How Well Do You Know Your Rights
Very informative article. In addition to keeping a copy of any request for changes or alterations in file, I also copy and paste their request directly into my report. This has made some Underwriters very uncomfortable and requests for changes have dropped dramatically.
Lender’s Choice: Violate USPAP or Blacklisted
I appreciate the article and my best to Mr. Dingeman in his “David vs. Goliath” battle. I would say that this is not just “his” battle, but every appraiser who works hard to do the right thing with integrity. Chase is wrong on so many levels it just makes my blood boil. Unfortunately for him, my experience (with Chase) indicates this is protocol and he is going to need a great real estate lawyer. They abuse their use of blacklisting good appraisers without reasonable dialog for defense, and no statute of limitation. Not to mention they are giving him the death penalty for doing what he is required to do. We need leaders in this industry or there will be no appraisers left in 10 years.
Chase has a legitimate need for the appraisal information, BUT they went about it the wrong way. They could have relayed information requests through the original client, OR they could have provided the appraiser with the copy of the assignment whereby the client specifically authorized the appraiser to communicate with them in matters related to the appraisal. Chase has a habit of non USPAP compliance. The extra step in going through the “real” client is necessary because many lenders (including Chase) attempt to hold the appraiser responsible for conforming to THEIR appraisal policies after the fact. IE- “we require so many comps; or we require an income operating expense statement and rent survey on all non owner occupied property” when that was never part of the original contracted service. The appraiser needs to file a complaint against Chase with the new Consumer Finance Protection Bureau.
I’m a General appraiser for 20+ years- remember the days when lenders had a requirement that before a loan officer could submit a loan request they had to physically view and take a photo of the property to submit with the request to show they had actually seen the property? Now the question is, why would any bank buy a group of loans without first having each loan appraised on today’s market by a qualified appraiser in the immediate area of the subject property? This is just poor business practice on the part of large corporate banks and other online lenders who have figured out: “If we make bad decisions then the government will bail us out and we can take our big bonuses and retire.” Politicians and agencies responsible for oversight are not doing their jobs or are taking bribes or just plain dumb. – Steve Wyrick
Here’s what else is going on. In the old days, before the lender would put an appraiser on their “black list” they would send an appraiser a certified letter stating the appraisal in question and giving the appraiser an opportunity to rebuttal. Now here is how it works. A broker tells the lender not to use a certain appraiser. The lender then tells the AMC to take the appraiser off the rotation. So the lender does not have to notify the appraiser nor is there any rebuttal as the appraiser is not being taken off the lender’s list but the AMC’s. The broker has more control than before. It doesn’t have to be for any certain appraisal just because the loan officer doesn’t like the appraiser. The AMC doesn’t have to notify the appraiser because they still leave them in the rotation for other lenders who use them. Pretty tricky. This has happened to me. I have no recourse and it was not because of any particular appraisal. I know which mortgage company told the lenders not to use me. I’ve called the lenders and they tell me to call the AMC and vice versa. This is more control than ever by the loan officers. – Charlotte
Dingeman is doing a great job with this elephant on his shoulders. I suggest that his attorney start a class action to resolve this and name a few other large lending institutions who have ineligible lists as they are almost all illegal. All ineligible lists should conform to requirements for appraisal removal as required by Reg Z. If responsibility was appropriately placed on the institution underwriting, as well as those purchasing loans, to conduct proper practices for identifying weakness in appraisals, these issues would be moot. Lost wages for a class action would be very large. – QA Director at and AMC
I was wondering if you had a firm you could refer to me that handles filing suits against lenders that place appraisers on an exclusionary list or otherwise known as blacklisting. I just found out today that I’m blacklisted. – Joshua Rock
John Dingeman, subject of the Lender’s Choice story, answers: “Josh, you can contact Scott H. Zwillinger (firstname.lastname@example.org) and see if he can help. He is the attorney helping me.”
First they came for the socialists, and I did not speak out because I was not a socialist. Then they came for the trade unionists, and I did not speak out because I was not a trade unionist. Then they came for the Jews, and I did not speak out because I was not a Jew. Then they came for me and there was no one left to speak for me. – Martin Niemr (posted to story)
I am a certified residential appraiser. I want to say I got more out your article on the method to determine land value than any other article I ever read in my 36 years of appraising. You have explained in the best understandable possible way. I commend you on your great talent and on your kindness to share this instruction. You cleared up many many questions I had over the years of these concepts and put everyting into a neat simple to understand methods of understanding for all to benefit from. I honor your writing and your excellent instruction. You are above all other instructors I have ever had the pleasure of listening too. – Lawrence Fenimore
In your article you make reference to a Fannie Mae handbook for appraisers, publication number CT147. I just called the number you provided for Fannie Mae and they said this handbook has not be in circulation for many years now—and nothing has replaced that publication!! Do you have any suggestions where else to find this publication? I would be interested to read it. It is very funny because the woman from Fannie sounded frustrated as though she has repeated this information that this is out of print over and over again. I told her I was inquiring after reading an article in Working RE and she commented that they received over 50 phone calls back when the article first came out—that sounds like “demand” to me. – Shelli Kazak
It’s interesting that after I wrote the article that I find out it is out of print. Fannie Mae indicated to me that if they had enough demand they will reprint it but don’t hold your breath on that. Go to www.efanniemae.com and look up guidelines for lenders and appraisers and you will find some interesting information. For example, the guidelines for September 2009 indicate that lenders can rely on the replacement cost new that is indicated in the cost approach of an appraisal for insurance purposes, even though we put in our report that it cannot be relied upon. They also have a tutorial on the UAD. As of present, I have not been able to find the CT147 publication for sale anywhere else. – Phil Spool