2012 Loan Originator Survey Survey and Analysis of the Nation’s Mortgage Loan Originators
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Appraisals
Originators have been hit with a double-whammy because of appraisals. First, they are now subject to cumbersome requirements when ordering appraisal reports. Second, they face lost deals as a result of low fair market values. This area seems to be one of the biggest sore spots for originators — who are frustrated with appraisal reports and the appraisal process as well as appraisal management companies and appraisers, themselves. Appraisal Impact on Business Several respondents indicated that their business was off by at least half due to low fair market values — including one who indicated lost business had reached 80 percent. Appraisal Rules and Requirements As required by the Dodd-Frank Wall Street Reform and Consumer Protection Act, HVCC was replaced in May 2009 by appraiser independence requirements. Nearly two thirds of originators said that they maintain compliance with the appraisal rules and requirements by utilizing an AMC. A company-managed appraisal panel is used by 29 percent of the originators, and 3 percent said appraisals are handled by the lender. Comments About Appraisal Process Comments were overwhelmingly negative. Some originators complained about the appraisers, themselves, while other have issues with AMCs. The lack of appraiser accountability irritated several originators, while other complained about slow turnaround, higher costs and out-of-area appraisers doing a poor job. Here are some of the more notable comments:
But there were a few positive comments, including this one: “It is ok,” one survey participant said. “Because of all the fraud and corruption in [the] past we had to come to this system.” |
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