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Appraiser News – Anti-Cuomo Appraiser Pleads Guilty To Terrorist Threat Charges

March 15th, 2010 by Bill Collins Leave a reply »

TUESDAY, MARCH 16TH, 2010

Long Island Appraiser Jack Geoghan Pleads Guilty to Charges

Newsday reported on March 13th that Jack Geoghan, a Certified Residential Appraiser from Bayport, New York, plead guilty “…to charges of making a terroristic threat, a felony, and aggravated harassment, a misdemeanor”.  The article reported that Mr. Geoghan will enter a mental health program for up to 18 months of rehabilitation. Upon completion of the program he will face three years probation “…with alcohol, narcotic and psychiatric conditions and monitoring,” the Suffolk County district attorney’s office was reported to have said in a statement on March 12th.  It was also reported that Mr. Geoghan will be sentenced to a one year prison term if he does not complete the program.

As Appraiser News previously reported, Mr. Geoghan threatened Mr. Cuomo last December and Newsday reported that Mr. Geoghan told an employee in the New York State Attorney General’s office that “I am going to track him down and shoot him.”

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Moving On In The Wake Of Regulation

We know about the HVCC, the new FHA regulations and Andrew Cuomo’s actions that led to these events which have had a serious negative impact on the livelihood of many appraisers, most of whom resisted the mortgage broker and lender pressure to “hit the numbers” that they demanded.  That was then and this is now.

A column in the March 12th edition of the Long Island Business News by Jeffrey Gitomer, www.gitomer.com, while not directed to appraisers, discusses how to deal with these difficult economic times.  The column is titled “Now that the rules have changed, what will you do?” Here is part of what Mr. Gitomer has to say in this article:

“Many of you have no idea what to do because times are uncertain (that’s an understatement). Times are actually tougher and more challenging than they have ever been in our history.

Think back to other life-changing decisions that you made or were made for you…All of these decisions had an emotional basis, a logical justification and some reward or consequence.

In the middle of all these decisions is life. YOUR life. And every time you take an action, you’re helping yourself see more light.

You’re asking yourself:

Am I doing the right thing?

Am I doing the best thing for others?

Am I doing the best thing for myself?

Do I love what I am doing?

Would I rather be doing something else?

Should I be doing something else?

What else could I be doing?…

…The SECRET: Make change or decide to change based on what you feel is best for you in your heart-and all the rest will fall into place…”

I think that it is time for many appraisers to ask themselves these questions and if the appraisal business is what they really love, make the necessary changes and take actions to broaden the base of their business and create a foundation for many years of a successful appraisal practice!

Jeffrey Gitomer is the author of The Little Red Book of Selling. President of Charlotte-based Buy Gitomer, he gives seminars, runs annual sales meetings, and conducts Internet training programs on selling and customer service at www.trainone.com. He can be reached at 704/333-1112 or e-mail to salesman@gitomer.com

© 2010 All Rights Reserved – Don’t even think about reproducing this document without written

permission from Jeffrey H. Gitomer and Buy Gitomer • 704/333-1112

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Some Answers From The FHA Regarding “Reasonable and Customary Fees?”

As we recently reported in AppraiserNews, the FHA’s Mortgagee Letter 2009-28 took effect on February 15th and it included the following mandates:  “FHA-approved lenders have new responsibilities to ensure that FHA appraisers are “…compensated at a rate that is customary and reasonable for appraisal services in the market area…” and “The fee for the actual completion of an FHA appraisal may not include a fee for management of the appraisal process or any activity other than the performance of the appraisal.” “AMC and other third party fees must not exceed what is customary and reasonable for such services provided in the market area of the property being appraised”.

Working RE Magazine, in its March 3rd issue, questioned Lemar C. Wooley, Office of Public Affairs, HUD HQ Washington, DC.  Here is part of what he told them: “FHA has an internal quality control (QC) process in which targeted endorsed FHA-insured mortgages are reviewed for determining compliance with FHA underwriting and mortgage credit policies and procedures. Among other aspects of the loan, the QC process includes a review of required documentation, including appraisals and fees associated with loan closing. If, in the course of conducting a review, FHA determines that the fee paid to an FHA Roster appraiser for performance of an appraisal is not in keeping with what is reasonable and customary for such a service in the subject property’s market area, the lender may be counseled or otherwise directed to comply with the mandates of Mortgagee Letter 2009-28.”

Wooley cited a frequently asked question from the 2009-28 FAQs which addresses the question of customary and reasonable fees: What does FHA consider customary and reasonable fees for preparing an appraisal report?

Customary and reasonable appraisal fees are reflective of those fees established and negotiated by an FHA approved self employed independent fee appraiser or an appraisal firm that may directly employ FHA approved roster appraisers or retain FHA approved roster appraisers as independent contractors, for appraisal services rendered, regardless of whether a lender, AMC or a 3rd party company or vendor is ordering/ requesting appraisal services. The fee charged must be commensurate with the level of services provided and should reflect the amount of research, level of difficulty, and due diligence required on the appraiser’s part to produce a credible, reliable and accurate appraisal report that is in compliance with all FHA guidelines and USPAP.    

Customary and reasonable Appraisal fees, for purposes of FHA, do not include:

* AMC or other third party fees.

* Management or review fees charged by lenders.

When asked by WRE whether “customary and reasonable” means “whatever fee an appraiser will accept,” Wooley provides the following. “FHA believes that the marketplace best determines what is ‘reasonable and customary’ in terms of fees. Unlike the VA, FHA does NOT set or enforce fee schedules for its Appraiser Roster. To a large degree, the fee is the result of a business decision, which may or may not be negotiated, between the appraiser and the client, whether the client is an individual lender, an AMC or some other party in need of appraisal services.”

Readers interested in reading more of this interview or learning more about Working RE can do so by clicking on the following link: Working RE Online

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Rethinking Housing Finance

Noted economist Robert Shiller in an article in the New York Times on March 5th suggested that cultural mores rather than financial wisdom has guided public policy in the United States for many decades.  He states:

“But what is the long-term justification for putting taxpayers on the line to subsidize homeownership? Is this nothing more than a sacred cow in American society — a political necessity because so many voters own homes and are mindful of their resale value?

We need to consider a gradual transition toward new kinds of housing finance institutions — entities that may lead us to a different kind of housing, yet preserve our core values. Although such innovation isn’t likely to end subsidies, it should refocus them on enhancing the qualities of life that we really value.

We need to invent financial institutions that take into account the kinds of communities we want to build. And we need to base this innovation on an approach to economics that captures the richness of human experience — and not on efficient-market economics, which disregards human psychology and assumes that our basic institutions are already perfect.”

Links to Mr. Shiller’s article along with some dissenting opinions are found here:

Letters: Homeownership’s Future

Mom, Apple Pie and Mortgages

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More Talk About Problems With Commercial Real Estate

The looming crisis with commercial real estate and the mortgage loans secured by it are discussed in this video from CNBC.com from March 2nd.

Commercial Real Estate: A Ticking Time Bomb?

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Big Banks vs. Small Banks

There is a lot of talk in the media about the challenges facing many small banks, particularly with the growing problems facing commercial real estate. They also do not possess the advantages that many analysts feel big banks have with the implied guarantees that they might be “too big to fail” in the eyes of federal regulators. Here are two links that discuss this matter, the first a March 6th article in the New York Times titled “A Banking Battleground” and the second a March 4th video from CNBC.com which includes an interview with Rusty Cloutier, author of “Big Bad Banks” and CEO of MidSouth Bancorp. who discusses what he calls the “two tiered system” in which the losers are those banks deemed “too small to save”.

A Banking Battleground

Surviving the Bank Failure Tidal Wave

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Rates & Dates

The Mortgage Bankers Association (MBA) in its most recent Weekly Mortgage Applications Survey for the week ending March 5th reported that the average rate for 30-year fixed-rate mortgages was at 5.01%, up from 4.95% for the week ending February 26th.  Freddie Mac reported a slight decline in their most recent survey for the week ending March 11th with 30-year fixed-rate mortgage rates dropping to 4.95% from the previous week rate of 4.97%.

Additional information from the Mortgage Bankers Association can be found by going to their site at: Mortgage Bankers Association – Research and Forecasts

Additional information from Freddie Mac can be found by going to: Primary Mortgage Market Survey PMMS – Freddie Mac

Appraisers who are interested in viewing Freddie Mac’s monthly changes in 30-year fixed rate mortgages since 1971 can do so by clicking on the following link: Primary Mortgage Market Survey Archives – 30 Year Fixed Rate Mortgages Since 1971 – Freddie Mac

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“It’s a Great Time to Buy a Home.” And Maybe Some Underwater Land as Well?

On March 12th, the New York Times discussed the historically optimistic viewpoint of the National Association of Realtors as to future home prices. Read the full article here: Great Time to Buy (Famous Last Words)

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Ask Angie

First, we want to congratulate the winner of the last contest:  Thomas “T.D.” Tabor, a Certified General Appraiser with 27 years experience.  T.D. is a Managing Partner with KairosOhio, LLC and services the northeastern portion of Ohio.  It appears that being an MBA and having an ASA designation may have assisted him in providing the first correct answers to Angie’s last contest: “Failure
is the foundation of success…Success the lurking place of failure.” (Lao-Tzu) and
“Man needs difficulties; They are necessary for health.” (Carl Jung)

Today’s two part question: Who said:

“You never know what is enough

unless you know what is more than enough.”

The choices are:

1. William Blake

2. Donald Trump

3. Warren Buffett

4. Bill Gates

5. Robert Louis Stevenson

And:
“If the facts don’t fit the theory,
change the facts.”

The choices are:

1. Michael A. Quinn, Senior VP, Single-Family Risk Officer, Fannie Mae, signatory to Fannie Mae Announcement 08-30 introducing Form 1004MC

2. Alan Greenspan

3. Albert Einstein

4. Lloyd Blankfein, CEO of Goldman Sachs

5. Bernard Madoff

The winner of this week’s contest receives a free copy of the Directory of Appraisal Management Companies for FHA Appraisers.

Angie’s Hall of Fame: Those who have been crowned winners more than once during the past two years and who have been retired from competition for the rest of 2010:

Suzanne Fahien

Pat Reass

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Tell us what you think!

We invite your responses to any of the issues raised in this newsletter. Please e-mail us at: bill@appraiserhelp.com with your thoughts!

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We really hope you find our newsletter to be informative!  If you have any input on future topics for discussion, please email me your questions and I will do my best to address them in the next issue.  If you want to look back at past issues you can see our archive at www.appraisernews.com

Regards,

Bill Collins, Appraiser Help Inc.

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