Comments on: It’s Official: New Conventional Guidelines for Ordering Appraisals

By: Rhonda Porter

Rhonda Porter — Mon, 09 Feb 2009 21:40:04 +0000

Here we go, Roger! The Washington Association of Mortgage Professionals (aka WAMB) will be having their next meeting on this very subject on February 20, 2009 in Bellevue at the Rainier Club. I’ll be there…if any other LO’s are interested, visit http://www.wamb.org for more info.

By: Roger Ingalls

Roger Ingalls — Mon, 09 Feb 2009 21:35:42 +0000

Rhonda:

They are staring to roll in…here’s Flagstar’s.

Effective for all loans received in underwriting on or after February 16, 2009 all 2-4 unit property transactions will require an appraisal performed by a Flagstar approved appraisal management company (AMC). For a complete list of our approved AMC’s along with contact information, please
refer to Appraisal Management Companies

Correspondent loans must be purchased and funded by 2/27/2009 or comply with the new requirement. This change applies to conventional and government loans.

By: Rhonda Porter

Rhonda Porter — Sat, 07 Feb 2009 02:05:59 +0000

Roger, I believe it goes into effect for loans bought by Fannie/Freddie on May 1, 2009 or later so we should start to see more action with lenders. I’m sure this is being fought on different levels…and I hope so. I think this will really harm the consumer.

Have you seen anything?

By: Roger Ingalls

Roger Ingalls — Sat, 07 Feb 2009 01:51:42 +0000

Any new news about this?

I was in a room of lending folks, and they seemed not only utterly unaware this was happening, but many thought it was going to be delayed, again.

Chase made an announcement it was going to implement, then promptly shut down it’s wholesale operations (leaving correspondenet in place).

Have you heard of any other lenders insisting on using an AMC, or announcing a timetable for the rollout?

By: Rhonda Porter

Rhonda Porter — Fri, 23 Jan 2009 15:21:53 +0000

Joe Clancy, I think these guidelines are thoughtless and come at a bad time. They are focused against mortgage brokers when it was a bank that was originally charged and it will hurt independent appraisers as well as impact consumers.

By: Joe Clancy

Joe Clancy — Fri, 23 Jan 2009 04:47:02 +0000

I have been an independent appraiser for the past 10 years. I have mostly mortgage brokers as clients and cannot believe the answer to the industry problems is to add another middle man. AMC’s must really have one hell of a lobby. What a sweet deal for them. They appear to be no different than HMO’s or Health Insurance Companies. Another middle man that profits for doing nothing while appraisers earn less for doing the same work and carry all the liability and exposure. Here is my question: I do not know any AMC’s and have never worked for one. How am I supposed to get work statring may 1, 2009? I personally believe there will be many appraisers out of work come that time……

By: Rhonda Porter

Rhonda Porter — Sun, 11 Jan 2009 22:03:16 +0000

Roger, I agree with what Jonathan Miller was quoted saying (from the Ken Harney article):

But some prominent appraisers are scathing in their criticism of management firms. “Their quality is terrible — all they want you to do is crank it out at the lowest cost,” said Jonathan Miller, president and chief executive of Miller Samuel, one of the largest appraisal companies in the New York City area. Only “the least experienced people” are willing to do the work, he said, “and the product is unreliable.”

By: Roger Ingalls

Roger Ingalls — Sun, 11 Jan 2009 20:50:24 +0000

Kennth Harney has a good column on this subject.

Glad to see it is finally getting some attention.

http://tinyurl.com/harney-appraisals

He leads with the money issue…borrower is charged $500 for appraisal, but the appraiser only gets paid $200.

Maybe it will get fixed…let’s hope so.

Kary,

All systems of human conduct are imperfect.

All they really had to do was to create a mechanism for appraisers to complain regarding undue pressure. Once the loan originator, and their authority (whether banker or designated broker) had to deal with the hassle, expense, and possible loss of licensing following an investigation, it would quickly stop.

I’ve always understood it was unethical to pressure an appraiser to hit a value. At the same time, it is important to be able to discuss values and issues beforehand, so that a realistic set of expectations can be established, and to discuss the results, so that the borrower can understand the outcome, and best possible future steps.

To use a medical analogy, the proposed system is like forbidding the surgeon from talking with the radiologist.

Yes, it may result in more objective diagnoses, but the overall outcome for the patient will likely be worse.

By: Kary L. Krismer

Kary L. Krismer — Sat, 10 Jan 2009 16:21:21 +0000

Rhonda, you’re right about no field being exempt. And there’s a reason “MAI” is said to mean “Made As Instructed.”

By: Rhonda Porter

Rhonda Porter — Sat, 10 Jan 2009 16:15:32 +0000

Roger's correct about refinancing NOW--especially with Fannie's new price hits that lenders are starting to implement...in addition to the appraisal issue. Condo's are really going to be hit and so are cash-out refinances...it ain't pretty and will also stop those who are after that "4.5".