Monday, December 23, 2013


Yes, I know it looks like I've forgotten you all, and this blog. Nothing could be more distant from the truth. Business has been overwhelming, and the nature of the business (litigation) limits the subject matter appropriate to discuss.

When that settles down a bit, I'll have much to say.

In the meantime, all the best to you for a great Holiday Season.

Sunday, November 3, 2013

Valuation Review - 2013 Voice of the Appraiser Survey

Just in case you missed it, use this LINK to download a pdf copy of the Valuation Review - 2013 Voice of the Appraiser Survey.

There is much to see, but this stands out:

"As an appraiser, how would you rate the typical appraisal fee you are paid?

  • 8.6% - Unlivable
  • 53.8% - Low
  • 12.1% - Above Average
  • 25.5% - Customary and Reasonable
Feel free to comment and let me and others know what you think.

Tuesday, August 27, 2013

Fannie - Freddie UAD Update

In an August 27, 2013 release, Fannie Mae and Freddie Mac notify mortgage sellers, services, originators, and appraisers of impending changes to the Uniform Mortgage Data Program.
Fannie Mae and Freddie Mac (the GSEs) will continue to convert several of the current Uniform Appraisal Dataset (UAD) compliance warning edits to fatal UAD edits in the Uniform Collateral Data Portal® (UCDP®). Phase one was implemented on June 22, 2013. The second phase will be implemented in early 2014, with warning edits for the following data fields converting to fatal UAD edits:

  • Quality of Construction Rating (subject and comparables)
  • Location Rating (subject and comparables)
  • View Rating (subject and comparables)
  • Condition Rating (subject and comparables)
Each of the data fields above has associated UAD edits that will be returned in the UCDP if the data provided is incomplete or the format is invalid as defined in the Fannie Mae and Freddie Mac UAD Technical Specifications. When these warning edits are converted to fatal UAD edits, if one or more of these edits is issued it will result in Hard Stop 401 (UAD Compliance Check Failure) and a “Not Successful” status will be issued in the UCDP. If the lender or appraisal vendor receives a “Not Successful” status in the UCDP, the lender or vendor must resubmit a corrected appraisal with the required data in the correct format to ensure a “Successful” status. If the UCDP issues a “Not Successful” status for an appraisal, the loan will not be eligible for delivery to either GSE.
The full release is available at the link above or after the jump. For those of you involved in mortgage lending appraisal assignments, make sure you do not miss this paragraph:
As communicated in the January UAD update, the GSEs intend to discontinue accepting appraisals in PDF and other alternative appraisal formats, and to accept only the MISMO file format in the UCDP. Our goal is to retire UCDP acceptance of the ACI XML and AIReady formats, and the PDF extraction services in 2014. We will provide at least six months’ notice of the retirement date once it has been determined. We continue to work closely with lenders and vendors using these formats to ensure a smooth migration path.

My condolences to everyone required to deal with this mess. Full release after the jump.

Saturday, August 10, 2013

Standards of Practice for Appraisal Management Companies - Florida Rule

The regulation of Appraisal Management Companies became law in Florida July 1, 2011. There were efforts to delay implementation of the law, and additional amendments enacted in 2012 clarified a few points and definitions related to Appraisal Management Companies. The most important 2012 amendments covered Discipline of Appraisal Management Companies. Those became law October 1, 2012.

Shortly after October 1, 2012, the Florida Real Estate Appraisal Board started drafting a rule to implement the new amendments. The effort was spearheaded by FREAB member Mike Rogers. The meetings, attended by individuals representing appraisers and appraisal management companies, were often contentious. Although there was give and take, the appraiser members of FREAB stood fast, and some important provisions were included in the new rule, 61J1-9.002 - Standards of practice for Appraisal Management Companies; Development and Communication of Real Estate Appraisals.

There are over 180 AMCs registered in Florida. The rule is effective June 26, 2013. The full text of the rule is at the link above, and after the jump in this post. Here are a few highlights:

(1) Upon issuance of a registration number by the Department, an appraisal management company shall disclose its issued registration number on each solicitation for engagement and each engagement letter utilized in assigning an appraisal request for real estate appraisal assignments in Florida.
(3) Before or at the time an appraiser accepts an assignment, the appraisal management company shall require the appraiser to declare in writing or via electronic means that the appraiser receiving the assignment is a competent appraiser for the performance of the appraisal being assigned.
(4) An appraisal management company must include instructions to appraisers in letters of engagement to decline the assignment in the event the appraiser is not geographically competent or the assignment falls outside the appraiser’s scope of practice restrictions.
(5) An appraisal management company cannot:
 (a) Require that an appraiser prepare an appraisal if the appraiser, in the appraiser’s own independent professional judgment believes that she or he does not have the necessary expertise for the assignment or for the specific geographic area and has notified the appraisal management company and declined the assignment;
(b) Require that an appraiser prepare an appraisal within a time frame that the appraiser, in the appraiser’s own professional judgment believes does not afford he or she the ability to meet all the relevant legal and professional obligations, and the appraiser has notified the appraisal management company and declined the assignment; or
(c) Require that an appraiser provide the appraisal management company with the appraiser’s digital signature or seal.
(9) Each solicitation for engagement by an appraisal management company for an appraiser’s services must include the following items:
 (a) The name of the AMC; (b) Appraisal management company’s registration number; (c) If the assignment is retrospective the effective date must be provided; (d) The specific intended use; (e) Type of value; (f) A description of the reporting level expected; (g) The identification of the subject to include the property address, county, property type and property rights as requested by the client; (h) Point of contact for discussion of conditions and scope of work; (i) Other assignment conditions; (j) The expected delivery date; and (k) The terms of payment to the appraiser unless otherwise in a contract.

Full text after the jump.

Monday, June 17, 2013

Florida Governor Scott Signs Two Appraisal Related Bills

Within the past ten days, Florida Governor Rick Scott inked his name to two appraisal related bills.

One June 7, 2013, CS/CS/HB 667 was signed into law. The bill amends Chapter 475 Part I and Part II. Of course, the amendments to Chapter 475, Part II affect Florida Real Estate Appraisers. The first change removes Licensed Appraisers from those permitted to supervise Registered Trainee Appraisers. The other significant amendments to the real estate appraiser licensing and certification law recognizes the new Real Property Appraiser Qualification Criteria adopted by the Appraiser Qualifications Board December 11, 2011. Education requirements have been enhanced, and the Florida background check information for new applicants has been modified to comply with the AQB "way". The enrolled version of the bill is at this LINK.

CS/SB 1398 was approved by the Governor June 14, 2013. This bill amends Chapter 475 Part II to authorize the Florida Real Estate Appraisal board to approve qualifying education courses completed by applicants for registration as a trainee or certification as a residential appraiser or general appraiser to be completed through distance learning. This is a major change for Florida. Although the FREAB accepts continuing education completed through distance learning, prior to this amendment, all qualifying education had to be accomplished in a classroom setting. It will take a while for the FREAB to adopt the rules to implement this amendment, and for schools to obtain the required approval for courses, but appraisers seeking qualifying education will soon have an option to the traditional classroom setting. The enrolled version of the bill is at this LINK.

Florida Appraisers - Rule Amendment: Supervision and Training or Trainee Appraisers

For the past several meetings the Florida Real Estate Appraisal Board has been discussing amendments to rules, and language for new rules to implement the sections of Chapter 475, Part II relating to Appraisal Management Companies. The AMC rules are still in the works, but the FREAB has finalized their language for 61J1-4.010 Supervision and Training of Registered Trainee Appraisers. The new language has an effective date of June 3, 2013.

Some of the changes are significant, and Florida Appraisers involved in the supervision of Registered Trainee Appraisers should be aware of some new responsibilities.

  1. Licensed Appraisers are no longer permitted to supervise Registered Trainee Appraisers. Only Certified Residential Appraisers and Certified General Appraisers may supervise.
  2. Supervisory Appraisers must accept "full and complete" responsibility for "any research, data collection, development, analysis, or communication of any appraisal review or the appraisal report by signing and certifying the report is in compliance with USPAP."
  3. The Supervisory Appraiser must personally inspect each appraised property with the trainee "for a minimum of the first twelve months of the registered trainee's initial registration, and thereafter" until the trainee is competent in accordance with the Competency Rule of USPAP.
  4. A Registered Trainee Appraiser "may not sign an appraisal certification within the first twelve months of his or her registration as a trainee appraiser."
  5. A Supervisory Appraiser must included the following statement in any report in which the registered trainee appraiser contributed to the development of the appraisal or the writing of the appraisal report:
I, the supervisory appraiser of a registered appraiser trainee who contributed to the development or communication of this appraisal, hereby accepts full and complete responsibility for any work performed by the registered appraise trainee named in this report as if it were my own work.

Many Supervisory Appraisers must make some drastic changes to their practice to assure compliance with the requirements of the rule. At the very least, each and every appraisal completed with the assistance of a Registered Trainee Appraiser must have the paragraph above to acknowledge responsibility for the work of the trainee.

By all means, take the time necessary to read, understand, and implement the rule.

Full version at this LINK.

Thursday, March 21, 2013

Florida - Appraisal Legislation Update

About a month ago, Appraiser Active posted about two appraisal related bills filed just prior to the annual legislative session.  One was filed in the House, and one in the Senate. In the House, it's HB 667 - Real Estate Brokers and Appraisers. On the Senate side, it's SB 852 - Real Estate Brokers and Appraisers.  

Both included a section to amend Chapter 120, F.S. to require Summary Hearings by the Division of Administrative Hearings for cases involving real estate appraisers. The more we learned about this section, the worse it looked. The amendment would require any Administrative Complaint against an appraiser referred to the Division of Administrative Hearings (DOAH) to be handled under the Summary Hearing Procedure. Additionally, it required Final Orders to be rendered in within 90 days. A little notice provision of the procedure states that the Recommended Order made by the Administrative Law Judge becomes the Final Order without action by the Florida Real Estate Appraisal Board.

No other professional licensing and regulatory board in Florida regularly operates under that procedure. There were plenty of concerns with this section of the bill. With assistance from the Florida REALTORS®, the concerns were communicated to the Department of Business and Professional Regulation, the Florida Real Estate Appraisal Board, the bill sponsors, and the relevant House and Senate Committees. 

Yesterday, the Senate Regulated Industries Committee passed an amended version of the bill with the Chapter 120, F.S. language requiring Summary Hearings deleted. Thanks to everyone involved for their assistance!

Thursday, March 14, 2013

Thinking of Jon

In honor of my nephew, Jon, this a repeat of a post from March 15, 2010. We think of you every day.

It's a sad day in the Appraiser Active family. My nephew, Jonathan Porto, a Marine, was killed yesterday in a non-combat accident in Afghanistan, near Marjah. My sister, Rachel, his mother, Jon's wife, Rachel Jewell Porto, and their two month old daughter, Ariana, could use your prayers. Jon was 26.

The Hillsborough County Sheriff's Office provided an escort for the motorcade from MacDill Air Force Base to St. Petersburg. The Tampa Bay Community showed their respect for Cpl Jonathan Porto.

Barbara Guzzon had produced the first segment of a tribute video.

Cpl. Jonathan D. Porto - "Bringing Him Home" from DiamondFilms on Vimeo.

Saturday, February 16, 2013

Two New Appraisal Related Bills Filed in Florida

The Florida Legislative Session does not start until March 5, 2013, but State Representatives and Senators have been filing bills in advance. Two have been filed with implications for Florida Appraisers, and those expecting to file applications to become registered or certified appraisers in the Sunshine State.

One was filed in the House, and one in the Senate. In the House, it's HB 667 - Real Estate Brokers and Appraisers. On the Senate side, it's SB 852 - Real Estate Brokers and Appraisers.  The bills are identical and intended to amend Chapter 475, Part II to mesh with new requirements imposed by the Appraiser Qualifications Board of the Appraisal Foundation. One of the amendments requires a Supervisory Appraiser to be either a Certified Residential Real Estate Appraiser or a Certified General Real Estate Appraiser. If passed and signed into law, Licensed Appraisers will no longer be able to supervise Registered Trainee Appraisers.

An interesting provision in the bill amends Chapter 120, F.S. to require Summary Hearings by the Division of Administrative Hearings for cases involving real estate appraisers. I have a lot to learn about this process and am anxious to learn how this amendment was proposed. Watch this space for updates as details emerge.

Friday, February 15, 2013

AMC - Proposed FREAB Rules

The Florida Real Estate Appraisal Board met February 4th and 5th, 2013. Their agenda included a number of items of interest, including the docket of cases to be considered by the board, licensee counts, proposals for new rules and amendments to existing rules.

Two are extremely important to Florida appraisers:

61J1-9.002 - Standards of Professional Practice for Appraisal Management Companies; Development and Communications of Real Estate Appraisals

61J1 - 9.002 is a brand new rule, and is being proposed to implement amendments made to Chapter 475 Part II related to the regulation of Appraisal Management Companies. This rule is a work in progress and IS NOT final. The PRELIMINARY text is reproduced after the jump. Although changes were made to the document below during the meeting, it's important to take a look at what they're working on.

The photograph accompanying this post is of Michael J. Rogers, MAI, SRA. Mike is a past Chairman and current member of the Florida Real Estate Appraisal Board. He is a State-Certified General Appraiser, and the principal of Rogers Valuation and Acquisition, Inc. in Pensacola, Florida. Although Mike is not involved with appraisal management companies, he has taken the lead to develop and fine tune the Standards of Practice for Appraisal Management Companies. It's his goal to ensure appraiser independence is preserved and that appraisal management companies comply with clearly  defined standards of practice.

Although others on the board support these initiatives, Mike could use some support and suggestions to ensure the standards of practice are meaningful, and actually make it through the rules making process. 

See the proposal after the jump.

Wednesday, January 23, 2013

Florida Appraisal Council and RPR

The Florida REALTORS® 2013 Mid-Winter Meetings are going on in Orlando, Florida from January 23 - 27. Governance meetings for all the Florida REALTORS® committees and councils are part of the meetings at the Renaissance Orlando at SeaWorld®. The resort is located at 6677 Sea Harbor Drive, Orlando, FL 32821.

Committee and Council meetings are open to all REALTORS® that register for the conference. There is no charge to register. All registration is handled onsite at the hotel. There is something for everyone during these meetings. Among the most interesting, IMHO, are the Public Policy related meetings one Thursday, Friday, and Saturday. Of course, the Florida Appraisal Council meeting on Friday, January 25th is a must. It will be in the Cobia Room from 1:00 until 2:30.

Part of the agenda for the Florida Appraisal Council is an update on the development of the Appraiser Tools for REALTORS Property Resource (RPR). Access to the database of every single parcel of real estate in the United States is already available to every REALTOR member in the country. RPR is working on a set of online tools, tailored to our profession, and focused on automating some of the more tedious form filling functions.

Here is what RPR CEO Dale Ross had to say in his Q4 2012 update to the RPR Board of Directors:

Appraiser Tools Development
The balance of the fourth quarter has been spent on building out the Appraiser Tools for beta testing in the early 2013. The Appraiser features leverage and extend the comparables analysis technology framework released prior to the Orlando meetings, additional functionality has been added in each area of the interface to support the more complex search and comparison needs of the Appraiser user.
As the team turned its attention to the development of these features, we reviewed our plan with RPR’s Appraiser Task Force and provided the group with a list of key questions. In return, we received some very specific, actionable, and incredibly thoughtful input from the group that became central to how we defined our approach. The core concept of RPR Appraiser Tools is to build upon our strengths as a database and analysis engine, by fulfilling an Appraiser’s need for fully-matched data that reconciles public and private sources (such as MLS) in a format which supports the user’s field and observational work, while reserving the derivation of conclusions to the unique skills, training, and experience of the Appraiser user. 
There's still time for Florida REALTOR Appraisers to make the trip, attend the meeting, and get the update on RPR, along with all the other information. It would be great to see you there.

Tuesday, January 22, 2013

A New Year - Pay Attention to Business

November, December, and the first part of January have been extremely busy. Although I was able to fire off a Christmas post, the New Year's post never made it. There has been plenty of appraisal related news, but it's been important for me to produce some appraisal related work, and generate some appraisal related income over the past few months. The checks finally started arriving in today's mail, and there is much to talk about. 

Back in 2009, when Taylor, Bean & Whitaker bit the dust, their affiliated appraisal management company, Security One Valuation Services, LLC stiffed thousands of appraisers. Later that year, Larry Holzer folded his latest disposable appraisal management company, Global Appraisal Solutions, leaving hundreds of thousands of dollars in unpaid appraisal fees. That did not stop him from creating another AMC to sucker in a new group of appraisers.

In mid 2012 appraisers took it on the chin with the failure of AppraiserlLoft. Who knows how many were left holding the bag in that case. 

In late 2012, appraisers from around country heard that ES Appraisal/Evaluation Solutions filed for bankruptcy. A website set up for creditor appraisers shows a tally of over $1.2 million in unpaid appraisal and BPO fees. Now, the word on the street is National Real Estate Information Services (NREIS) will be closing their doors next month.

Appraiser Active is on a quest to improve the profession, but we appraisers are also involved in running a BUSINESS. Please remember when you become part of a "vendor" panel for an AMC, you are extending them credit. Many AMCs are making a big deal of insisting on background checks of appraisers joining their panel. It might be time to do some background checking on the folks you extend credit to.

Just about a month ago I heard from Kim Drago. She was promoting an new site for appraisers, AppraisalAdvisor. The concept sounds interesting. For those of you involved with AMCs, it might be worth a look.  We are not in a position to endorse these folks, but their LinkedIN page has a bunch of great advice and New Years' Resolutions.