floor Plan Providers March 24, 2022 (1 hour, 34 minutes), with comments from Scott Reuter of Freddie Mac.

It was recorded and is available at https://vimeo.com/692030955

I did not have time to watch it yesterday.

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My comments on the above resources: What’s the best resource(s) for you?

Noble appraiser video is short (3 min. 34 seconds) understandable and very informative. Fannie Mae is “the source” for desktops. McKissock’s Q and A post is well written, understandable with short answers.

Bradford’s video has demos of 7 app providers for floor plans and sketches.

If lenders will use them much is very uncertain. The Covid desktops were never widely adopted. No one knows now which cell phone apps will be used, who will use them, and their accuracy (tested by an independent company). Minimum of an IPhone 12 Pro, with LIDAR camera. Appraisers who have tested them say the floor plans are good, but sketches with dimensions and floor plans may not be accurate on complicated home designs.

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Fannie’s New Desktop Appraisal FAQs

By on March 11, 2022   /   ANSI, appraisal how to, bias, Clubhouse, desktop appraisals, Fannie   /   Leave a comment
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Fannie’s New Desktop FAQs

Timeline and 19 FAQs From an email received 3-8-22
“Desktop appraisals will be offered in Desktop Underwriter® (DU®) for eligible transactions starting March 19. Are you ready?
We’ve updated the About desktop appraisals fact sheet with an expanded frequently asked questions section.
Thanks to all the appraisers, AMCs, and lenders who submitted questions, and please continue to Contact us with your appraisal related comments and questions.”
To read the FAQs, click here
My comment: Reading the original Fannie document is good, such as a timeline list, additional verifications, inspections, CU, etc.
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McKissock has an excellent blog post answering many practical questions, including some in the Fannie FAQs and many other questions.
Topics include:
  • What data sources are used for identifying the subject’s relevant characteristics?
  • Are there any state restrictions?
  • Must I be competent in the subject’s market area?
  • Are extraordinary assumptions allowed?
  • Does the limited scope of work mitigate my liability?
  • What is the difference between a sketch and a floor plan?
  • How do I get a floor plan?
  • Does the floor plan need to be verified?
  • Does the property need to be measured per ANSI measurement standards per Fannie Mae’s requirements?
To read more, click here
My comment: Read both the Fannie FAQs and McKissock blog post. How often will desktops be used? It will take a while before they may be widely adopted. See last week’s newsletter. When are we going to get some ANSI FAQs????

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Fannie Wants Desktop Appraisals with Floor Plans

By on March 4, 2022   /   ANSI, AVMS, bias, Clubhouse, desktop appraisals, Fannie   /   Leave a comment
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Fannie Mae and Freddie Mac to launch remote desktop appraisals in 2022

Desktop appraisals with floor plans

Excerpt:
Beginning March 19, 2022, Fannie Mae and Freddie Mac will accept remote desktop appraisals nationwide on eligible transactions without the appraiser ever stepping foot on the subject property, the Federal Housing Finance Agency (FHFA) announced.
To read more, click here
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Link to FHFA announcement 10/18/21 with more information,click here
My comments: When they submit loan applications, lenders receive a list of appraisal types available for their loans, including waivers. Lenders did not widely choose the desktop Covid appraisals. They preferred full appraisals.
I ran an ad for Cubicasa (floor plan app) on Tuesday this week and got some appraiser complaints. I will be testing it soon and hopefully will be able to use it in my appraisals.
Many anticipate that lender adoption will be slow, including Lyle Radke from Fannie and a group email posting from an appraiser who recently attended a state Mortgage Bankers’ meeting. He said:
“I was on a 4 appraiser panel with +/-60 LO’s representing 20 different lenders. I asked for a show of hands-on how many would be offering Desktop or Hybrid appraisals on March 19… There was not a single hand raised. “
“When we discussed the Desktop and Hybrids, most had no idea about the differences in the two products… All 4 of us thought that the turn time “might” be reduced by 1-2 business days. So, based on a small sample, this may not be as much of a problem as some appraisers think. “

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Fannie Wants Desktop Appraisals

By on February 18, 2022   /   ANSI, Appraisal Foundation, bias, desktop appraisals   /   Leave a comment

Desktop Appraisal to Become the New Norm

by Isaac Peck, Editor

Excerpts: Sketch vs. Floor Plan

One notable requirement that is expected of the Desktop assignments is that they will require a floor plan instead of just a sketch. A floor plan takes the sketch a step further by including interior walls and room labeling, in most cases.

The obvious question is how are appraisers going to get these floor plans?

…the requirement for a floor plan in the desktop appraisal strongly suggests that appraisers will be required to work with real estate agents and/or the home seller and have them use a third-party tool to walk through the house, take pictures, and use advanced mobile app to generate a floor plan based on the agent or seller walking through the house.

… There is also the question of whether the introduction of desktop appraisals will potentially lead to a broader range of alternative appraisal products into the mix. Given that some senior executives at Fannie Mae were predicting that hybrid appraisals would become mainstream by 2022, it is actually a little surprising that desktop appraisal assignments are the first alternative product to get a permanent place on the GSE’s valuation roster. Appraisers will just have to wait to see what the future holds!

To read more, click here

My comments: Who will do the floor plans? They take much time for appraisers to measure and use appraisal sketching software. Many years ago, Fannie required them for a year or so, but quit due to appraiser complaints. I still do rough sketches for myself, so I don’t miss a bathroom or small bedroom!

Fannie met with Cubicasa and Inside Maps, who agreed to make their software conform to ANSI. Cubicasa is $34.90 per use. I have no idea how a homeowner will be expected to have an expensive smartphone (iPhone 12 Pro +) and learn how to use this software. In my market, many real estate agents are having these done or doing it themselves.

Some AMCs are recruiting appraisers to do these desktops with someone else using the floor plan apps. I don’t think many fee appraisers will want to hassle with finding someone to do them and pay for using the app.

 

Desktop appraisals okay for some Fannie Loans March 2022

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Desktop appraisals okay for some Fannie Loans March 2022

By on January 21, 2022   /   ANSI, appraisal business, appraisal forms, appraisal how to, bias, desktop appraisals, Fannie, liability, square footage   /   Leave a comment
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Desktop appraisals okay for some Fannie Loans March 2022

Fannie announcement – About Desktop Appraisals

Beginning in March 2022, desktop appraisals will be an option for some loan transactions. This fact sheet provides high-level information on Fannie Mae’s requirements for desktop appraisals and answers some frequently asked questions. We’ll be adding information to the fact sheet, such as additional FAQs as needed.

Excerpts:

  • Use Form 1004 Desktop
  • Must include floor plan with interior walls.
  • The appraiser must have sufficient information to develop a credible report.

To read the fact sheet, click here

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Desktop Appraisal to Become the New Norm

by Isaac Peck, Editor, WorkingRe

Note: This article was written before the Fannie announcement above. 

Excerpts: A number of questions remain regarding how the GSEs will establish the eligibility criteria for what types of loans, transactions, and loan-to-value (LTV) ratios will qualify for these desktop valuations. For example, Thompson’s comments that such a move will provide relief on rural appraisals runs contrary to most conventional appraisal experience in the industry where appraisal waivers, hybrid appraisals, and other “alternative” valuation products have primarily been used in cookie-cutter, tract home neighborhoods where model-match comps are more readily available.

In fact, over the years many senior executives at the GSEs and at major lending institutions have acknowledged the need for traditional appraisals on rural properties—which are much more likely to have unique features and require more complex analysis.

There is also the question of whether the introduction of desktop appraisals will potentially lead to a broader range of alternative appraisal products into the mix. Given that some senior executives at Fannie Mae were predicting that hybrid appraisals would become mainstream by 2022, it is actually a little surprising that desktop appraisal assignments are the first alternative product to get a permanent place on the GSE’s valuation roster. Appraisers will just have to wait to see what the future holds!

To read more, click here

My comment: Interesting and worth reading about the background of Fannie’s change

Appraisal Completion Certifications – be careful

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What is most often overlooked by appraisers?

By on June 5, 2020   /   adjustments, appraisal business, Appraisal fees, bifurcated appraisals, commercial appraisal, Coronavirus, desktop appraisals, Fannie, fees, lender appraisals, Mortgage applications, unusual home, USPAP, weird homes   /   Leave a comment
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Excerpt: We recently asked our appraisal community, “What’s the ONE thing that is most often overlooked by appraisers?” We received a wide variety of answers ranging from big-picture oversights to specific details. The most common answer we received was “Highest and Best Use.”…

Highest and Best Use (HBU)

This was the top answer, which was written in by about 8% of survey respondents “First question when doing an appraisal is the highest and best use. If there are two very different opinions of value on a property, different HBU is often the reason.”…

Obsolescence

Obsolescence is another item mentioned by multiple survey respondents. Appraisers cited both external obsolescence and functional obsolescence as being frequently overlooked.

“External obsolescence for the subject property – When I’m reviewing appraisals, I see this more often than other oversights. When I was performing retrospective reviews for FNMA, their biggest complaint was that appraisers did not point out external obsolescence for the subject and/or its impact on marketability (if there was an impact).”

“Functional obsolescence – Appraiser focus has changed over the years as subject functionality has changed.”

To read lots more, click here

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Value, Accuracy, and Misleading for Appraisers

By on May 15, 2020   /   Appraisal fees, commercial appraisal, Coronavirus, desktop appraisals, Fannie, FHA, lender appraisals, Mortgage applications, real estate market, unusual homes, USPAP, webinars   /   Leave a comment
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On Value, Accuracy, and Misleading…and How They are Different From What You Might Think!

By Tim Andersen, MAI

Excerpt: Let’s start this musing by addressing the issues of value, accuracy, and misleading. You might have looked at them differently in the past. Then we’ll tie these in the idea of the value conclusion in an appraisal being right or correct.

State appraisal boards level charges against appraisers. It is very common for appraisers to defend themselves against these charges by insisting their value is “right”. Or, they assert they have properly supported their value conclusion, or something similar. In reality, this argument is utterly irrelevant and carries no weight with the appraisal board.

IRRELEVANT!?

When it comes to value, accuracy, and misleading, the appraiser’s value opinion alone is irrelevant and weightless. This is because TAF has given state appraisal boards specific instructions. Those instructions are that the appraiser’s value conclusion is not to be a part of the board’s investigation. Nor is it to be a part of its deliberations. Therefore, it is not to be part of the appraiser’s defense since it is not part of the charges against the appraiser.

To read more, click here

My comment: Tim is a regular contributor to the paid Appraisal Today. He is The USPAP Expert and helps appraisers stay out of trouble with their state boards!! Tim also has an interesting podcast – link is on the top of the page.

What to Do When Your Appraisal Is Under Review(Opens in a new browser tab)

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7 Things to Watch in your Appraisal Market

By on April 18, 2020   /   adjustments, appraisal classes, appraisal regulations, Coronavirus, desktop appraisals, Fannie, FHA, Freddie, FUN, real estate market, va   /   Leave a comment
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Seven things to watch in real estate during a pandemic

April 14, 2020 By Ryan Lundquist

Excerpts:

1) Listings: We often think about listings increasing as a way to see the market changing, but right now many markets across the country are seeing fewer new listings. So at times change is best seen with less of something rather than more. It’s not a surprise to see fewer new properties during a pandemic, right?…

7) Prices: In real estate we are so obsessed with prices, but that’s really the last place to look to see the market. What I mean is change happens first in the areas above before showing up in sales stats a couple months down the road. In short, for now the slower pandemic trend hasn’t infiltrated sales price figures as of yet in Sacramento. This doesn’t mean the market is stable in every price range and location. All I’m saying is regional and county stats don’t show price declines right now. Normally I pull monthly price data, but I’ve switched to weekly in order to see the trend sooner rather than later.

To see the other 4 factors plus lotsa graphs and many appraiser comments , click here

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Raise appraisal deminimus to $2 million or $5 million?

By on January 17, 2019   /   appraisal business, Appraisal fees, deminimus, desktop appraisals, george dell, humor, lender appraisals, threshold   /   Leave a comment
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Should we raise the deminimus to $2 million? Or $5 million?

By George Dell
Excerpt: To simplify this discussion, let’s note two facts:  Appraisers can perform ‘evaluations’, normally using the same scope of work as an unlicensed “evaluator”.  What’s the difference?  It appears to me that there is one key difference.  The question is then:  Which part of the service is not required?  Is it the integrity/ethics, or the performance (such as using the right data and analysis)?

It appears to me that since unlicensed persons can charge less, have less tax/fee burden (for licensing, education, and errors/omissions insurance- the less ethical, less responsible ‘evaluator’ can always outbid the licensed appraiser every time.

Read the full blog post and appraiser comments. What do you think? Add your comments.

My comments: Interesting analysis by George, of course!! Credit unions are proposing to raise the commercial deminimus to $1,000,000. I didn’t know they made commercial loans. Guess they forgot about the commercial crash in the late 1980s.
As long as Fannie and Freddie (and their investors) require res appraisals, it won’t have a big effect on residential. The FIRREA deminimus in 1989 was $200,000. No effect on much of anything, even though we thought the Sky Was Falling.

The usual Mortgage Cycle: Good Business = lower requirements. Bad Business = higher requirements.

 

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Where Are the Most Mcmansions for Higher Appraisal Fees

By on February 22, 2018   /   appraisal business, appraisal how to, Appraisal Standards Board, bad appraisers, desktop appraisals, evaluations, hybrid appraisals, mortgage loan volume, real estate market, unusual home, unusual homes, weird homes   /   Leave a comment
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Who Ordered All the McMansions? 10 Cities Where They’re Piled Highest

Excerpt: You know them when you see them.

The imposing, ostentatious structures looming over surprisingly wee plots of land. The crazily mismatched architectural styles. The hipped roofs, gabled roofs, and pyramidal roofs-all on the same house! The bank columns. The front yard Romanesque fountains. The puzzling profusion of window sizes and types. The gigantic, two-story front doors.

Click here for more info and where there are lots of them:

https://www.realtor.com/news/trends/metros-with-most-mcmansions

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Covid-19 Residential Appraisers Tips on Staying Safe

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