- Appraiser Burn Out? Or is it AMC Burn Out?
- Some Recent Real Estate Reports
- What Our Readers Have to Say About Our Recent Newsletter and AppraiserLoft
- "What Do I Do?" Complaints and Claims Against Real Estate Appraisers
- McKissock 7 Hour 2012-2013 USPAP Online Course Now Available in Approx. 40 States and DC
- Rates & Dates
- Ask Angie
- Tell us what you think!
- Closing Remarks
Busy, busy, busy…accepting orders…making appointments…following all the mandated procedures…answering idiotic requests…over…and over…and over…
While many residential appraisers have adapted to the HVCC, the AMCs, the UAD, etc., many seem to be saying “No Mas” to their chosen profession. It has been well documented that appraisers are not a “young demographic” but something seems to be changing with many choosing early retirement or attempting to change the character of their appraisal practices.
Every week we at AppraiserNews.com and AppraiserHelp.com receive notices from appraisers that they have retired, closed down their practices or are just shutting down for awhile. Appraisers whom I have known for decades are disgruntled, even those who have transitioned satisfactorily into this brave new world where we are “managed” by those half our ages and who have little or no appraisal experience.
Dealing with AMCs still seems to be the biggest gripe of residential appraisers but the problems seem to be compounded by new requirements which add minutes/hours to each assignment, extending the workday later into the evening and on to weekends. Commercial appraisers also do not seem particularly pleased with the appraisal profession either as the overall stress level of market participants is elevated in this depressed environment making them hope (worry?) that their client (local bank?) will be solvent when it is time to pay the appraisal fee.
The happiest appraisers we have found are either located in remote locations (don’t worry, we won’t say where) with little competition or are building healthy appraisal practices in the non-lending universe. Divorce, estate, tax grievances, portfolio analysis, anything in the world of private appraisal practice seems to be correlated with appraiser happiness.
So, what are you waiting for? How many times do we have to tell you to allocate some time each day to building your private appraisal practice?
By the way, here is a link to the results of AppraisalPort’s recent poll which asked the question “We have been losing many appraisers lately – do you plan to renew your appraisal license at the next expiration date?”
Appraisal Port Poll Results
On December 1st Calculated Risk posted the most recent results of LPS (Lender Processing Services, Inc.) Mortgage Monitor Report which showed that while mortgage delinquencies were down from their peak, foreclosure inventories were at an all time high at 4.29% of all active mortgages. LPS reported that 7.93% of mortgages were delinquent in October, down from 8.09% in September. A link to the Calculated Risk report is found here: Calculated Risk: LPS: Mortgages in Foreclosure Process at an All-Time High
The Case-Shiller Index released on November 29th showed declines of 3.8% from the previous month and 3.6% from the same month last year, both declines greater than anticipated. Bloomberg’s Alex Kowalski discussed this that day and a link to his report is found here: Home Prices in 20 U.S. Cities Fall More Than Forecast, Case-Shiller Says – Bloomberg
CoreLogic reported that same day that at the end of the third quarter, approximately 22.1% of all homes (10.7 million) with mortgages were “underwater”, down slightly from the second quarter (22.5% and 10.9 million properties). They also reported that an additional 2.4 million borrowers had less than 5% equity (referred to as near-negative equity) which together accounted for 27.1% of all homeowners with mortgages nationwide. A link to this report is found here: CoreLogic Third Quarter 2011 Negative Equity Data Shows Slight Decline But Remains Elevated
Mokoto Rich writing in the New York Times that day discussed the expansion of HARP (Home Affordable Refinance Program) to more “underwater” homeowners and a link to this report is found here: U.S. Mortgage Relief Program Widens Its Scope
Also on November 29th, CNBC’s Diana Olick noted that homeownership rates were sinking to new lows which could push rates down to their lowest point since the Census Bureau started tracking this in 1962. A link to Ms. Olick’s report is found here: US Real Estate: As Home Prices Sink, Home Ownership Heads to New Lows – US Business News Blogs – CNBC
The NAR (National Association of Realtors) Pending Home Sale Index rose 10.3% in October, more than anticipated. While the chief economist of the NAR, Lawrence Yun, was his usual optimistic self in the NAR’s press release of November 30th, he did note that: “Although contract signings are up, not all contracts lead to closings.” A link to this press release including a video with Mr. Yun (in which he blames “appraisal issues” as a reason for contract cancellations) is found here: Pending Home Sales Jump in October
California appraiser Bob Eklund writes: “I am of the opinion that the head guy at "THE LOFT" boated off with all the money for his "Madoff" style lifestyle and should face criminal charges. The guy lives here in San Diego, started up this company and seems to have run a gigantic Ponzi scheme.
You know how it works: Start a company, lease an impressive office, hire a bunch of clones and you’ve got instant respectability!
Have you heard anything about this gentleman facing charges yet? He definitely should be facing the music and I believe he will in the end. You heard it here first.”
Another (unnamed) California appraiser reports: “I was doing appraisals for AppraiserLoft for almost 2 years. It was a struggle to get paid from the very beginning, in my case (2008). By the end of 2009, I caught on. Their website said appraisers did not have to send invoices or keep track of fees owed because they do all that and send checks out every 15 days. Not true, and any appraiser who does not send or include invoices can be blamed for non-payment. I reported "The Loft", to the Calif. Appraiser board, (OREA), that licenses AMC’s and I was even more appalled at their response. Their typical canned responses include, "We have no advisory opinion." or, "We do not get involved with matters of payment." When an appraiser is MANDATED to go through an AMC…ALL AMC’s should be mandated to pay the appraiser!… Appraisers are treated like the least important part of a real estate transaction, when in fact, we are the most important by collateralizing all the RE loans. It’s this twisted fate of our profession that has led to its down fall. I do not know who would want to go into this profession if not already in it (due to the large sums of money and time spent getting educated, continued education, and all the equipment and info that costs money every month just to be able to perform an appraisal.) We can’t get the work on our own, were at the Mercy of AMC’s, and no one cares if the AMC pays us or not, or how much! This would not be stood for in any other industry!”
New York appraiser John summed it all up by saying that: “You can add my 3,000 to the "loft" number.”
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The above is the title of an article provided to AppraiserNews.com by John Torvi of the Herbert H. Landy Insurance Agency. While this was written in June of 2010, the “target that seems to be on the back of real estate appraisers” has not moved and as we reach year’s end, it is a good time for appraisers to evaluate their business practices and client agreements, particularly those which certain AMCs are asking them to sign off on.
Here is one example from an unnamed AMC: “Vendor agrees to indemnify and hold (unnamed AMC) harmless from any claims, costs, losses, damages, judgments and expenses, including but not limited to reasonable attorney’s fees and expenses, relating to or arising out of any breach of this Agreement and from any and all claims for injury or loss…”
There are times when appraisers just have to say no, they will not accept obligations which require them to sign away rights and take on obligations which could extend years into the future and threaten their financial well being. We at AppraiserNews.com have spoken to a number of appraisers who have had to deal with various threats and claims and have heard the real fear in the voices of those so charged. It makes good sense at this time for appraisers to review all such agreements with their attorney or errors and omissions provider; please feel free to contact AppraiserNews.com or Mr. Torvi at Herbert H. Landy Insurance Agency for additional information (such as the aforementioned article).
McKissock Education, the official provider of the Appraisal Foundation’s online 2012-2013 USPAP courses, is now available in most states. Earlier this year, the Appraisal Foundation and McKissock announced their partnership and the online course is now available to most appraisers who are interested in completing this before the end of 2011. See if courses are available in your area and save up to 20% on course fees by going to our Online McKissock Portal.
Mortgage interest rates were largely unchanged in the most recent weekly reports issued by Freddie Mac and the Mortgage Bankers Association (MBA).
Freddie Mac reported that rates for 30-year fixed-rate mortgages remained at or below 4.00% for five consecutive weeks with this week’s rate at 4.00%, up from 3.98% the prior week.
The MBA in its most recent Weekly Mortgage Applications Survey for the week ending November 25th, reported that 30 year rates with conforming loan balances ($417,500 or less) declined to 4.23% from 4.21% during the previous week. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 4.55 percent from 4.59 percent.
In their press release of November 17th, the MBA also reported a decline of 11.7% in mortgage applications during this most recent week with refinance activity down 15.3% and accounting for 73.9% of all applications.
Additional information from Freddie Mac can be found by going to: Primary Mortgage Market Survey PMMS – Freddie Mac
Additional information from the Mortgage Bankers Association can be found by going to their site at: Research and Forecasts – Mortgage Bankers Association
We would like to congratulate our most recent winner, Charlie Kizer, a Certified Residential Appraiser with Kizer Appraisals in Riverside, California. Charlie was the first to answer that Cicero said “A thankful heart is not only the greatest virtue, but the parent of all the other virtues”, Meister Eckhart noted that “If the only prayer you said in your whole life was, "thank you," that would suffice” and Jon Stewart joked that that “I celebrated Thanksgiving in an old-fashioned way. I invited everyone in my neighborhood to my house, we had an enormous feast, and then I killed them and took their land.”
1. Who Said: "Any intelligent fool can make things bigger and more complex… It takes a touch of genius – and a lot of courage to move in the opposite direction."
a) Michael Williams
b) Edward DeMarco
c) Albert Einstein
d) Isaac Newton
e) None of the above
2. Who said: "Do you want to know who you are? Don’t ask. Act! Action will delineate and define you."
a) William Jones
b) Clark Kent
c) Thomas Jefferson
d) Annie Oakley
e) None of the above
3. Who said: "A Child of five would understand this. Send someone to fetch a child of five."
a) Wolfgang Mozart
b) Jake Harper
c) Groucho Marx
d) Douglas H. Shulman
e) None of the above
The first person to respond with the correct answers wins a choice of one of the following:
One Free Regular Listing on AppraiserHelp.com
A Free Copy of the Directory of Appraisal Management Companies (Available Now to Members of AppraiserHelp.com and FHAAppraisers.com FREE!)
We invite your responses to any of the issues raised in this newsletter. Please e-mail us at: email@example.com with your thoughts!
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
Bill Collins, Appraiser Help Inc.