Uniform Appraisal Dataset (UAD): Free Webinars
Most know by now that, in a “quest to improve loan quality through more robust and uniform data,” Fannie Mae and Freddie Mac are introducing a new “language” called the Uniform Appraisal Dataset (UAD). The GSE’s are providing specific and mandatory guidance on how to fill out the 1004, 2055, 1073 and 1075 forms. The FHA and VA have signed on as well. There will be specific rules and verbiage required for the various fields in the forms. Unless the date is pushed back, as of September 1, 2011, all appraisers must complete the appropriate appraisal forms as required by the UAD. December 1, 2011 is the date by which lenders must collect the new Uniform Loan Delivery Dataset (ULDD) data points required for the first phase of implementation, as well as the UAD standardized appraisal data for new loan applications. There is much information available to help appraisers get up to speed, including two free webinars from Fannie and Freddie that have gotten good reviews (please visit WorkingRE.com, Sidebar: Fannie and Freddie Webinars). Most software vendors are in the process of integrating the changes. McKissock Education also has a course (online and onsite) which you can enjoy at a discount through OREP.org called Introduction to the Uniform Appraisal Dataset. For the discount: WorkingRE.com (sidebars/Introduction to Uniform Appraisal Dataset) or OREP.org (click Benefits, OREP Education Network and look for the course name in your state.
FHA Roster: Check your Name
FHA expert Lore DeAstra suggests that FHA appraisers check their name on the FHA Roster occasionally to avoid being dropped inadvertently. “HUD has been making system updates and the lack of your birthday or other information may temporarily remove your name from the list,” DeAstra says. DeAstra is author of the FHA Checklist, Checklist Instructions and eBook (inside back cover). FHA Resource Center: email@example.com. (800) 225-5342. To receive DeAstra’s free monthly FHA Update via email, opt in to the free Working RE News/Special Edition email list: firstname.lastname@example.org.
Fed Board Gives Direction on Challenging Low Fees
Attorneys at the Federal Reserve Board point to where and how to challenge low fees (under Customary and Reasonable Requirement of Dodd-Frank). According to Federal Reserve Board attorneys, Section 312(c) of Dodd-Frank, lays out which agencies regulate which types of transactions- this is the “where” to properly file complaints. Example: ‘‘(1) the Office of the Comptroller of the Currency, in the case of— ‘‘(A) any national banking association; ‘‘(B) any Federal branch or agency of a foreign bank; and ‘‘(C) any Federal savings association. Section 1100 (A)(8) of Dodd-Frank sheds light on the authority under which provisions of the Act are enforced. Once you determine the appropriate agency (i.e. the Comptroller of the Currency (OCC), Federal Deposit Insurance Agency (FDIC), or Board of Governors of the Federal Reserve System), the agency website should have a place to file complaints. Several appraisers have indicated they received prompt and helpful responses to complaints filed by email or phone in the last week or so. It remains to be seen whether the complaint mechanism laid out in the Law will serve its purpose or be just another bureaucratic black hole. Find the complete story including the Dodd-Frank verbiage and links to the pages where complaints can be filed in the Working RE News Edition story: More “How to” Challenging Low Fees . You can opt in to the free Working RE News Edition as well and not miss anything! (Delivered via email every other week.)
Next C&R Fees Battlefield: State Attorney Generals?
According to Appraiser News Online, published by the Appraisal Institute, in an April 22 letter, the Appraisal Institute joined the American Society of Farm Managers and Rural Appraisers in offering its services to the Presidential Initiative Working Group of the National Association of Attorneys General and the newly created Consumer Financial Protection Bureau. In the letter, the appraisal organizations praised the statement of principles signed by state attorneys general and CFPB as a “critical advancement for consumer protection, as well as sound implementation of the consumer mandates found in the Dodd-Frank Act” and pledged to assist with the accomplishing the goals of the joint statement. The letter also addressed two specific areas the appraisal organizations can be of assistance. They highlighted implementation of Section 1475 in the Dodd-Frank Act, which authorizes separate consumer disclosure of fees paid for administrative services provided by appraisal management companies and actual services provided by appraisers. They also noted correctly implementing the provisions related to appraiser independence and the payment of customary and reasonable fees, which became effective April 1. The appraisal organizations are working to ensure the implementation of the provision as Congress intended in the Dodd-Frank Act.
Challenging Low Fees Blog: Information Exchange
To help appraisers through the customary and reasonable fee appeal process, OREP.org/Working RE has established the Challenging Low Fees Blog as a place to exchange information and help galvanize change. It is where trailblazers can share what they learn about the new processes and efforts at reform. Here is a post from late April (press time): “I will be meeting with Congressman Mike Fitzpatrick in approximately three weeks to ask for his support in stopping Banks and AMCs from stealing our appraisal fees and to make sure the consumer gets what they are paying for. The Congressman is on the Financial Services Committee. It is my belief that this is the final showdown for our profession and I am not giving up on something I worked so hard to build the past 20+ years. Therefore I am personally taking action. Nothing will be Sugar Coated in this meeting. You can help me?” Visit appraisertalkback.com (at WorkingRE.com under the Blogs tab).
To provide an information exchange on working with AMCs, OREP.org/Working RE has established the Appraiser Rater Blog. There are no shortages of “do not work with this company,” such as the following: “@Cindy! Boy, are you right! I had to chase them for months for a check. We have friends that had to chase them for 120 days for $3,000+. They are supposed to be run by an “ethical” appraiser but I think not! I did an appraisal for them, busted by rear to get it in in their turn time and then I got an email back saying they had cancelled it and utilized one of the appraisers in the area that does most of their work. I never got a cancellation email. So, I was out two day’s work and $375. Nice!” Learn what you need to know about working with AMCs at the Appraiser Rater Blog appraisertalkback.com (at WorkingRE.com under the Blogs tab).
Customary and Reasonable Fee Survey 14,000
You can join over 14,000 appraisers by participating in the Working RE/OREP.org Customary and Reasonable Fee Survey. (Survey now closed). Results are available now. To learn what appraisers in your area consider customary and reasonable fees (CRFs) for a variety of reports, including FHA appraisals, click here. This Customary and Reasonable Fee Survey includes 365 Metropolitan Statistical Areas nationwide plus rural areas for each state; eight products/services, including reviews and FHA reports. You will also find turnaround times surveyed, which is unique to this report. It’s good business to know what other appraisers in your area are reporting. This report is free. The survey is ongoing and will be updated regularly, so it’s not too late to participate if you have not. Survey data are important for higher fees for several reasons. One goal of the survey is to support appraisers when negotiating fees with appraisal management companies (AMCs), lenders and others. Fees paid by AMCs are fluid and negotiable. Knowledge is power and greater data is harder to dismiss. A number of AMCs have contacted Working RE requesting nationwide survey results in an effort to set fair fees. The hope is that these survey results, considered with others, will help establish baseline fees for appraisers to which they can hold fast, add a premium for their perceived expertise and experience or discount as business dictates. Appraisers are also using the survey data. The following is from a press release by the Arizona Association of Real Estate Appraisers (AAREA): “It has been determined through a survey conducted by the largest Arizona based appraiser association, the Arizona Association of Real Estate Appraisers (AAREA), that the Arizona customary and reasonable fee for the basic residential appraisal report used for lending purposes ranges from $350 to $375. This fee applies to the basic residential report for a single family home and does not apply to complex properties, FHA reports, VA reports, or other report forms or assignments. This fee is also supported by various national surveys that have been conducted since the passage of the Dodd-Frank financial reform act which includes the survey published in Working RE in January of 2011.” Read more at WorkingRE.com; Sidebar: AAREA press release. The survey also stands as a record of non-AMC fees for use in resolving the issue of Customary and Reasonable Fees under Dodd-Frank. See Fed Board Update: Customary and Reasonable, for more.
Customary and Reasonable Fee Petition
www.petitiononline.com/CnR2011/petition.html (Case sensitive.)
Catch up with Working RE’s Online News Edition
If you aren’t subscribed to WRE Online Edition you missed the following stories. You can read them at WorkingRE.com, Library.
- C&R Fees: Winds of Change? The winds of change may be shifting with respect to customary and reasonable fees for appraisers. Here’s why.
- More “How to” Challenging Low Fees: Learn more on how to challenge low fees
- Challenging Low Fees: Attorneys at the Federal Reserve Board point to where and how to challenge low fees.
- Customary Fees: Good, Bad and Uncertain: With implementation of Dodd-Frank and customary and reasonable fees, there is good, bad and some still uncertain news to report.
- Appraising Outside the Banks: Public Projects: The goal is to help appraisers stay in business, broaden their client base and expand their expertise. And, says author and appraiser Sue Hoell, to help meet the current and anticipated demand for competent appraisers for public projects in rural areas, small towns and urban areas.
- Your Future: Appraisal Foundation Raising the Bar: At the “Appraisal Summit” last September, John Brenan of the Appraisal Foundation discussed plans to raise the bar a bit higher for appraisers.
- Insurance: Insight and Advice from the Inside: In this interview, Senior Insurance Broker David Brauner (OREP.org) provides insight and advice from the inside on rates, claims, disciplinary actions, coverage and more. Learn what you don’t know about insurance.
About Working RE Online
WRE Online reaches between 60,000-80,000 appraisers three times a month and 20,000 home inspectors twice a month. If you’re not reading it, you’re only getting half the story. You can opt in to either edition at WorkingRE.com or email email@example.com with “appraiser” or “inspector” in the subject and not miss anything!
Special Offer Editions: In addition to timely industry information, in the past few months, you could have gotten monthly updates on FHA appraising from resident expert and author Lore DeAstra, learned about a la mode’s UAD update, Bradford’s CompCruncher- bringing the power of regression analysis to the appraiser’s desktop, ACI’s integration with S.M.A.R.T.™ (Statistical Market Analysis in Real Time)- enabling ACI appraisers to interact with local MLS data to better identify and report on activity in the local market, APEX’s Sketch version 5, the latest from the Appraisal Institute and the American Society of Appraisers, and the McKissock online course Essential Elements of Disclosures and Disclaimers offered at cost ($15.64).
Not Smart: Canceling E&O Insurance/Giving Up Priors Acts to Save Money
If you are considering letting your errors and omissions (E&O) insurance policy lapse (not renewing or canceling) to cut expenses or thinking about switching to a company that does not provide “prior acts” coverage for your past appraisals just to save money, you should think again. Appraisers are being sued in record numbers today- even the careful ones. Appraisers are taking fire from all sides: lenders who have had to take back properties are in some cases coming after appraisers for inflating values. Homeowners upside down in their properties are suing, claiming they never would have purchased had they known the true value. Others, trying to refinance or sell, are suing and filing complaints with their state appraisal boards charging appraisers with incompetence for “coming in too low.” In some states anyone can dash off a complaint using an online form in minutes with little thought or evidence. Many complaints and legal suits we see these days are ill-conceived, emotional responses to the dramatic loss in equity many homeowners are suffering. No matter the merit, appraisers have to spend time and resources defending themselves- even if they did nothing wrong. As most claims involving appraisers take several years to surface, letting your Claims Made insurance policy lapse, cancelling midterm or willingly giving up your prior acts coverage to save a few dollars, even a few hundred dollars, could be very costly indeed should a claim arise from the past and you have no coverage. For a typical appraiser, it might boil down to 50 cents per appraisal to protect one year’s worth of work. If you have two years of prior acts, it’s twenty-five cents per appraisal to cover those years and so forth. Call your insurance agent to find out what is really at stake. For more on E&O insurance issues, see Insurance: Insight and Advice from the Inside, an interview with OREP.org Senior Broker David Brauner, who has been point of sale for appraiser E&O insurance for 20 years. Find it online at WorkingRE.com.
FHA Appraising Made Easier, More Efficient
FHA work is booming. Here’s an opportunity to make your FHA reports easier and more efficient. The FHA Appraiser Inspection Checklist, Checklist Instructions and eBook is designed to get you up to speed and more efficient at FHA appraising. The Checklist serves as a field guide for completing your reports. The Instructions explain how to complete the two-page checklist line by line. The eBook saves you time and money by summarizing and organizing the material you need to know. Author/appraiser Lore DeAstra says, “We reviewed more than 450 pages of HUD materials and spoke with several HUD officials to compile the FHA Appraiser Inspection Form, course materials, and eBook. It will save you time and money.” The guide was recently updated with the following: Formatting updates for improved ease of use: more concise information in an easy-to-follow eBook searchable by topic; web links to topics for easy access; symbols and pictures included by topic for at-a-glance comprehension to FHA Checklist; FAQ from appraisers and lenders by topic with detailed index by page; over 10 new ways to access information and contact FHA to check competencies and get help fast! (Updates are provided free for one year after purchase.) For more, see the inside back cover or go to WorkingRE.com and click FHA Checklist, Instructions and eBook . The latest update includes answers to the following topics: What should you take pictures of if you suspect Hydrogen Sulfide Gas?; What’s important regarding Conditional Commitments?; Economic life vs. Effective Age?; Fannie Mae Form 2055? “Differentiating yourself from others improves your business and marketing efforts,” says author Lore DeAstra. “These revised materials will help you obtain additional avenues of income pertaining to your FHA expertise now and into the future.” (See the inside back cover for more.)