11-24-16 Newz// Thanksgiving and USPAP

NO WORKING ON THANKSGIVING!!
USPAP VIOLATION!!
THE APPRAISAL POLICE ARE WATCHING YOU!!!

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Thanksgiving – What are you giving thanks for?

Instead of writing about what is good about appraising, this year I write about looking at your personal life, which is much more important.

When you sit down at the Thanksgiving dinner table with your family and friends (or dining alone or with your pets) what do you say you are grateful for? Take a few minutes now to think about what you will say. I know that I have almost always just said something that was sorta lame because I did not think about it ahead of time.

What am I thankful for this year? Good health. I always say that the richest person in the world would give everything they owned for good health. My health is better today than it was 20 years ago, in my 50s. I lost 40 pounds, workout every day, and walk with a friend. One of my brothers died in June at the age of 65 (liver failure due to hepatitis C). There will be an empty plate at the Thanksgiving dinner table. I am grateful every day that I am alive.

If you are a Baby Boomer, please get tested for Hepatitis C. There is a cure now.

Fannie’s Property Inspection Waiver (no appraisal) effective 12/10/16 for all lenders

Notice dated 10/24/16. I suspected that this was where Fannie was going with UAD and CU.

Refis only.. for now. $75 to waive the appraisal requirement.

Fannie has been testing it for quite awhile with some lenders. You may see this referred to as “Day 1 Certainty”, the name Fannie has chosen. They are also waiving reps and warranties (buy backs) so it will be very popular.

Thanks to Dave Towne for this very interesting news!

My comment: I will have an article n this topic for my November newsletter, out November 1, including what this means for you plus lots more details. I have read all the documents, going back to a newspaper article in as 2002. Very interesting.

9-8-16 Newz// Increasing fees, Flawed FEMA maps, Loan apps way up

How many appraisers are increasing their fees?

Poll: In the past year, have your standard fees for a typical non-complex assignment? www.appraisalport.com

 

 

 

 

My comment: Good news that the majority of responses were for increased fees. But, less than $50 annual increase is low. If you work for AMCs, your fees will drop when business slows down, assuming you are not getting very low fees now. If you don’t ask for higher fees now, or drop AMCs that insist on low fees, you are losing lots of money. I keep increasing my fees by $50 every 3-4 months and am still below other local appraisers’ fees. Remember, there is little or no AMC “loyalty” to appraisers. They will not remember you when business slows down and you really need work.

WHAT DO YOU THINK? POST YOUR COMMENTS AND READ OTHER COMMENTS AT www.appraisaltodayblog.com

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McMansion Hell in Roseville CA

Just for Fun!!

Excerpt: Nothing in this world is a better metaphor for what politicians and marketers like to call “The American Dream” than the Californian tract house. Imagine – you too, could have your own sloppily put together plot of land on a nice street lined with other sloppily put together plots of land.

But you, of course, want your sloppily put together plot of land to be different from the sloppily put together plots of land of your peers. Now, your houses may have been built at the same time with the same plan by the same builder, but damn are you not determined to find a way to stand out from the crowd.

Finally, after the nth hour of HGTV, it dawns on you: the windows.

http://www.mcmansionhell.com/post/149807609446/roseville-ca

My comment: check out other interesting stuff on this web site. I didn’t even know there were any McMansions in Roseville!!

Read more!!

What does it cost to take appraisal comp photos?

To keep up on what is happening in appraisal businesses, mortgage lending, USPAP, etc. , Plus humor and strange homes, sign up for my FREE weekly appraisal email newsletter, sent since June 1994. Go to Home on the left side of the menu at the top of this page or go to www.appraisaltoday.com
Sign up in the Big Yellow Boxes

I regularly write about hot topics in appraising and appraisal business management issues
in my paid Appraisal Today monthly newsletter.
$99 per year or (credit card only) $8.25 per month, $24.75 per quarter, or $89 per year.
For more info, go to https://www.appraisaltoday.com/products

What does it cost to take appraisal comp photos?

In general, how much do you think the requirements of taking comp photos increases the cost of completing an appraisal? www.appraisalport.com poll
My comments: Comp photos are very controversial, especially with the availability of google (including historic photos), mls, Zillow, etc. Interesting results. Don’t know if this includes blurring out personal items, people, dogs, etc. Maybe includes driving time (non-rural of course) and downloading and filing photos. At least we don’t have to spend lots of money on photo processing plus time going to and from the store any more!!

I am not sure why, but lots of appraisers don’t like to take comp photos. USPAP certainly does not require it. I always do, even if I have taken a photo before, because I can’t remember what was near the comp, condition, etc. I always remember it when I used hear about it when speaking at Canadian appraisal conferences. At that time, appraisers were not required to put comp photos in their lender appraisals. They told me “I know that area very well.” Or, “I drove by it XX years ago.”

Previous Appraisalport polls on comp photos
6/2/15 – analysis of 3 comp photo polls – Comp Photos and MLS, Fannie, USPAP, etc.
Plus read the comments.

What is a reasonable turn time from assignment acceptance to report delivery for a non-complex SFR?

My comments: I guess a lot of appraisers are busy now. Too bad the poll did not include longer times. I am at 2-3 weeks now. AMCs that promised their lender clients 1-2 days turn times without giving a significant increase in the appraisal fee are in trouble ;> As we all know, turn time depends mostly on how busy we are and significantly changes over time. Residential lender appraising is a boom and bust business.

4-7-16 Newz .Verifying sales .Big data .Weird bathrooms

8 Bizarre Bathrooms from Around the World

“From pop-up toilets in city streets to a bathroom surrounded entirely by an aquarium, these public and private bathrooms are beyond bizarre-and you need to see them!”

Take a break from appraising and check these out. Definitely Weird!!

http://blog.rismedia.com/2016/keepin-it-weird-8-bizarre-bathrooms

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Recent acquisitions of appraisal and title companies

Another great commentary from Dave Towne. Thanks again, Dave!!

From the article in Housingwire.com:

First American Mortgage Solutions, a subsidiary of First American Financial Corporation, acquired Forsythe Appraisals, supplementing its existing valuation capabilities.

Forsythe Appraisals is one of the largest independent residential appraisal company in the United States and offers real estate valuation solutions with nationwide coverage.

Under the acquisition, Forsythe’s management team, including President and CEO John Forsythe, Senior Director of Customer Development Tim Forsythe and Chief Appraiser Alan Hummel, will continue to lead those operations.

http://www.housingwire.com/articles/36672-first-american-mortgage-snaps-up-valuation-veteran-forsythe-appraisals

Read more!!

3-10-15 Newz – Pulling permits, Fannie FAQs, Refi revival etc.

Appraisal and Property Related Frequently Asked Questions (FAQs)

February 12, 2016

This FAQ document provides responses to common questions related to Fannie Mae’s property eligibility and appraisal policies. Following the FAQs, the Attachment on page 10 provides Guidelines for Using Market Conditions Addendum to the Appraisal Report (Form 1004MC).

https://www.fanniemae.com/content/faq/appraisal-property-report-faqs.pdf

My comments: This document does not have a lot of new material, but it is always good to read this so you can cut and paste some of Fannie’s comments into your reports as an explanation. In this month’s paid Appraisal Today I had two articles on the 1004mc form:

1004MC – the good, the bad, and what Fannie says

Statistical errors in the 1004MC by George Dell, MAI, SRA – He has been fighting with Fannie since the form was first required in April 2009

More articles are coming soon in the paid Appraisal Today on how to handle the issues.

Read more!!

About this blog

This blog has all my free weekly email newsletters since 2012. Plus other topics. Please note that the original email newsletter subject line has been significantly shortened. To see the original email newsletters, click here to go to the newsletter archives. The newsletter has been sent out weekly since June, 1994. To subscribe to the free email newsletters and receive them on the date they are first issued, go to www.appraisaltoday.com and sign up in the big Yellow Box!!

Looking for a topic? Use Search box on the right side. There are hundreds of posts on this blog, starting in 2012. 

Read more!!

Disaster appraisal form reports – be careful!! – from 11/12/12 email newsletter


To keep up on what is happening in appraisal businesses, mortgage lending, USPAP, etc. , Plus humor and strange homes, sign up for my FREE weekly appraisal email newsletter, sent since June 1994. Go to Home on the left side of the menu at the top of this page or go to www.appraisaltoday.com
Sign up in the Big Yellow Boxes

I regularly write about hot topics in appraising and appraisal business management issues
in my paid Appraisal Today monthly newsletter.
$99 per year or (credit card only) $8.25 per month, $24.75 per quarter, or $89 per year.
For more info, go to https://www.appraisaltoday.com/products

 

DO NOT FILL OUT ANY PART OF ANY FORM ASKING FOR YOUR OPINION OF VALUE (INCLUDING DIRECTION IN VALUE) AND/OR REPAIR COSTS. DO NOT INCLUDE ANY OPINION OF MARKETABILITY.

Forms that are being used

1. You are working for a lender who allows you send a letter. That’s what I did in 1999-2000 disaster inspection reports in my area. BEST OPTION.

2. FANNIE FORM 2075 OR FREDDIE FORM 2070. THIS FORM IS THE ONLY APPROPRIATE STANDARD FANNIE MAE FORM. This was used for many years for exterior inspections with no appraisal (comps, value, etc). You can discuss the condition of the home in a comments section.

3. Catastrophic disaster area property inspection report. I have seen these from three software vendors. All were different. Unfortunately, some of them have sections for reporting “cost to cure” and/or opinion of direction in value. You will have to modify them, similar to the discussion below on the 1004D. See what it looks in your forms software.

4. Fannie form 1004D – Appraisal Update and/or Completion Report. available 3/05. This form has been widely used by lenders, starting in 2005. See below. THIS FORM IS FOR AN APPRAISAL, NOT INSPECTION-ONLY. EVERYTHING BELOW THE TOP OF THE FORM (address, client, etc.) IS NOT APPROPRIATE. YOU MUST WRITE UP YOUR OWN SCOPE OF WORK, INTENDED USE, ETC. PUT THE APPROPRIATE INFORMATION IN NARRATIVE FORMAT IN A TEXT ADDENDUM. BE SURE TO PUT DISCLAIMERS ON BOTH PAGES OF THE REPORT IN THE COMMENTS SECTION PLUS THE ADDENDUM See below.

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Fannie form 1004D – Appraisal Update and/or Completion Report. available 3/05. This form has been widely used by lenders, starting in 2005, for appraisals “subject to completion”, typically new homes. These reports are done by the appraisal who did the original appraisal. THIS FORM IS USED BY AMCS AS IT CAN BE TRANSMITTED AND IS A STANDARD FORM.

THIS FORM IS FOR AN APPRAISAL, NOT INSPECTION-ONLY. ALL THE FORM BELOW THE TOP OF PAGE 1 IS INAPPROPRIATE AND MISLEADING.

Below that section, the only item that can be used is the Intended user. YOU MUST HAVE AN ADDENDUM DISCUSSING WHAT THE LENDER/CLIENT WANTS.

– You can put text comments info Conclusions on Page 2. Do not check any boxes. Do not fill in any repair estimates. Write up your description in the comments. Such as None apparent (do NOT discuss effect on collateral or marketability). Or, the home has been completely destroyed, except for the foundation. No roof, walls, etc.

– DO NOT FILL OUT ANYTHING IN THE RECOMMENDED INSPECTION SECTION. Repeat the above disclaimer. You can include a brief, general, description of the home in the comments section. Even if is there is no damage apparent, you did not previously appraise the home. Be sure to explain this. For example subject and nearby homes do not appear to have been affected by Hurricane Sandy.

NEIGHBORHOOD DESCRIPTION IS NOT INCLUDED IN THIS FORM AND IS A SIGNIFICANT FACTOR. The disaster forms and the 2075 form include a neighborhood section. Optionally, you may include a statement on neighborhood/nearby homes, such as “Almost all the homes within 2 blocks of the subject are almost completely destroyed” Or, the subject is 1 mile from any apparent storm damage.

You MUST write up your own addendum/letter, covering:

– Statements that:

THIS IS NOT AN APPRAISAL AND IS PROVIDED TO ASSIST THE LENDER AFTER A DISASTER. THE SCOPE, INTENDED USE, CONTINGENT AND LIMITING CONDITIONS, AND APPRAISER’S CERTIFICATION ARE SUPERSEDED BY THIS ADDENDUM. THE SIGNATURE PROVIDED ONLY INDICATES WHO DID THE EXTERNAL INSPECTION. ALSO PUT THIS STATEMENT BELOW “HAS THE MARKET VALUE DECLINED” SECTION. DO NOT CHECK THE BOX.

– Intended use. Do NOT include “To determine if the property has declined in value since the date of the original appraisal for a mortgage finance transaction.”

– Scope of work. ONLY include “perform and exterior inspection of the subject property from the street”.



BE SURE TO INCLUDE THE DISCLAIMER BELOW

“While the appraiser noted no VISIBLE damage, the appraiser is neither an engineer nor a contractor and is not qualified to comment upon whether or not damage may be present which was not apparent from a visual, exterior inspection.”

Source: Liability Insurance Administrators

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REFUSING TO FILL OUT THIS FORM. Some appraisers are refusing to fill out this form. This has the same problem since 2005. Nothing has been done about this. It is your decision. As you can see, it is not appropriate and only the first section of the form can be filled ouit.

If you choose to fill out this form, it is your choice.

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WHAT’S THE ANSWER? A standard disaster inspection report, used by all lenders.

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My last local disasters were in 1989/1990 – Oakland firestorm and Loma Prieta earthquake. I did re-inspections on properties I had previously appraised for lenders. No values or estimated costs, etc., of course. Most of the appraisal work was for insurance companies to determine the value of the property previous to the disasters.

The most recent large disaster was Hurricane Katrina in 2005. This was pre-HVCC and lenders ordered the property inspections as AMCs were not predominant. Many lenders ordered 1004D forms and many appraisers refused to fill them out.

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Be sure you can find the subject!!

GPS is not exact. A subject can be hard if there is nothing there and all the nearby homes are gone. I know from experience!! I had previously appraised the homes after a disaster and had difficulty finding them!!

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What about fees?

The primary factor is how much time it will take. You can work for any fee you choose, even $1, for any report.

Since you will not be providing any opinion of repair estimates, direction in value, etc. look at how long it will take you driving, research (finding the subject), writeup, and transmitting the report. Also, if you can do lots of them on the same day, in the same neighborhood.

I’m hearing from a minimum of $75 (low Fannie 2075 fee) to $200+ each.

If you are doing interior inspections, be sure someone accompanies you. Be very, very careful. Don’t do them for a low fee. They are probably ok in areas with minimal damage, such as broken windows, etc.

Appraisal Humor

Appraisal business tips

A very, very funny appraiser video!