Appraisal ethics

andres2bz · Joined: 19 May 2006 Posts: 33 Location: NE

Appraisal ethics

the broker where I work just got a small fine for the way there appraisal order form is set up… not supposed to have value looking for or loan ltv.. I now know its unethical, to write down what value you are looking for on a appraisal sheet, it pushes appraiser to try and get more value… is this common every where? Supposedly no body in the brokerage is aloud to discus value w appraisers until the appraisal is do… how do you get comps, if you don’t even now what value ball park your in?

m2c · Joined: 03 Aug 2005 Posts: 937

It's against the law in Ohio and I suspect other states. Can provide a copy of the contract on sale transacctions though.

A big anit-consumer. I've had a number of instances where if the appraiser knew the value needed to make the deal work, (s)he should just have told us "no way" and gone out saving the applicant the cost of the appraisal fee.

andres2bz · Joined: 19 May 2006 Posts: 33 Location: NE

its funny, it totaly makes sence, Im just shocked Ive been in the biz for 2 yrs, and i just learned this , something so simple...

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Yes, this is an issue.

It would seem like a minor issue for those of us with morals and ethics, but sales people live on closed deals, not on high morals. Because of that, many people have taken a different approach, and when an appraisal comes in light, they say 'well that can't be right, OBVIOUSLY my un-educated consumer who saw the house next doors FSBO listing sheet knows more than you, the professional. Fix it or you'll never get my business again!"

I'm having to deal with this exact scenario with a customer that I've worked with for 2 years. He refuses to listen to the fact that his home is worth what it is worth, and that just because XYZ broker can push an appraiser around to get a higher value that it is not legal and it is not going to benefit him when he goes to sell his house in 2 years.

ken(TX) · Joined: 23 Sep 2005 Posts: 184 Location: Dallas, TX

It's always fun explaining lower-then-expected appraised values when in a declining real estate market. Not fun.

On the bank side of things, we can't even pick the appraiser. The OCC required banks to institute some type of random selection process for choosing an appriaser. So not only is there no service or interaction between me and the appraiser, I don't even know their name.

jrhartman · Joined: 01 Apr 2007 Posts: 107 Location: Michigan

ken(TX) wrote:
On the bank side of things, we can't even pick the appraiser. The OCC required banks to institute some type of random selection process for choosing an appriaser. So not only is there no service or interaction between me and the appraiser, I don't even know their name.

I am in the exact same boat as you are, almost no contact whatsoever.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Same here, with some very specific exceptions to the rule.