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Appraisal review pet peeves: Third-party involvement, tech review
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Reviewing appraisals is a crucial element to the overall valuation process, but many times appraisers become frustrated when their appraisals get held up by a reviewer working to qualify the report. The ultimate goal of an appraisal reviewer is to provide a second opinion on an original valuation report in order to justify or qualify it. There are many things, however, that can disrupt this process that could be avoided. Industry experts Frank Danna, president and chief executive officer of Appraisal Logistics, Inc., and Bill King, director, Valuation Services at Veros Real Estate Solutions, tackled the most troublesome areas with appraisal reviews.
While appraisers often operate independently, the appraisal process is anything but independent. Appraisers have the investor representative of the underwriter, the appraiser and the review appraiser. The first step in tackling the problem is to identify the problem.
“Identifying it from the appraiser and review appraiser point of view is pretty straight forward,” explained Danna. “Problem identification from the underwriter’s perspective is a little more complex. Their problems vary depending on individual appraisal results. They have different loan programs with different parameters. The programs are changing daily depending on regulator rules. Their jobs are pretty tough. And then they have the borrower’s expectations — where does the value meet the borrower’s expectations? When should the underwriter pull the trigger to order an appraisal review? Is it because of the borrower?”
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