How to Handle Appraisal Pressure and Stay Ethical?
Excerpts: There’s no simple and easy way to deal with appraisal pressure. A major source of frustration for appraisers is the realization that clients do not have to follow USPAP. The ethical and performance requirements of USPAP apply only to appraisers, not to clients. In other words, USPAP doesn’t prohibit a mortgage broker from calling and asking you to develop an appraisal based on a predetermined value, but USPAP does prohibit you from accepting that assignment.
When you are faced with appraisal pressure, here are some strategies to manage the situation and still maintain your reputation as an ethical, unbiased appraiser.
1. Educate your appraisal clients
A lot of what appraisers consider pressure from clients is merely a result of the client’s lack of knowledge about appraisal standards and ethics. A lender might ask an appraiser to guarantee values beforehand simply because he or she is unaware that it is unethical for an appraiser to do so.
Avoid this by explaining why you cannot guarantee a value or remove that deferred maintenance photo from your report. You might be surprised at your client’s response if you take the time to educate him or her.
For 8 more reasons, click here
My comments: Appraiser Pressure – What To Do? Can you learn to be an ethical appraiser (or person)? Do you try to be ethical in whatever you are doing? Does it depend on who trained you? Or, do you learn from your parents when growing up? A Very controversial topic!
The Good Appraiser (for anyone who wants their number) Always gives us what we need: – Unethical Appraiser. The Bad Appraiser: A deal killer – Ethical Appraiser.
I was trained at an assessor’s office with no pressure to appraise high or low, fail to disclose defects, etc. I was very lucky. Fee appraisers are under lots of pressure. You learn that people are always looking for a value. for example, when doing an appraisal for a divorce, I always say, “If neither spouse likes my value, it must be okay.” For new clients, I make it very clear that I will not be unethical by giving them what they want upfront. I have lost many clients over the years because I was ethical.
Working with difficult appraisal clients
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NOTE: Please scroll down to read the other topics in this long blog post on Real estate market changes, ADUs, AMC interview, unusual homes, mortgage origination stats, etc.
Excerpts: A student contacted me with the following dilemma concerning an Appraisal Management Company (AMC) request: “I told the Management Company that I cannot mark the Zoning Compliance as ‘Legal’ if the report is marked “as-is,” because this would not be true for the current “as-is” condition of the subject on the effective date of the appraisal. The AMC insists that as long as I disclose in the addendum that the zoning is currently ‘illegal,’ then I can mark on the first page as ‘Legal.’”
Take a break and see some very strange things that can happen!!