Appraisers pride themselves on being the independent real estate professionals that clients can trust to provide accurate and insightful market value information and a sound basis for risk analysis and business decision making. The Uniform Standards of Professional Appraisal Practice (USPAP) states that “the purpose of the USPAP is to promote and maintain a high level of public trust in appraisal practice.” Trust in this context is a confident expectation on the clients’ part that they can rely on the integrity and the ability of appraisers to provide meaningful, accurate valuations on a consistent basis. Unfortunately, the global meltdown has brought many changes to the world of residential appraisals, including a significant shift in the way clients view the appraisal industry. Despite the hard work of many appraisers, the large number of defective appraisals identified in recent years has taken its toll on the level of trust clients have for appraisers. Trust is earned slowly, shattered in seconds, and winning it back is no easy feat.

The first step in this quest must be to identify the components of data, technology and science that can be immediately leveraged. With this foundation in place, industry stakeholders, regulators and governments can begin to shape policy and practice that can apply these tools to improve property identification in their respective spheres of influence. A data standard, such as the Mortgage Industry Standards and Maintenance Organization (MISMO) seeks only to provide a vehicle to express and change data in a common, understandable way; it is not a database or a collection of information. And, data standards provide the language that allows disparate data sources on different database structures to have a means to more easily talk to one another. But, true cross-industry and cross-platform participation is needed to realize this vision. 

In September 2012, MISMO initiated a Development Workgroup and invited industry representatives to talk about current challenges and possible enhancements to improve the MISMO data standard’s support for property location identification, verification and best practices. The current version of the MISMO Reference Model (3.2) contains the generally accepted data points for property identification including postal address, legal description and parcel identifiers. The MISMO Property ID Development Workgroup was formed to consider the issues and challenges faced by the industry today in the realm of property identification as it relates to all aspects of residential mortgage lending and to evaluate new techniques, data and solutions that may be applicable for support through expansion of the MISMO data standard. 

Several mortgage industry participants including lenders, technology vendors, regulators and other standards bodies have participated in an open dialog about the various challenges with property identification and how technology and data could be leveraged in a way to serve the common good. There have been two key contributors to the discussion. The Electronic Commerce Code Management Association (ECCMA) who has stepped forward and drafted three very comprehensive, spatially-aware, non-proprietary formulas such that a globally unique number can be calculated and matched to GPS coordinates and expressed as Keyhole Markup Language (KML). 

The Open Geospatial Consortium (OGC) manages the KML standard, which is an XML notation for expressing geographic annotation and visualization within Internet-based, two-dimensional maps and three-dimensional browsers. KML was developed for use with Google Earth, which was originally named Keyhole Earth Viewer. It was created by Keyhole Inc., which was acquired by Google in 2004. KML became an international standard of the OGC in 2008 and is the data standard used by both Microsoft and Google. 

As a reminder, on June 22, Freddie Mac and Fannie Mae will implement the first phase of the conversion of current Uniform Appraisal Dataset (UAD) compliance warning edits to fatal UAD edits in the Uniform Collateral Data Portal (UCDP), as outlined in the April 2013 UCDP Release Notification and UAD Update. If a fatal UAD edit is issued on an appraisal, a "Not Successful" status will be issued in the UCDP and the loan will not be eligible for delivery to either GSE.

The National Settlement Services Summit isn’t just about title industry support and improvement. It’s also about community improvement. And that’s no more evident than at the Make a Child Smile: Charity Bicycle Building Event sponsored by Winward Consulting | Software LLC. At this year's Summit, volunteers spent an afternoon with the October Research staff assembling bicycles that will be donated to a northeast Ohio organization named Guidestone. 

The Appraisal Practices Board (APB) has issued the following solicitations for Subject Matter Experts (SMEs) to assist in the research and development of voluntary guidance on the following topics: Solicitation for Appraising Newly Constructed Residential Properties and Solicitation for Collection and Verification of Sales Data. The SME panels chosen to address these topics will accomplish their goals by, at a minimum, gathering, citing and researching all existing literature and publications.

U.S. Attorney Joseph Hogsett announced the arrest and charging of five defendants who are alleged to have participated in a scheme to abuse the Indianapolis Land Bank program for their own benefit. The indictment alleges that the two city of Indianapolis employees and three co-conspirators engaged in wire fraud and bribery in order to facilitate a number of fraudulent land purchases.

CoreLogic released new analysis showing approximately 850,000 more residential properties returned to a state of positive equity during the first quarter of 2013, and the total number of mortgaged residential properties with equity currently stands at 39 million. The analysis shows that 9.7 million, or 19.8 percent of all residential properties with a mortgage, were still in negative equity at the end of the first quarter of 2013 with a total value of $580 billion. This figure is down from 10.5 million, or 21.7 percent of all residential properties with a mortgage, at the end of the fourth quarter of 2012.

Platinum Data Solutions hired industry veteran Bill King as the company’s new senior vice president, valuation solutions. King, who was formerly director of valuation services for Veros Real Estate Solutions, has more than 30 years of housing industry experience that includes work as a senior executive, qualified forensic expert, speaker, trainer, author, licensed appraiser and licensed real estate agent.  

Day one of the National Settlement Services Summit contained all sorts of practical information for running a business in 2013, in addition to some of the high-level talking points about industry change involving regulators and lenders. The standout nugget, for me, was this simple idea: “The market has never put anybody out of business.”

That was a quote from Darryl Turner, chief executive officer of The Darryl Turner Corp. Turner gave a lively presentation that combined some marketing/sales advice with some motivational talking points, but that specific quote speaks to all of the day’s panels and the greater themes of the industry right now.

Turner’s point is everyone talks about the economy when business is down, but no one really credits the economy for their success. Sure, the market and the economy move in cycles and customers start sending in fewer deals at certain times, but that simple fact shouldn’t determine your success and failure, he said.

We are living in an age of technology, and that’s not going to change. It’s a plain and simple fact that technologies on virtually any level are able to fulfill tasks with greater speed, accuracy and consistency than manual processes. Technology isn’t just a convenience.

 “The companies that embrace technological advancements are going to be able to do more, with higher quality and compliance and fewer resources than their resistant counterparts,” Huff said. “Whether you’re a lender or an AMC, your competitors are using technology, and if you don’t follow suit, they will easily surpass your level of doing business if you continue to resist technology.”

Interestingly enough, technology is also affording more flexibility. Both Bien-Aime and Jennifer Creech, president and chief executive officer of InHouse Inc., based in Ponte Vedra Beach, Fla., recognized that many lenders are tacking appraisal management on their own.

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Positivity permeated the grand ballroom of Cleveland’s Marriott at Key Center hotel as Bill Cosgrove, vice chairman of the Mortgage Bankers Association (MBA) and the chief executive officer of Union Home Mortgage Corp, kicked off the 2013 National Settlement Services Summit. As the housing market continues to improve, it’s becoming a key component to pulling the country out of the recession. While housing numbers are encouraging, Cosgrove cautioned that we need to ensure we have the proper mortgage industry structure in place as we continue through the “year of implementation.”

“Everyone in this room is in an extraordinary position,” Cosgrove said, commanding the conference stage as the opening keynote speaker. “We touch every part of this rebounding marketplace. Together, we all contribute to one entire economic and social infrastructure. The U.S. housing market remains one of the few bright spots in the U.S. economy today. Home sales continue on an upward trend and purchase applications are showing year-to-year growth. With the positive growth in the market place, it’s now the time for all of us – industry leaders, policy makers, consumer advocates – to come together and find a solution that supports a vibrant housing system.”

Cosgrove advocated the creation of a new primary and secondary mortgage market structure that looks beyond the recent government-sponsored enterprises earnings statement and conservativeness to one that plans for the best interests of both consumers and industry professionals. 

October Research LLC, publisher of The Title Report, The Legal Description, Valuation Review, RESPA News and Dodd Frank Update, today announced the winners in its annual awards program, launched to honor men and women in the mortgage and settlement services industries for exemplary accomplishment in the areas of leadership, innovation and philanthropy.

The April Mortgage Monitor report released by Lender Processing Services (LPS) found that the rate of foreclosure sales (i.e., completion of the foreclosure process) in judicial foreclosure states hit its highest point since 2010. However, the length of time that process is taking -- as well as the disparity in foreclosure timelines between judicial and non-judicial states -- continues to grow. Still, as LPS Applied Analytics Senior Vice President Herb Blecher explained, the steady return to a relative degree of normality in the foreclosure sale rate has helped to bring down foreclosure inventories at the national level.

Veros Real Estate confirmed its proprietary Pathway system is equipped to handle the upcoming Uniform Collateral Data Portal (UCDP) changes announced by the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. The requirements involve both the UCDP, the single joint portal for the electronic submission of appraisal data files to the GSEs, and the Uniform Appraisal Dataset (UAD), which standardizes key appraisal data elements and is intended to enhance appraisal data quality on conventional loans.

The Appraisal Institute announced its support for federal legislation that would improve the mortgage underwriting process by ensuring appraisers are provided relevant property information relating to green and energy-efficient features. The Appraisal Institute expressed its backing of the recently introduced Sensible Accounting to Value Energy (SAVE) Act of 2013, which is sponsored by Sens. Michael Bennet, D-Colo, and Johnny Isakson, R-Ga. 

In diving into the biggest pet peeves in the appraisal review process, Frank Danna, president and chief executive officer of Appraisal Logistics, Inc., and Bill King, director, Valuation Services at Veros Real Estate Solutions, narrowed down the list of complaints to the five biggest sticking points.

The Alliance for Valuation Education, a new non-profit organization dedicated to providing greater availability of consistent, quality valuation education and created through the collaborative effort of 13 valuation organizations, is seeking a candidate to serve as an at-large member on its governing body, the Board of Regents. The position is open to appraisers as well as non-appraisers.

CoreLogic released its April CoreLogic HPI report. Home prices nationwide, including distressed sales, increased 12.1 percent on a year-over-year basis in April 2013 compared to April 2012. This change represents the biggest year-over-year increase since February 2006 and the 14th consecutive monthly increase in home prices nationally. On a month-over-month basis, including distressed sales, home prices increased by 3.2 percent in April 2013 compared to March 2013.

The Appraisal Foundation, a congressionally authorized nonprofit organization that fosters professionalism among appraisers by setting qualifications and standards, announced that its Appraiser Qualifications Board (AQB) has approved several degree programs through its Undergraduate/Graduate Degree in Real Estate Review Program. In 2009, the AQB established a Graduate Degree in Real Estate Review Program. In 2011, the AQB added an Undergraduate Degree in Real Estate Review Program. The program is free to any accredited undergraduate or graduate college or university that makes application.

The Ohio Association of Realtors reports that the number of single-family homes and condominiums put under agreement in April rose for the 24th consecutive month compared to the results from the prior year.

“The Ohio housing market has reached a significant milestone in its on-going recovery effort, as we’ve seen an uptick in home purchases across the state month after month for two straight years,” notes OAR President Thomas Williams. “It’s becoming evident that buyers are eager to take advantage of the ideal conditions that exist — from historic low interest rates to favorable pricing — in order to make the dream of home ownership a reality.”

The Appraisal Foundation has begun its annual search for qualified candidates to serve on the Appraiser Qualifications Board (AQB) and the Appraisal Standards Board (ASB). There are three vacancies on the AQB and two vacancies on the ASB. Completed applications for these vacancies must be received by Aug. 1.
 

Home sales increased last month compared to March, according to DataQuick’s April Property Intelligence Report (PIR), yet domestic issues and uncertainty factors continue to stop sales from reaching their full market potential. DataQuick, a provider of real estate information solutions powered by data, analytics and decisioning, also reported that home price growth continued to increase and the number of foreclosures continued to decrease in April; an ongoing stabilization the market has been experiencing the past two months. 

Two women were sentenced to prison terms for their roles in a mortgage fraud scheme that cost mortgage lenders more than $1.3 million. According to the statements of offense signed at the plea hearings, from September 2005 to April 2008, the two women, with the assistance of others, defrauded banks and other lenders of money through false statements and misrepresentations. They used about 20 residential real estate transactions to fraudulently obtain mortgage loans of more than $7.5 million. Loan documents in support of these mortgages listed false employers and false salaries for the buyers, exaggerated the assets available to the buyers to pay back the loans and make cash contributions and incorrectly listed the buyers’ intent to occupy the houses. The appraisals misrepresented the conditions of the homes, greatly enhancing the appraised prices, and, by doing so, raising the amount of loans which the lenders were willing to extend.

StreetLinks Lender Solutions announced  the August 2013 launch of its AppraiserPlus program. AppraiserPlus enhances the professional partnership between StreetLinks and appraisers by removing the traditional hurdles of micromanagement and post-completion appraiser payment cycles. StreetLinks’ lender partners will continue to benefit from exemplary quality and service levels, with the assurance that they will never be responsible for an AMC’s failure to pay the appraiser.

Technological development in the real estate valuation profession remains too focused on appraisal report forms and is not attentive enough to market analysis, according to appraisers, residential clients, mortgage finance industry leaders, bank regulators and other participants May 24 at the Appraisal Institute Stakeholders Forum in Washington, D.C.  

CoreLogic released its April National Foreclosure Report which provides data on completed U.S. foreclosures and the national foreclosure inventory. According to CoreLogic, there were 52,000 completed foreclosures in the U.S. in April 2013, down from 62,000 in April 2012, a year-over-year decrease of 16 percent. On a month-over-month basis, completed foreclosures remained flat at 52,000*, the same number reported for March 2013. 

After last week’s horrific tornado outbreak, Oklahomans were left facing a painful recovery. Our friends at a la mode reported that its Oklahoma City Operations Center was unharmed during the storm.

DataQuick, a provider of real estate solutions powered by data, analytics and decisioning, announced the rebranding of Rels Title, which was acquired by DataQuick Sept. 6, 2012, to DataQuick Title. “The transition of Rels Title to DataQuick Title signifies the fulfillment of our promise for consistency and stability to associates and customers in local markets as well as the company nationwide,” said John Walsh, president of DataQuick. “DataQuick Title customers will continue to receive the same high-quality, personalized service they have come to expect from our organization.”  

The number of homes sold across Ohio rose 20.5 percent in April, as the market posted gains in activity for the 22nd consecutive month. Sales through the first four months of 2013 reached 35,412, a 15.6 percent increase from the 30,636 sales posted during the same period a year ago. The average sales price (January through April) this year is $128,547, a 5.1 percent increase from the $122,349 mark set during the period a year ago. Total dollar volume this year is more than $4.5 billion, a 21.4 percent increase from the four-month mark of a year ago of $3.7 billion.

Are you getting ready for the Phase 2 Uniform Loan Delivery Dataset (ULDD)? Freddie Mac issued a release saying that it’s critical to start planning now to ensure that you’re fully prepared for the implementation. As a reminder, lenders must begin collecting the Phase 2 ULDD data points for all loans with Application Received Dates on or after March 1, 2014, and delivered to Freddie Mac on or after August 25, 2014. “Working together, we can continue to successfully build on the strong foundation of the ULDD by further improving data quality, accuracy and consistency,” Freddie Mac stated.

In response to new regulations requiring lenders and AMCs to perform post-closing appraisal audits, Collateral Risk Solutions Inc. (CRS) launched its new Appraisal Audit Service (AAS). According to chief executive officer Joel Meredith, AAS was designed to relieve lenders and AMCs from the hassle of managing internal audits on their own and having to outsource for individual reviews. 

ACI, provider of real estate appraisal software, announced that Accurity Valuation, a nationwide residential appraisal firm, adopted seven custom ACI appraisal report packs in addition to a forensic review checklist to organize and streamline the production and distribution of appraisal reports. As a result, Accurity affiliate members and their clients will benefit from a uniform appraisal report package fortified by documentation and tools that better support each value conclusion. ACI is a Verisk Analytics company.  

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau announced the following new residential construction statistics for April 2013. Privately-owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1.02 million. This is 14.3 percent (±1.0 percent) above the revised March rate of 890,000 and is 35.8 percent (±1.3 percent) above the April 2012 estimate of 749,000. Single-family authorizations in April were at a rate of 617,000; this is 3 percent (±0.9 percent) above the revised March figure of 599,000. Authorizations of units in buildings with five units or more were at a rate of 374,000 in April.

The median price paid for a Bay Area home moved above the half-million-dollar mark for the first time in almost five years, pushed up by pent-up demand, an improving economy, investor activity, low mortgage interest rates and constrained supply, as well as a continued decline in distressed sales, a real estate information service reported. 

The median price paid in the nine-county Bay Area rose to $510,000 in April. That was up 17.0 percent from $436,000 in March, and up 30.8 percent from $390,000 in April a year ago.

Lender Processing Services Inc., provider of innovative technology, services, data and analytics to the mortgage and real estate industries, announced the launch of its Workout Interaction Tool (WIT), a Web-based application that provides data from its MSP servicing system to and from Fannie Mae's Servicing Management Default Underwriter(SMDU) platform. 

ISGN Corp. announced the addition of former Xerox executive Nancy Alley as its chief product officer. In this role, Alley will oversee ISGN’s technology business unit, which includes all aspects of the mortgage life cycle from loan origination to servicing and default management, as well as construction lending, settlement services and vendor management.

CoreLogic, a residential property information, analytics and services provider, released an analysis of home price trends in more than 380 U.S. markets based on the CoreLogic Case-Shiller Indexes. The indexes are owned and generated by CoreLogic, supplemented with data from the Federal Housing Finance Agency (FHFA). 

At the beginning of 2011, the first of our nation’s baby boomers reached the age of 65. Since then, thousands a day are also reaching that milestone. They have many reasons to celebrate. Senior citizens are most likely to have a “nest egg,” to own their home, and to have excellent credit. Unfortunately, these are also many of the same qualities which make them so attractive to con artists.

In a statement before the House Committee on Energy and Commerce, Subcommittee on Commerce, Manufacturing and Trade, Joseph Campbell, deputy assistant director, Criminal Investigative Division Federal Bureau of Investigation (FBI) discussed the bureau’s focus on reverse mortgage fraud schemes, which can include appraisers.