More Lies From the Appraisal Institute
“Yesterday, Thursday, appraisers may have had 50 or 60 clients that they could deal with, so if they were getting undue pressure from somebody they could just tell that client no, I'm not doing any more work for you,” says Jim Amorin, of the Appraisal Institute (MAI.) “Today the number of players in the field have been drastically reduced to generally these appraisal management companies, so the pressure that's going to be brought to bear on appraisers we fear is going to be as strong if not stronger than it was before, the whole thing the code of conduct was trying to address.”
Frankly, Mr. Amorin and the Appraisal Institute (AI) are full of it! They are and have been in bed with the major lending institutions for at least 25 years, since their defection from the National Association of Realtors (i.e. the American Institute of Real Estate Appraisers,AIREA) and their (MAI) appraisers are primarily responsible for “DEBOCLE-I.” Ere go licencing! If you don't believe me, call the head's of the Commercial Appraisal Departments of Wells Fargo and Bank of America and ask them how many of their appraisers are not Members of the Appraisal Institute.
They are also an integral part of the Appraisal Foundation, who is responsible for appraiser governance. Many MAI's are employed by the Foundation and State Agencies, including the Office of Real Estate Appraisers, in California and yet, for years, they did nothing to interfere with, or retard infalted home prices, corruption, or the fraud which caused “DEBOCLE-II.” The Appraisal Institute's only concern has been to corner the market with it's low quality, high priced, made as instructed appraisal product(s.)
Mr. Amorin's suggestion that an appraiser would have 50 to 60 clients at any one time is totally ridiculous, I have been in the Real Estate Business for over 30 years and have never met an appraiser who has had more than a handful of clients at one time. His second statement is base, specious, and borders on FRAUD. The number of “players” (as if this were a game) has not changed as a result of the Home Valuation Code of Conduct (HVCC.) Fee appraisers are still free to work for whomever they choose. If good appraisers chose not to work for 'Appraiser' Management Companies then they, the AMC's, will subsequently be forced out of business, due to a low quality (i.e. MAI) product. Isn’t this how business is supposed to work?
The one thing that you will never hear from these opponents to the HVCC is that the affected financial institutions will be required to fund a private organization to monitor complaints from appraisers, about lender and AMC preasure. Something that the Appraisal Foundation and State Regulatiors were unable to do, something this industry has never had, and something this industry desperately needs. I can recall a number of occassions that I felt pressure and had no one to report it to. If they, the new regulatory body, do their job properly, AMC’s who attempt to apply pressure on appraisers will again, I believe, be forced out of business.
For the Record: I am not involved with an 'appraiser' management company and personally think that they should be banded, to protect the consumer from unnecessary increased costs/appraisal fees. But, one thing is absolutely certain, our industry despriately needs to be free of the Appraisal Institute, their Monopely, LIES, and Misrepresentations!
PS: I have been accused, on many occassions, of wearing Rose Colored Glasses, but you can be sure of one thing, for all the Tea in China, I would not trade them for a pair of Money Green Goggles available, for purchase, at the Appraisal Institute (AI/MAI.)
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Curtis D. Harris, BS, CGREA, REB
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Q: How do you know when an MAI is lying?
A: Opens his MOUTH!
Q. How do you know when an MAI has Committed Fraud?
A. He Signs his Signature.
As published in Scotsman Guide's Residential Edition, July 2008.
This is perhaps the most-transformative time for real estate appraisers in two decades, according to Appraisal Institute President-Elect Jim Amorin, who says that some of the changes -- actual or planned -- will also affect mortgage brokers. With rumors of appraisal changes having circulated for months now, Amorin addresses the ideal relationship between appraisers and mortgage brokers.
Recent proposals call for prohibiting brokers from ordering appraisals. What's the institute's stance on that? Many appraisers have spent years developing good business relationships with honest and ethical mortgage brokers. To remove those folks from the process would take away a potentially large source of appraisers' business. If you're talking about professional and ethical mortgage brokers, then there would be no reason to exclude those folks from the ordering process.
How do you suggest making sure that brokers are honest and ethical? We think one way to do that would be to make sure that there are either civil or criminal penalties against people who put undue pressure on appraisers.
I'm not talking about a mortgage broker ordering an appraisal and having questions about the appraisal. That's a typical, everyday part of what happens, and that's not really pressure.
What I'm talking about is making sure that once we submit that appraisal to mortgage brokers, they don't say, "If you don't raise that value, you're not going to get any more work from us."
What suggestions do you have for brokers working with appraisers? The best thing mortgage brokers can do is provide all the necessary information -- including the current property address and contact information for the borrower -- and be clear about what type of appraisal they're looking for: a full appraisal or a drive-by appraisal. After that, they should stand back and let appraisers do their jobs without any undue influence.
If brokers are barred from the appraisal-ordering process, what other effects will there be? Lenders will either do the appraisal-ordering themselves, or they'll hire appraisal-management companies to do it for them. In our experience, appraisal-management companies focus on two things, neither of which is necessarily good for the consumer. They focus on who can do the appraisal fastest and [who can do it] cheapest. Ultimately, the outcome will be lower-quality appraisals.
Noting the Real Estate Settlement Procedures Act reform and other alterations to mortgage policy, what's the Appraisal Institute's primary concern? Making sure our members can develop credible appraisals. If we can develop a meaningful process where mortgage brokers can be involved, then many of our members are going to be very happy. They have great relationships with mortgage brokers who help ensure unbiased, neutral and pressure-free appraisals.
Darrick Meneken is an associate editor at Scotsman Guide. Reach him at (800) 297-6061 or firstname.lastname@example.org.