Americanrm

NAR Keeps Whining About Appraisals

We've seen all this before. Appraisers and small lenders taking the heat for a systemic failure.

Well just remember... "What goes around comes around."

As a Realtor and a lender during the run-up to implosion, I can attest to the fact that everyone, and I do mean Everyone, during those days (except perhaps, VA), pressured appraisers to deliver maximum values - with no concern beyond the immediate deal.

"How did lenders, buyers, sellers and Realtors enforce their collective will on the hapless appraiser?" you might ask.

Easy. The power of the purse.

You see, it was generally understood by all parties, that if a particular appraiser consistently (1 or 2 times) failed to deliver the goods (value) as ordered, he or she would simply be crossed off the list. A more accommodating appraiser would be found. And, because there were so many new appraisers coming into the field, finding one who would make the appraisals work, was not a problem.

Today, as in the early 1980's, many appraisers are being brought to task for their failure to resist the pressures of the time. They, along with the so-called greedy mortgage lenders, are being publicly spanked and labeled as primary culprits of the collapse.

Very few folks are willing to put the blame squarely where it belongs... at the feet of the large institutions (including Freddie, Fannie and the BIG banks) who actually designed and pushed all the crazy loan programs, in the first place. It was the mass proliferation of goofy loan programs that spurred market participants - lenders, Realtors, Brokers, appraisers, buyers and sellers - to cross the lines of common sense and lose sight of the possible consequences of their actions.

So now, the marketplace is suffering through the extreme paranoia of those appraisers who remain in the profession.

But take heart. If history is any guide, you can be assured that, after enough financial blood has been let... this too, shall pass.