http://www.realestateappraisertips.info/ - Real Estate Appraiser Tips! Home Appraisers: Is HVCC Actually Increasing Appraisal Fraud?
Wow! This is interesting! Jacob Gaffney, with HoustingWire Update, writes about how HVCC could potentially be causing more appraisal fraud.
Click read the full article, “Flopping Valuations Right Under the Nose of the HVCC“. Here are a few interesting snippets below AND what’s your opinion of this matter? Is your appraisal income down since HVCC and therefore relaxing the overall quality of your work in order to pump out more work to make up for the lost income?
“As with most industry regulation of its sort, the HVCC has caused the pool of “qualified” appraisers to shrink. Ostensibly, with fewer appraisers, the assembly-line mentality begins to rule the day because of the marked increase in workload as appraisal management companies (AMCs) cut appraiser’s fees.
This new market dynamic shouldn’t make fraud more prevalent, however, unless the appraiser is working an angle somewhere.
Ross Miller, president of Miller Home Mortgage in Metairie, La., sits on the board of the Louisiana Mortgage Lenders Association (LMLA). He thinks that appraisers need to do more appraisals in order to hit income targets and this can leave them open, in some cases, to fraud. But what’s worse, in his eyes, is that the HVCC is speading appraisers too thin.
“We are losing one deal after another because the appraisers are less qualified, less experienced, less professional, traveling a further distance to do appraisals and unfamiliar with the area they are working in and are then unwilling to correct their errors,” he said. “The housing market will not recover fully unless these rules are amended or removed.”
And with such heavy workload, then, couldn’t fraud at least be committed unintentionally? The data says the answer is no. In fact, the below graph provided by MARI (courtesy of Lexis Nexis) indicates that the “I made an honest mistake” excuse holds little water, as the types of appraisal fraud are trending towards a more even share:
As it stands, the HVCC is meant to reduce the influence of loan officers on appraisers, but one investor I spoke to today in Charlotte suspects that banks may be influencing appraisers more and more in the booming short sale and REO sectors.“
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