Shot Through the Heart

A snapshot of what we learned while attending the 2008 Fall Conference of the Association of Appraiser Regulatory Officials (AARO) here in Washington, DC

Pressure on Appraisers: Appraisers will be happy to know that generally lenders have greatly reduced pressure on appraisers. However, many lenders are pressuring AMCs who pass the pressure down to the appraiser.

Education: There was discussion in more than one session about university-level programs and the consideration of their curriculums for USPAP qualifications. Several colleges and universities offer some coursework that is or could be considered before taking the USPAP exam.

HVCC: An announcement is expected by month’s end. It will likely be implemented March 1, 2009. Given the short time between an announcement and implementation HVCC is not expected to be particularly substantive.

FHA: The Housing and Economic Recovery Act (HERA) requires FHA-approved appraisers to be state certified or part of a national organization. FHA is expected to only consider certified appraisers for the roster but this could vary state by state for the next 12 months. States with high numbers of certified appraisers (approximately 29) will be required to implement the new rule immediately. The remaining states will have up to 12 months for licensed appraisers to get certification.

  1. Justin Morton

    Excellent recap, Jerry.
    Some of those changes are very good to see.
    And I’m most interested in seeing whether the HVCC will include the ban on mortgage brokers?

  2. Jerome Nagy

    What I heard at the conference is that the broker ban stays but federally regulated financial institutions will get an exception.

  3. Bill Hoffman

    This is more of a question than a comment regarding the new FHA requirements for appraisers. Will the NAR be considered one of the National Orginizations.

  4. Jerome Nagy

    Actually, it appears that HUD will only be considering appraisers that are state certified. They will not be looking at national affiliations or memberships.

  5. Doug Quenzer

    I work for a number of large AMC’s and I haven’t felt any pressure. I would bet it’s the new AMC’s that have popped up as they try to get limited market share.

  6. If you go to HUD.GOV you’ll see that HUD has stated that for Appraisers seeking FHA status post 10/01/2008 – that they must be State Certified. State Licenses that were active FHA and updated prior to 07/20/2008 will remain current.

  7. Jerome Nagy

    Here is the link to HUD Appraisals:

  8. Norma Nicholson

    I am looking for an appraiser that specializes in Chattel appraisals.
    Thank you.

  9. Justin Morton

    Hi Norma:
    NAR appraisers deal primarily with real-property.
    For a personal property appraisal, you might want to start with the American Society of Appraisers as they have both real and personal property appraisers as members.

  10. Rachel McDonald

    How would one go about getting a list of State certified apprasiers?

  11. Dave

    The requirement by FHA to use only certified appraisers is nonsense. There was very little difference in the qualifications for the licensed and certified levels mainly to due with experience hours. There are many licensed appraisers that are well qualified to do FHA appraisals. I took the same test for my license that my friend took for his certified. Now that the new AQB standards are in effect many of the certified appraisers that got their certificaiton prior to 2008 do not meet the current standards for their level of licensure. There were just as many lousy certified level reports pumped out over the past 6-7 years as there were lousy licensed level reports. If you would like FHA to change its ruling please contact your congress people and state senators.

  12. Mark

    Who was the genius that decided fraud could only be committed by state licensed, not certified, appraisers. The direction of one’s moral compass does not change with education or certification. From where did this decision come? from?

  13. Monty Brown

    “What I heard at the conference is that the broker ban stays but federally regulated financial institutions will get an exception.”
    What is the definition of a federally regulated financial institution? Does that mean FHA, HUD, VA only? If not, what are some examples of a federally regulated financial institution?

  14. Jerome Nagy

    “Federally regulated financial institution” is any bank, lender, broker etc. regulated by the federal government. The simplest example I can think of is Bank of America.

  15. Monty Brown

    So banks like Union Bank, ING, Chase, Citi, Flagstar are most likely federally regulated?

  16. Jerome Nagy


  17. Monty Brown

    To clarify, does that mean that a broker who is bringing a loan to a federally regulated bank can still choose the appraiser, or does it mean that the lender would choose, but it could be an employee/affiliation of the bank?

  18. Monty Brown

    What do you mean by “federally regulated financial institutions will get an exception.”
    Does that mean that a broker bringing a loan to a federally regulated bank can still choose the appraiser, or does it mean that the lender would still choose the appraiser, but it can be an employee/affiliation of the bank?

  19. Jerome Nagy

    Brokers will not likely be able to choose an appraiser. Lenders likely will be allowed to choose an appraiser but it’s not clear if the appraiser will be permitted to be affiliated.
    Again, I should stress these are the rumors we’re hearing. When the final agreement comes out it could look quite different.

  20. Don Clark

    I just completed a seminar for the Delaware Association of Appraisers where I facilitated a discussion of the HVCC. In preparing for teaching the seminar I did an analysis of the HVCC as well as several proposed IVPI’s. In my opinion, based on what I have read, studied, and from student feed back, I do not see how the HVCC can be implemented without the IVPI being formed as well. But, if it is implemented, in my opinion, the HVCC is nothing more than a full employment act for AMC’s, and the ruination of appraiser/client relationships built up over many years, where appraisers have earned the respect and confidence of their clients. It is an unnecessary evil that is about to be perpertrated on all of us. If the ASC would do it’s job of oversight of state regulatory boards, and state regulatory boards would do their job, we would need neither an HVCC or an IVPI.

  21. Monty Brown

    Any update or word on this? We’re half way through November.

  22. Jerome Nagy

    Nothing new on HVCC at this point. As soon as we hear something regarding an announcement or have any additional information we will certainly post it. Thanks for your patience.

  23. David Feather

    *HVCC Hint For Appraisers*
    For those of you who haven’t figured it out yet; it doesn’t matter when HVCC will be implemented. Banks and lenders have already met the HVCC guidelines (a month or more ago). Meaning that the work you once received now goes through AMCs and you’re new income is 40-50% of what it was in the past. Don’t believe me? Watch both your orders and your income over the coming months.