Teach Your Clients Well
At a recent industry show in Las Vegas (Valuation 2007), one speaker suggested that appraisers facing pressure may try “educating” their lender-clients about the rules, just in case they don’t know. You may be surprised by what is set in stone. One document appraisers use for this purpose is the Frequently Asked Questions on the Appraisal Regulations and the Interagency Statement on Independent Appraisal and Evaluation Functions (March 22, 2005). The Q&A was issued jointly by the following regulators: Office of the Comptroller of the Currency, Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation Office of Thrift Supervision, National Credit Union Administration (the Big Boys). Highlights include: “The regulated institution may provide a copy of the sales contract for purchase transactions. However, the information provided by the regulated institution should not unduly influence the appraiser or in any way suggest the property’s value.” Find more and the full Q&A in Teaching Your Clients Well .
Blacklisting Follow Up
Last issue we told you about appraisers who were blacklisted- shut out of work without their knowledge and without the opportunity to defend against the charges (MARI: Solving the Blacklisting Mystery). According to Brad Ellis, Chief Appraiser/Valuation Quality Assurance, Indy Mac Bank, the Mortgage Bankers Association (MBA) created a task force to provide recommendations for placing appraisers and others on “exclusionary lists.” The task force included lenders and appraisers- Ellis was among them. The report is not available at press time but according to Ellis, the report recommends the following: that appraisers be notified first (before being placed on an exclusionary list); provided an avenue for appeal and that a separate panel be established for reviewing complaints. It also recommends that at least one person on any such panel be a certified appraiser. Ellis recommends that appraisers be professional in their responses; that they review their work, and if it’s incorrect, admit it and fix the problem. He stresses that no one at any institution takes the decision to remove an appraiser lightly but adds that appraisers do not have any “right” to work for any particular lender. WRE will post the report when it is released.
Cutting Expenses: Why Canceling Errors & Omissions Insurance Can Really Cost You
As business slows, some of you are thinking about cutting expenses by either letting your errors and omissions insurance policy lapse (not renewing) or by canceling mid-term. If you do this, you risk losing coverage for all the appraisals (and inspections) you completed in previous years (when you were busy). As most every E&O insurance policy works the same way, if you let your policy lapse, chances are that you will be unprotected should a claim arise from a past report. Switching companies is no problem as most, including OREP, provide prior acts free to new clients, as long as you make the switch on or before your policy expires. As most claims take several years to surface, letting your insurance lapse or not renewing could be very costly indeed, should you be without coverage when a problem surfaces. Most companies, such as OREP, offer payment plans which can keep your E&O insurance in place for around $50 a month (appraisers). To understand your insurance fully, including a list of “Dos and Don’ts for E&O Insurance,” see Cutting Expenses as Business Slows: Why Canceling Your E&O Can Really Cost You or call or visit OREP (888-347-5273-orep.org).
Instant Messages are Appraisal Reports?
According to the Appraisal Standards Board (ASB), an appraisal by instant message or text message is considered an appraisal report. Instant messages or text messages are written communications and, for assignments involving real property, are subject to the requirements of Standards Rules 2-2. Learn more in the ASB’s USPAP Q&A- October 2007.
Protecting your Intellectual Property Rights
“Copyright Appraiser” Tim Vining, MAI has started a consulting firm to help appraisers protect and control their intellectual property. For more see Fair Market Value Management Protecting Intellectual Property Rights or visit www.fmvmanagement.com.
Working RE – Read More Online (flip the pages!)
WRE is now published online- check in when you can (www.workingre.com). You’ll find many stories that didn’t fit in print (see Premium Content on homepage) as well as an interactive version of the magazine you’re holding in your hands, complete with zoom in/out, links and page-flipping features. It’s fun and easy to read. You can also reduce your carbon footprint and save a tree by letting us know you’d prefer the online delivery. OREP members and paying subscribers continue to have unlimited access to all stories online plus the expanding WRE library. WRE Online, delivered via email, continues to publish every other week. You can opt in (free) online. You will enjoy coverage of current issues plus special savings on goods and services from the industry’s most respected vendors. Thanks for reading.