Although HR3126 appears to be coming to end, I wrote a commentary on HR 3126, the Consumer Financial Protection Act of 2009, passing the House Financial Services Committee. My original post (hyperlink to the left) brought out some strong feelings from an appraiser named Max. The comment brought out another side to HR3126 that did not get much press: HR3126 put many apprasiers out of work.

The comment from Max about one of my opinions:

[Quoting me] "Personally, I believe a good appraiser does not need to be an expert in a specific geographic area to do his/her job."[end of quote]I disagree, Ron. It's because of people like you we are in this mess! In every city there is an area where 2 homes real close to each other -- and even look the same -- can be valued very differently. Unless you've done the work there and have the experience you are not going grasp all that's needed to get to the correct outcome, doesn't matter how much research you google! HVCC is a monopoly. It only helps the banks because its another big scam they make money off! Do your research, buddy.

My Reply:

Everyone is entitled to their own opinion. I say PART of the reason this industry got in this mess was because of appraisers buckling under the pressure of mortgage brokers and realtors who were “just needing to make this deal work.” That translates into appraisers who over-valued properties. This wouldn’t have happened if appraisers would have stood firm. A good part of the reason that happened was because appraisers knew the mortgage brokers and the realtors personally. Realtors can write contracts all day long, and mortgage brokers can write loans all day long, but nothing happens if the appraisal doesn't at least match the purchase price. In some cases the appraisers were more than happy to accommodate to make a deal work. In some documented cases, they even got paid for it. The HVCC put an end to all this by taking “friendships” out of the picture.

Are you telling me you would decline a job if it was 10-15 miles from your house and you were not an "expert" in that subdivision? If you are, you may have very high integrity, but you may also be a little hungry. Are you telling me you cannot call the listing agent and get the details of a house that was sold -- if you are not an "expert" in that subdivision? Can you not do your research by calling other industry professionals involved with your comparables? Most professionals I know do it all the time. If you are concerned about variances in neighborhood values, you call the professionals involved in the transaction who can explain the difference in values. I've never had a professional not willing to tell me about the upgrades in the house, who it was built by, construction quality, and any other pertinent details.

Keep in mind a key opinion of my article: “I hope any replacement to the HVCC keeps the original intent of the code.” The intent was to keep the appraisal process independent of pressure from mortgage brokers and realtors. I'm aware that HVCC is a monopoly, but I still believe the pure purpose of the code of conduct is correct.

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Arizona Home inspectors, mortgage, credit