Appraiser between rock, hard place

As an independent appraiser for over 40 years, I have had underwriters and lenders request, almost on a daily basis, that I “hit the mark,” with the implied reminder that if I do not appraise at the value they need to make a loan, I will be dropped from their list of approved appraisers. In fact, it has been so bad that I finally decided to refuse 90% of lender requests and concentrate on forensic appraisals (trusts, divorce, etc.).

Unless and until appraisers are not chosen by the lenders (fox guarding the chicken coop) but rather drawn at random from a list of state-licensed and qualified appraisers, there will always be the potential for abuse. When the appraiser’s livelihood depends on the lender, who wants him to meet the value needed to make a particular loan, many will risk their license to assist the lender, who in turn keeps them working.

For many years, Veterans Affairs has randomly appointed appraisers from a pool of licensed and qualified appraisers, which VA lenders must use for individual loans. This eliminates most of the intimidation of appraisers and goes a long way in developing a legitimate appraisal report.

Let’s require Fannie Mae and Freddie Mac to develop a “pool” and eliminate these appraisal problems that have helped to bring us to the mortgage crisis we have today.

Thomas O. Berge

San Gabriel

It has been very entertaining, if costly, to watch the real estate and banking businesses come apart at the seams. I thought the recent trend of blaming the people who were approved for such large or adjustable loans whose income ultimately couldn’t support them was the epitome of desperately trite finger-pointing, but new events may be strong challengers. One such challenger is outlined in “Appraiser: Enough’s Enough,” Jan. 27.

Gary T. Crabtree, a Bakersfield appraiser, is referenced as having said that 45% of current listings in the Bakersfield area are made up of repossessed homes. The article went on to say that almost all of those homes are “available at rock-bottom prices. These so-called REOs are the new comps.” Elsewhere, Florida appraiser Pamela Crowley said, “We are going to fight, and we’re going to tell everybody what’s been going on.”

One might fairly ask where the righteous indignation was during the last five years of record appreciation and income for those in the real estate and lending businesses.

I’ve already heard from agents cold-calling, trying to drum up business now that repos are the new price comparables. When I point out that a three-bedroom fixer repo that needs a lot of work really isn’t comparable at all to a four-bedroom turnkey home, they counter that appraisers have become tough and lenders won’t fund if the appraisal doesn’t match the agreed price. Apparently, reality still doesn’t enter into the business aspect of real estate.

There is no emperor watching over the flocks, just a bunch of pretenders.

Nels Norene

Camarillo