Property Valuation Columns

State Certified Real Estate Appraisers are technically qualified to appraise any type property for any purpose, so long as their level of certification fits the subject property. General Certified Appraisers are qualified to appraise any property regardless of type, while Residential Certified Appraisers are restricted to appraising one to four unit residential properties. Other than the issue of the type of property, there is no restriction on the purpose of the appraisal, excepting that the purpose must be stated within the appraisal. This being said, the title claim appraisal in many cases requires a different breed of appraiser having skills that go far beyond that of the average certified appraiser.

Simply put, not all appraisers are qualified to appraise properties ... Read More

For most of us, the term Appraisal Management Company (AMC) only became part of lexicon via the Dodd Frank Act. While bankers and appraisers alike may differ with Dodd Frank, it is what we have for now and it is the law of the land. Among the many regulatory mandates required of the legislation, a portion of it dealt with how banks and AMCs must handle appraisals for federal transactions. To say the least, recent Dodd Frank legislation has caused more regulation and with it more compliance expense for banks than has been experienced any time in history. While larger banks such as Bank of America and Wells Fargo are well equipped to handle such mandates, small to mid-size institutions frequently struggle financially to meet these new regulatory demands. Read More

Real Estate Appraisers are human and they do make mistakes. Not all Appraisers were created equal. Some Appraisers have more formal appraisal education than others, some have more appraisal experience than others, some are more dedicated to their craft than others and some properties are more difficult to appraise than others. For these reasons, formal Appraisal Reviews are necessary on all Appraisals in my opinion. Further we must ask ourselves the same questions about the Appraisal Review that we ask about the Appraisal Report, is it credible and can it be trusted? Below you will find the criterion that I use to evaluate the Appraisal Review. Read More

In this day of increased real estate appraisal regulation; banks, appraisers, and appraisal management companies are being subjected to more, “under the microscope” scrutiny. The costs of appraisals have risen significantly as a result of the Dodd Frank Act and one would think that consumers would be protected from inferior appraisals. Unfortunately, this is not the case.

One would expect that, at a minimum, all appraisal regulatory agencies would require the appraiser to perform inspections of the surrounding neighborhood and the subject property. The primary regulations affecting real estate appraisals for bank loans in the United States are the Uniform Standards for Professional Appraisal Practice (USPAP) and the Interagency Appraisal and ... Read More

To say that Dodd-Frank did little to reduce the cost of making mortgage loans would be the understatement of the twenty first century. According to the FDIC, since Dodd-Frank became the law of the land, 843 community banks have closed their doors. Some would say that not all of the decline can be attributed to the Dodd-Frank Act. Aside from this new law, it is fair to say that federal banking regulations in general have made the cost of banking much more expensive. Dodd-Frank however is a very important recent addition to the equation.

Why have small banks suffered most? We do not hear of so many ... Read More

Today in the mortgage industry, there does not appear to be any shortage of new regulation, both proposed and enacted. We are seeing it at the state and federal levels in our legislatures, as well as through our government sponsored enterprises (GSEs).

Recently, we have seen Fannie Mae and Freddie Mac impose a whole slew of new regulations that must be followed by those selling them loans. This is called the Home Valuation Code of Conduct (HVCC). Among the many rules created by it is one prohibiting mortgage brokers from ordering appraisals.

At the time of this writing, three states this year have enacted ... Read More